BSEE Director Delivers Remarks at the International Regulators
Forum 2011 Global Offshore Safety Summit Conference
Stavanger, Norway — Bureau of Safety and Environmental
Enforcement (BSEE) Director Michael R. Bromwich delivered remarks today at the International
Regulators Forum (IRF) 2011 Global Offshore Safety Summit Conference in Stavanger, Norway.
The IRF is a group of nine offshore upstream health and safety regulators from eight countries,
including BSEE. It exists to drive forward improvements in health and safety in the sector through
collaboration in joint programs and through sharing information. During his visit, Director
Bromwich met individually with his counterparts from offshore regulating agencies from
around the world to discuss issues of mutual interest.
Director Bromwich's remarks, as prepared for delivery, are below:
Thank you for the opportunity to speak to you here today. I would also
like to thank our colleagues from Norway for hosting us in their beautiful country and the conference
organizers for preparing a very timely and interesting agenda.
When we met in Vancouver a year ago, I discussed the reforms that the
Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) was implementing in the
aftermath of the Deepwater Horizon blowout and oil spill. Today, I would like to share with you
our progress over the past year.
The Deepwater Horizon accident was a watershed for the regulation of oil
and gas drilling on the US Outer Continental Shelf. The blowout and its aftermath highlighted
the inadequacy of existing regulations and the fact that the offshore regulator was charged
with multiple important and conflicting missions – and historically suffered from
an enormous shortage of resources.
Over the past 15 months, my staff and I have worked hard
to remedy these deficiencies. We have undertaken a comprehensive reorganization and
implemented tough new regulations. I am extremely proud of what we have accomplished
to date. I have been impressed by the dedication and commitment demonstrated by BOEMRE
employees who have had to shoulder their regular responsibilities, as well as the
extraordinary amount of work required to reform the way our agency does business.
As you know, just three days ago, we reached an important
milestone in our remaking of US offshore agenda. BOEMRE was replaced by two new organizations –
the Bureau of Ocean Energy Management (BOEM) and the Bureau of Safety and Environmental Enforcement (BSEE).
Today, I will briefly outline how these two new agencies will function. I will also provide an update on
the new safety regulations we have put in place, as well as our efforts to keep offshore safety on the
agendas of leaders from industry, the academic community, and government, both in our country and
around the world.
I. Reorganization
Let me begin by saying a few words about the new organizational structure that became effective
on October 1, this past weekend. One of the fundamental weaknesses highlighted by the Deepwater Horizon
tragedy was the fact that the agency charged with enforcing federal regulations had three competing
missions – revenue generation, responsible energy development, and safety and environmental
enforcement.
On May 19, 2010, a month before I was asked to serve
in the government, Interior Secretary Ken Salazar signed a Secretarial Order
announcing his intention to separate the former Minerals Management Service (MMS)
into three separate organizations. The central goal was to separate these functions
and enhance the ability of our personnel to accomplish these important but quite
different missions. My job, then, was to lead this reorganization and make real
the creation of three new entities, each with specific and independent missions,
and each with the authority and resources necessary to effectively carry them out.
Last summer, we began a thorough review of all of our programs
and processes. We took a very close look at the organizational structure and culture of the
former MMS. We took prompt action to address conflicts of interest, real and perceived, by
implementing a strict recusal policy and setting up an internal Investigation and Review Unit.
We reinvigorated ethics training and made that training specific to the situations our
employees encounter in their day-to-day jobs. We issued updated and more stringent guidance
on the acceptance of gifts.
We also addressed the lack of resources that had plagued the agency
for decades. The President submitted a substantial supplemental budget request in the summer of 2010,
which was partially funded, and that enabled us to begin hiring additional staff. We launched an
aggressive nationwide recruitment campaign, and I personally visited college campuses across the
country to talk about the rewarding and challenging careers awaiting engineers and scientists
in BOEMRE. We have since hired 122 new employees across various disciplines and specialties,
but we need many more.
The creation of BOEM and BSEE, initially announced more than a year ago,
separates offshore resource management from safety, environmental oversight, and enforcement.
This allows our permitting engineers and inspectors, who are central to overseeing safe offshore
operations, greater independence and clearer focus. Our goal has been to create an aggressive but
fair regulator that can effectively keep pace with the risks of offshore drilling and will work
to promote the development of safety cultures in offshore operations.
In BOEM, we have created a structure that ensures
that sound environmental reviews are conducted and that the potential environmental
effects of proposed operations are given appropriate weight during decision-making
related to the management of offshore resources. This is to ensure that leasing
and plan approval decisions take all relevant considerations into account and
are properly balanced. These processes must be rigorous and efficient so that
decisions can be made without undue delays and based on a thorough understanding
of the potential environmental impacts of operations and the confidence that
appropriate mitigation against those potential environmental effects are in
place before they can proceed.
We have renewed and reaffirmed our commitment to develop
thorough, credible and unfiltered scientific data to serve as the basis for our resource
development decisions. To that end, we have established the position of a Chief Environmental
Officer in BOEM. This person will be empowered, at the national level, to make decisions and
final recommendations when leasing and environmental program heads cannot reach agreement.
This individual will also be a major participant in setting the scientific agenda for
the United States' oceans. I have selected this first-ever Chief Environmental Officer
and we hope to be able to announce it in the very near future.
The offshore regulator in the US has long maintained a robust
scientific studies program. However, in the past, there was little effort to disseminate
and promote the important work that was being performed. Further, there was insufficient
attention paid to the program by senior leadership – because of the emphasis given to
revenue generation among the agency's multiple missions. We are refocusing our efforts
to showcase the world-class research being conducted and directed by our scientists,
and we are taking institutional steps to ensure that their research is given appropriate
weight in the decision-making process.
To ensure adequate environmental reviews, we have launched
a review of our historical policies on the use of Categorical Exclusions, as suggested by
the Council on Environmental Quality. During the duration of that review, we have been
conducting site-specific environmental reviews for Exploration Plans submitted by operators.
And even though we are doing more rigorous and more extensive environmental reviews, so far
we have managed to make decisions on those plans within the 30-day timeframe set by Congress.
In shaping BSEE, we took a broad look at the best practices of
domestic and international regulators to create strong enforcement mechanisms across the bureau.
We have established for the first time an Environmental Enforcement Division. This Division will
provide sustained regulatory oversight that is focused on compliance by operators with environmental
regulations, as well as making sure that operators keep the promises they have made at the time
they obtain their leases, submit their plans, and apply for their permits. Our new Chief of this
Division, recruited from outside the agency, started work last month.
In BSEE, we have already established multi-person
inspection teams that are being equipped with better and more advanced tools than
ever before to do their jobs. Our new inspections process and protocols will allow
teams to inspect multiple operations simultaneously and will enhance the quality
of our inspections, especially of larger facilities.
We have established a National Training and Learning Center in BSEE
whose initial focus will be on keeping our experienced inspectors current on new technologies and
processes, and ensuring that our new inspectors are given the proper foundation for carrying out
their duties rigorously and effectively. We have already run two sets of our newest inspectors
through the initial inspector training curriculum. I have selected the first Director of our
National Training and Learning Center from outside the agency and he too came on board last month.
As I have discussed on several occasions over the past
several months, we will be extending our regulatory reach to include contractors as well
as operators. Although I know that many of you have always done so, we have not regulated
contractors in the past – but we clearly have the legal basis to exercise such regulatory
authority. And there is no compelling reason in law or logic not to do so. In my judgment,
it is simply inappropriate to voluntarily limit our regulatory actions to operators if
in fact we have authority that reaches more broadly to the activities of all entities
involved in developing offshore leases. I am convinced that we can fully preserve the
principle of holding operators fully responsible, and in most cases, solely responsible,
without sacrificing the ability to pursue regulatory actions against contractors for
serious violations. We will be careful and measured in applying our regulatory
authority to contractors.
Throughout this process of reorganization and reform,
we have been open and transparent about our intentions. Our goal has been to do everything
possible not to disturb the day-to-day operations of the bureau. We have worked very hard
to ensure those in industry and all interested parties are aware of the changes being
considered and made, that they have a voice in the discussion, and that the reforms
we have implemented make sense and are appropriate to the goals we wish to achieve.
II. Regulatory Reform
The reorganization of the former MMS was only part of our reform agenda. In the immediate
aftermath of the spill, we found that existing regulations had not kept up with the
advancements in technology used in deepwater drilling. Last time I spoke before this body,
I discussed the new, rigorous prescriptive regulations we issued to bolster offshore drilling
safety as well as our expanded efforts to evaluate and mitigate environmental risks from
offshore drilling operations. As I discussed last time, we also have introduced – for the
first time – performance-based standards similar to those used by regulators in the
North Sea, to make operators responsible for identifying and minimizing the risks associated
with drilling operations.
We did this through the development and
implementation of two new rules that raised standards for the oil and gas
industry's operations on the Outer Continental Shelf (OCS). The Drilling
Safety rule created tough new standards for well design, casing and
cementing – and well control procedures and equipment, including
blowout preventers. The Workplace Safety or SEMS rule requires operators
to systematically identify risks and establish barriers to those risks
through a comprehensive safety and environmental management program.
Because the SEMS rule required substantial work by many operators,
we delayed enforcement of the rule for a year. Starting in November,
we will begin to enforce compliance. Based on my discussions with our
own personnel who have been gearing up to ensure compliance with the
SEMS rules, and my meetings with individual operators, I am confident
that the vast majority of operators will be ready with their SEMS
programs by that date.
Over the past year, we have also put in place a
number of additional safety regulations. Last month, we proposed a follow-up
rule that further advances the purposes of the SEMS rule. It addresses additional
safety concerns not covered by the original rule and applies to all oil and natural
gas activities and facilities on the OCS. We first announced that this rule
would be forthcoming at the time we announced the original SEMS rule, so it came as
no surprise to anyone. The proposed SEMS II rule includes procedures that authorize
any employee on a facility to exercise Stop Work Authority in the face of an activity
or event that poses a threat to an individual, to property or to the environment.
The proposed rule also establishes requirements relating to the clear delineation
of who possesses ultimate authority on each facility for operational safety;
establishes guidelines for reporting unsafe work conditions that give all employees
the right to report a possible safety or environmental violation and to request
a government investigation of the facility; and requires third-party, independent
audits of operators SEMS programs. We believe these are reasonable, appropriate,
and logical extensions of our original SEMS rule. We look forward to the comments
and suggestions of operators and other interested stakeholders as this proposed rule
moves through the rulemaking process.
Finally, we expect to make available for public comment additional
proposed regulations to address the recommendations contained in our report of the investigation
into the Deepwater Horizon blowout. That report, issued last month, is the result of a collaborative
effort between BOEMRE and the Coast Guard. In order to ensure that we incorporate the very best
ideas and best practices of the offshore industry and other interested stakeholders in offshore
exploration, development and production, we will proceed through a notice and comment rulemaking
process that will begin with an Advance Notice of Proposed Rulemaking. It is our hope and
expectation that at the end of this process, we will develop consensus proposals that will
significantly enhance safety and environmental protection. Again, this is not a new announcement.
We have been discussing our intention to further enhance offshore safety regulation for
the past year. We have waited this long because we thought it was important to wait until
we were in a position to benefit from the insights and lessons learned from the joint investigation.
On previous occasions, I have mentioned other steps that we have taken
to enhance offshore safety and environmental protections. These include elaborating on requirements
that oil spill response plans include a well-specific blowout and worst-case discharge scenario,
and that operators demonstrate that they have access to, and can deploy, subsea containment
resources that would be sufficient to promptly respond to a deepwater blowout or other loss
of well control.
These enhanced requirements are substantial and necessary – and many
of them were long overdue. They have made the important enterprise of offshore exploration,
development and production safer and more environmentally responsible than ever before. And
the new regulations we are proposing and will propose are limited and common-sense elaborations
of the rules we have already put in place. We believe they will have the support of the operator
community, which shares our interest in promoting safe and responsible operations.
III. Maintaining Focus on Offshore Safety
We have accomplished a lot over the past 15 months – both in terms of structural and
regulatory reforms. Going forward, our challenge will be to ensure that our efforts to enhance
safety will not languish as the memory of the Deepwater Horizon accident fades into the past.
To this end, in January, Secretary Salazar established the Ocean Energy Safety Advisory Committee
to advise us on a broad range of issues related to offshore energy safety. This committee consists
of some of the brightest minds from industry, the academic community and government in the
United States. I have met with the committee, led by former Sandia Labs Director Tom Hunter,
on two occasions and am very pleased and impressed with their commitment to helping us address
these challenges. The Advisory Committee will assist BSEE, and we hope to receive a set of
preliminary recommendations from it in the near future. The Committee will hold a public meeting
next month to discuss these preliminary recommendations.
We are also working to strengthen our collaboration with our
international counterparts. Offshore regulators and senior policy officials around the
world have much to learn from each other to improve safety and environmental protection.
Over the past 15 months, we have taken a close look at the regulatory approaches of our
counterparts around the world and that exchange of information has proven invaluable.
The International Regulators' Forum has played a key role in fostering
this type of mutual learning on a multi-lateral scale. Since its founding in 1994, the IRF
has been an effective and necessary mechanism for building relationships and sharing
information among its member countries. Events like this conference are an extremely
valuable tool for regulators and industry to share information and learn from each other.
The United States has been a key participant in the IRF since its founding and will continue
to do so through the Bureau of Safety and Environmental Enforcement.
We also hope that we can keep the issue of offshore safety on the minds
and agendas of cabinet-level officials responsible for managing offshore resources
in a safe and responsible manner. In this spirit, last April, the Department of the
Interior hosted ministers and senior energy officials from twelve countries and the
European Union for the Ministerial Forum on Offshore Drilling Containment. This historic
meeting led to fruitful dialogue about cutting-edge, effective safety and containment
technologies. At the conclusion of the April meeting, delegates acknowledged the valuable
insights generated by the discussion and reaffirmed the importance of continued international
cooperation on issues related to offshore safety. They also discussed the need to continue
a dialogue about these issues at the highest levels of government. As events from the
recent past have shown, there is a compelling need for such a dialogue and for keeping
high-level officials informed about developments related to offshore safety. To this end,
we are working with our counterparts from a number of countries to create an ongoing
Ministerial Forum on Offshore Energy Safety. The hosts of this IRF conference,
our Norwegian friends, have agreed to host the next Ministerial Forum, which we
hope will take place next summer.
IV. Conclusion
All of us involved in reforming offshore safety regulations in the US and creating
our two new regulatory agencies – BOEM and BSEE – have worked to create
the structure, select the leadership, and work to obtain the resources needed to
fulfill our responsibilities to the American public. We need our people to approach
environmental reviews and regulatory enforcement in a way that is tough, but fair,
which places safety above all else, which promotes the responsible development
of our nation's energy resources, and ensures all reasonable steps are taken
to protect the fragile coastal and marine environment.
We need everyone to embrace those goals and to recognize their importance.
We cannot afford to have critics take liberties with the facts and act as though the only things that
matter are the rapid approval of plans and permits, whether or not they comply with the standards and
requirements that help ensure safety and environmental protection. Some may have forgotten
Deepwater Horizon or wish to pretend it either did not happen or that it was a singular
event that should not have a lasting impact on the way we do business. We recognize it as
a seminal event in the history of offshore drilling. It has driven much of what we have done
over the past fifteen months, and much of the agenda we will be pursuing in BOEM and BSEE as
we move forward.
It has been a difficult and challenging year-and-a-half,
for everyone involved with offshore energy development in the United States. As I look
back, I am extremely proud of what we have accomplished, and I am very optimistic
about what lies ahead. I firmly believe we can move forward, safely and responsibly,
and continue to work toward energy independence for our nation.
Thank you for your time and your attention. I am happy
to take any questions you might have in the time we have remaining.
Contact: BOEMRE
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