GOP lawmakers skewer Interior chief on drilling oversight

By Juliana Gruenwald

July 23, 2010

Republicans on the House Oversight and Government Reform Committee grilled Interior Secretary Ken Salazar on Thursday over what they claimed was the Obama administration's failure to address potential problems with the agency charged with overseeing oil and gas drilling, problems they say may have contributed to the BP oil disaster in the Gulf of Mexico.

During a hearing on the government's oversight of deep-water drilling, Republicans noted that while the Bush administration did not provide adequate oversight either, the Obama administration had more than a year to try to fix known problems at the Interior Department's Minerals Management Service before the April explosion aboard the Deepwater Horizon oil rig.

In the wake of the accident, Salazar announced in May a plan to reorganize the MMS by splitting up the bureau's resource management, safety, environmental oversight, enforcement and revenue collection duties into three separate entities.

Oversight and Government Reform Commitee ranking member Rep. Darrell Issa, R-Calif., however, argued that such changes are too little, too late and are more aimed at improving the administration's image.

"These problems were well known during the Bush administration," Issa said. "But sadly, during the year and a half of your administration, change did not occur." He added that had some of the changes been put in place before the April explosion, he believes the BP oil disaster "could have been prevented."

Other lawmakers noted Salazar was on the job when the permit for BP's deep-water well was issued and also outlined the failure of MMS to make mandated inspections of the Deepwater Horizon rig.

Rep. John Mica, R-Fla., questioned why the administration proposed cutting funding for MMS and for disaster-response resources at the Coast Guard in its fiscal 2011 budget, while Rep. Dan Burton, R-Ind., criticized Salazar for not visiting some of the areas in the Gulf hurt most by the oil disaster.

Salazar repeated an assertion he made on Tuesday before a House Energy and Commerce subcommittee that there is "collective responsibility" for the Gulf oil disaster. "I do not believe, at the end of the day, the blame game will help us move forward," he said.

He also defended the administration's actions, saying he was focused on reforming MMS from his first days in office. Salazar said he has submitted a supplemental budget for fiscal 2011 seeking additional funding to hire more offshore oil well inspectors. On his response to the oil spill, Salazar said he has visited the Gulf 11 times, while other top officials have made many visits as well.

Oversight and Government Reform Committee Chairman Rep. Edolphus Towns, D-N.Y., noted that while offshore drilling grew rapidly over the last two decades, staffing levels at MMS did not keep pace. Towns asked Salazar what the agency is doing to attract qualified engineers and to prevent MMS staff from leaving to work for the oil industry.

"The revolving door is [an issue] we have looked at and it has troubled us," Salazar said.

Michael Bromwich, director of the new Bureau of Ocean Energy Management, Regulation and Oversight, one of the three agencies that will succeed MMS, said he has begun looking at ways to expand the pool of inspectors and make the job more attractive.

Democrats pressed Salazar on what he is doing to increase the amount of royalties the federal government takes in from oil and gas production. They pointed to a 2008 Government Accountability Office report that showed the United States receives among the lowest shares of revenue from oil and gas leasing resources in the world.

Salazar said Interior is working on plans to increase U.S. royalties by, among other things, eliminating the royalty-in-kind program that allowed companies to provide oil and gas to the U.S. government in lieu of revenues.

Salazar also was asked what the agency is doing to get a more accurate accounting of the amount of oil and gas being extracted so that the federal government is adequately compensated. MMS had been relying on oil companies to calculate and submit the royalties they owe. Salazar and Bromwich said the agency is putting in place a process for independently calculating what the government is owed in royalties.

By Juliana Gruenwald

July 23, 2010