For Immediate Release: Contact: Nicolette Nye
Thursday, July 15, 2010 (202) 347-6900
NOIA Comments on CLEAR Act and BOP Act
WASHINGTON, DC – While the establishment of a program to assist the Gulf region recovery is a very worthy intent, the CLEAR Act (HR 3534) will also have some very undesirable results for the American economy. In fact, the Act will clear the way for increased energy costs, more reliance on foreign energy sources, and the loss of more American jobs.
NOIA is disappointed by the House Natural Resources Committee’s rejection of the amendment by Representative Bill Cassidy to end the drilling moratorium – a moratorium which has twice been rejected by the courts and is costing thousands of jobs In the Gulf of Mexico.
The Gulf spill certainly demands that tough questions be asked and new policies and standards be considered, but this legislation goes well beyond a response to the spill and capriciously raises costs on domestic offshore production. Thoughtful legislative responses to the Gulf spill must consider the economic impact of the oil and gas industry in the Gulf and on the national economy as a whole. On those counts, this bill falls short.
There are substantial areas where almost all interested parties have agreement in providing increased safety for offshore exploration activities. However, instead of gathering those areas and moving forward, this bill overreaches and is attempting to provide solutions with unintended consequences.
Now is the time for pragmatic, calm, rationale debate on the best ways to prevent a similar tragedy from ever happening again, and continuing to allow offshore energy development to be a critical component of our national energy portfolio.
Notably, the House Natural Resources Committee did adopt, by a bipartisan vote, an amendment by Congressman Bill Cassidy to establish a bipartisan, Congressionally-appointed Commission to investigate the causes of the Gulf tragedy, incorporate findings of other such investigations, and make policy recommendations going forward. If Congress must act, NOIA recommends they pass this amendment.
However, we note, that coming on the heels of an identical amendment being adopted by the Senate Energy and Natural Resources Committee, this action calls attention to the impartiality of the Presidential Commission.
As for the Blowout Prevention Act (HR 5626), as earlier stated, NOIA appreciates that there are substantial areas where almost all interested parties have agreement in providing increased safety for offshore exploration activities, including with regard to blowout preventers. NOIA will continue working with the House Energy and Commerce Committee as the bill moves forward to ensure that new BOP standards are achievable and result in safer operations. To that end, NOIA is concerned with the scope of the bill, which treats every single offshore exploration well as a high-risk well, neglecting to take into account various factors such as water depth, total well depth, pressure, temperature, and well control mechanisms. While NOIA applauds the exclusion of production wells from the bill’s requirements, such a one-size-fits-all approach to exploration wells precludes the regulatory flexibility needed to recognize unique well conditions, and thus does not best ensure safer operations.
Meanwhile, members of NOIA and the oil and gas industry as a whole are continuing to work tirelessly to assist in the containment and clean up of the oil, as they have since April 20. The industry has also done a top to bottom review of safety procedures to guard against a similar accident now and in the future. As part of this top to bottom review, industry has voluntarily suggested additional safety checks and backups to regain the public’s confidence in offshore exploration.
In addition, NOIA, the American Petroleum Institute, the International Association of Drilling Contractors, the Independent Petroleum Association of America and the United States Oil and Gas Association and industry have joined together and convened task forces to address spill containment and spill response. NOIA and its members stand ready to provide assistance and suggestions to find safe and sensible solutions. We welcome the opportunity to provide constructive input to the Department during their upcoming meetings with industry.
NOIA is the only national trade association representing all segments of the offshore industry with an interest in the exploration and production of both traditional and renewable energy resources on the nation’s outer continental shelf. The NOIA membership comprises more than 250 companies engaged in business activities ranging from producing to drilling, engineering to marine and air transport, offshore construction to equipment manufacture and supply, telecommunications to finance and insurance.