A federal judge in New Orleans Thursday denied the Obama administration’s request for a stay of the decision to block enforcement of the Interior Department’s sweeping moratorium on deepwater drilling in the Gulf of Mexico (GOM).
The Obama administration had sought the stay of U.S. District Court Judge Martin Feldman’s ruling pending an appeal. On Tuesday, Feldman granted Covington, LA-based Hornbeck Offshore Services LLC’s request for a preliminary injunction, barring the administration from enforcing the ban (see Daily GPI, June 23).
The judge ruled that Interior failed to justify its decision to impose a prolonged ban on deepwater drilling in the wake of the explosion on board the Deepwater Horizon rig, and essentially sought swift retribution against an entire industry for the actions of one company — British oil giant BP plc.
Feldman altered part of his Tuesday decision, giving Interior Secretary Ken Salazar and other Interior officials 30 days, rather than the original 21 days, to comply with terms of the order barring the enforcement of the moratorium on deepwater drilling until a full trial can be held on the merits of the case.
The judge also granted a motion seeking the disclosure of his financial interests, which became an issue after JudicialWatch reported that Feldman held stock in energy companies that were involved in the Deepwater Horizon incident (see Daily GPI, June 24a). “The court’s most current financial disclosure report will be released by the administrative office of the United States Courts as soon as their security protocol on the release of federal judge’s financial disclosure reports has been satisfied,” said the court order.
Feldman’s 2008 financial disclosure report published by JudicialWatch (a conservative watchdog over government, legal and judicial systems) showed that the he received dividends from Transocean stock that he held. Transocean owned the Deepwater Horizon rig that exploded on April 20 and ultimately sank off the southeastern coast of Louisiana. BP leased the rig from Transocean. The rig explosion and subsequent oil spill prompted the Obama administration to impose the moratorium in late May.
For the second day in a row, Salazar Thursday found himself before a Senate committee fending off a torrent of criticism aimed at the administration’s moratorium on deepwater drilling (see Daily GPI, June 24b).
The administration “has laid down a blanket, inappropriate…six-month moratorium with no end in sight,” Sen. Mary Landrieu (D-LA) said during a hearing of the Senate Energy and Natural Resources Committee. She urged Salazar to consider either shortening the duration of the moratorium or narrowing the scope of it.
In a recent letter to President Obama, Landrieu recommended that the 33 deepwater wells affected by the moratorium be allowed to immediately resume “top hole section” drilling. “This would allow them to drill through non-hydrocarbon zones, thus foregoing the possibility of loss-of-well control incidents or oil spills, Drilling would stop within a reasonable distance of the targeted hydrocarbon zone, to be reviewed for continuation as further regulations are developed,” she wrote.
“We’re looking at everything…I [originally] drew the demarcation at 500 feet because the shallow water drillers and others gave us the information that essentially gave us a sense of comfort,” Salazar told Landrieu.
“As we move forward looking at the moratorium across the Gulf Coast, we’re going to look at a number of different factors. And we’ll have some additional information to you [Landrieu] in the days ahead,” he said.
Most of the production “continues in the Gulf of Mexico,” Salazar noted. “There has been very little effect from the [Deepwater Horizon] blowout on the production of both oil and natural gas in the Gulf of Mexico.”
Landrieu estimated that approximately 4,000 wells are still producing in the GOM. “These have not been shut down.” While only 33 rigs are affected by the deepwater moratorium, she noted that each of those rigs has 1,400 workers onshore and offshore, or close to 46,200 in total.
Sen. Robert Bennett (R-UT) said that while he understood the administration’s impulse to want to impose a moratorium, he wasn’t sure a blanket moratorium would provide a higher degree of safety than a targeted moratorium.
Sen. John Barrasso (R-WY) criticized Interior for saying that the moratorium was peer-reviewed by experts who were consulted by the department during its safety review following the explosion of the Deepwater Horizon. He further charged that the presidential commission reviewing the rig accident was “stacked with people” who oppose offshore exploration.
Salazar made clear that the decision on the moratorium was out of the hands of the experts. Rather it was his and the president’s alone. And he said he was “confident this commission will do the job” and get to the “root” causes of the disaster.
The hearing was called by the Senate energy committee to review four separate bills related to the BP oil spill and the restructuring of the Bureau of Ocean Energy Management, Regulation and Enforcement (BOE), formerly the Minerals Management Service (MMS). Committee Chairman Jeff Bingaman (D-NM) said he hopes to mark up the bills next Wednesday.
“It’s my understanding that the bills will be considered individually in the committee,” said Bingaman spokesman Bill Wicker, but he added that they could be bundled together on the Senate floor.
One of the measures, sponsored by Bingaman, outlines the “multiple responsibilities” of Interior in managing the Outer Continental Shelf, recommends a plan for restructuring BOE, and increases the safety requirements for drilling wells, among other things (see Daily GPI, June 22). A second bill proposed by Sen. Scott Brown (R-MA) would require oil companies to have peer-reviewed response plans completed before leases are issued, and it would require the federal government to form a team of experts to respond to oil leaks in the future.
A measure offered by Sen. Mark Udall (D-CO) calls for the Department of Energy to refocus the aim of an existing program on research into technologies to improve well safety and accident prevention.
And legislation sponsored by Sen. Robert Menendez (D-NJ), a long-time foe of offshore drilling on the East Coast, would make it a felony for any employee of the MMS or its successor to knowingly accept high-value gifts from the oil and natural gas industry or any other industry covered under the term “mineral mining,” including transmission lines, pipelines and utility corridors.
It calls for violators to be fined or imprisoned for not more than two years, or both. The bill makes an exception for small gifts, allowing an employee to accept a single unsolicited gift of $20 or less and an aggregate amount of $50 for the entire year.
It also would require MMS employees to divest any stock or any other interests that they own in a company that is involved in the business of mineral mining while they are employed at the agency. And it would bar MMS workers from having outside employment with an oil and gas company or other “mineral mining” companies while at the agency.
The legislation, “Stop Cozy Relationships with Big Oil Act of 2010,” would make it a felony for MMS employees to work for industry before two years have lapsed since leaving the agency. This is an attempt to close the revolving door between the agency and the oil and gas industry.
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