Trump ad­min­is­tra­tion aims to ease off­shore rules

En­vi­ron­men­tal, safety ad­vo­cates say moves aren’t worth risks.

Austin American-Statesman Sunday - - FRONT PAGE - Eric Lip­ton

PORT FOURCHON, LA. — A dozen miles off the coast, on a rusty, ag­ing plat­form, work­ers in hard hats and over­alls spend their days ex­tract­ing oil and gas from the ocean floor be­fore re­treat­ing at night into tiny weather-beaten steel cubes that act as dorms.

The plat­form, owned by a Hous­ton-based en­ergy com­pany that un­til re­cently was bank­rupt, has none of the grandeur — or prof­its — of the deep-sea struc­tures over 100 miles off­shore that are op­er­ated by in­ter­na­tional giants such as Exxon Mo­bil and Chevron.

But the com­pany, En­ergy XXI, and other strug­gling op­er­a­tors in the shal­low wa­ters of the Gulf of Mex­ico are ben­e­fi­cia­ries of the Trump ad­min­is­tra­tion’s ef­forts to in­crease off­shore pro­duc­tion here — in large part by up­end­ing fi­nan­cial, en­vi­ron­men­tal and safety reg­u­la­tions that the com­pa­nies op­pose.

While at­ten­tion has been fo­cused on Pres­i­dent Don­ald Trump’s dis­puted de­ci­sion in Jan­uary to re­verse drilling re­stric­tions in nearly all U.S. coastal wa­ters, the ad­min­is­tra­tion has also pur­sued a roll­back of Obama-era reg­u­la­tions in the Gulf. Those rules in­clude safety mea­sures put in place af­ter the ex­plo­sion and sink­ing of the Deep­wa­ter Hori­zon rig in 2010, a disas­ter that killed 11 peo­ple and re­sulted in the largest marine oil spill in drilling his­tory.

Smaller oil and gas com­pa­nies, many backed by Wall Street and pri­vate eq­uity firms, say they need the relief to sur­vive fi­nan­cially, and the top safety of­fi­cial at the In­te­rior De­part­ment ap­pointed

by Trump has ap­peared to be an en­thu­si­as­tic ally.

“Help is on the way; help is on the way,” the of­fi­cial, Scott An­gelle, said in Septem­ber at a gath­er­ing in Lafayette, Louisiana, of oil and gas ex­ec­u­tives from so-called in­de­pen­dent com­pa­nies, which fo­cus on drilling alone rather than the ex­tended drilling-to-gassta­tion op­er­a­tions of big­ger com­peti­tors.

But an anal­y­sis of fed­eral in­spec­tion data by The New York Times found that sev­eral of the in­de­pen­dent com­pa­nies seek­ing the roll­back, in­clud­ing En­ergy XXI, had been cited for work­place safety vi­o­la­tions in re­cent years at a rate much higher than the in­dus­try av­er­age. Their off­shore plat­forms suf­fer in some cases from years of poor main­te­nance, as well as equip­ment fail­ures or metal fa­tigue on ag­ing de­vices, records show.

In ad­di­tion, there was a string of se­ri­ous en­vi­ron­men­tal and safety episodes in the past six months in­volv­ing in­de­pen­dent op­er­a­tors, in­clud­ing the death in Fe­bru­ary of a worker who was re­mov­ing fire­fight­ing equip­ment from a plat­form about 30 miles off­shore, and an oil spill in Oc­to­ber that is con­sid­ered the largest since the Deep­wa­ter Hori­zon episode, ac­cord­ing to In­te­rior De­part­ment records.

“These reg­u­la­tions were writ­ten with hu­man blood,” said Lil­lian Espinoza-Gala, a for­mer off­shore worker who now serves as an in­dus­try safety con­sul­tant and op­poses eas­ing pro­tec­tions. “The only way we can honor those who lost their lives is for us to learn how to do this in the cor­rect way.”

But An­gelle has close per­sonal and re­cent ties to the oil and gas in­dus­try, par­tic­u­larly the smaller com­pa­nies seek­ing his in­ter­ven­tion.

Now he is the top of­fi­cial at the In­te­rior De­part­ment’s Bureau of Safety and En­vi­ron­men­tal En­force­ment, a divi­sion cre­ated un­der Pres­i­dent Barack Obama to toughen safety stan­dards and en­force­ment in off­shore drilling be­cause of prob­lems ex­posed by the Deep­wa­ter Hori­zon ac­ci­dent. An­gelle spent his first months on the job, records show, trav­el­ing be­tween Wash­ing­ton, Texas and his na­tive Louisiana to meet with ex­ec­u­tives at most of the top off­shore oil com­pa­nies, in­clud­ing some re­peat­edly cited for safety vi­o­la­tions.

“What ap­pears to be go­ing on is a re­def­i­ni­tion of the agency’s mis­sion,” said Michael R. Bromwich, a for­mer fed­eral pros­e­cu­tor and in­spec­tor gen­eral at the Jus­tice De­part­ment who be­came the first head of the bureau in May 2010. “This is a safety and en­vi­ron­men­tal pro­tec­tion agency. It is not part of the agency’s mis­sion or man­date to in­crease pro­duc­tion of oil or gas. That is in­ap­pro­pri­ate.”

An­gelle de­clined to be in­ter­viewed for this ar­ti­cle. But in a writ­ten state­ment, he dis­puted that his agency had backed off its com­mit­ment to safety. “We must never have another Deep­wa­ter Hori­zon or any­thing close to it,” An­gelle said.

An agency spokes­woman said that all Amer­i­cans ben­e­fited from his ef­forts.

“The work we are do­ing in BSEE ben­e­fits the en­tire na­tion, and we are sup­port­ing the pres­i­dent’s ob­jec­tive of safely achiev­ing en­ergy dom­i­nance in order to con­trib­ute to na­tional se­cu­rity, eco­nomic se­cu­rity and en­ergy se­cu­rity,” said Eileen An­gelico, the spokes­woman.

The agency is start­ing an en­force­ment ef­fort that will fo­cus in­spec­tors on plat­forms with the most fre­quent prob­lems, re­duc­ing pa­per­work re­quire­ments so they can spend more time on check­ing equip­ment.

But agency doc­u­ments sug­gest moves he has al­ready made could save the in­dus­try more than $1.3 bil­lion in com­pli­ance costs dur­ing the next decade.

The In­te­rior De­part­ment has joined the ef­fort more broadly. Last year, the de­part­ment sus­pended a re­quire­ment im­posed on Gulf rig own­ers, a change that will save them hun­dreds of mil­lions of dol­lars. The rule re­quired own­ers to buy ad­di­tional bonds or pro­vide other as­sur­ance that they could cover the costs of re­mov­ing rigs once they stopped pro­duc­ing.

The rule was meant to keep tax­pay­ers from hav­ing to pick up the tab, but a col­lec­tion of op­er­a­tors last year — with help from high-pro­file lob­by­ists — con­vinced the Trump ad­min­is­tra­tion that the re­quire­ment was too oner­ous. The change has mostly ben­e­fited in­de­pen­dents like En­ergy XXI.

Sep­a­rately, the ad­min­is­tra­tion has re­duced the roy­al­ties in­de­pen­dent com­pa­nies pay when drilling on new leases on the con­ti­nen­tal shelf, the shal­low area of the Gulf be­fore the ocean floor drops more than a mile deep.

Even as safety has im­proved for the in­dus­try as a whole, some in­de­pen­dent op­er­a­tors have lagged sig­nif­i­cantly be­hind, fed­eral records show.

The most se­ri­ous of­fenses in­volved Black Elk En­ergy Off­shore Op­er­a­tions, which was con­victed in Au­gust of eight felony vi­o­la­tions re­lated to a plat­form ex­plo­sion that killed three work­ers and in­jured sev­eral oth­ers. It has since gone out of busi­ness, one of at least 19 oil and gas com­pa­nies in the Gulf to go bank­rupt since 2015.

Rep­re­sen­ta­tives from En­ergy XXI de­clined re­peated re­quests for com­ment.

‘Al­ways the work­ers who pay’

Oil and gas com­pa­nies pushed to un­ravel a ma­jor safety re­quire­ment known as the well-con­trol rule, which reg­u­lates meth­ods used to drill new oil and gas wells — and pre­vent ex­plo­sions.

It took six years af­ter the Deep­wa­ter Hori­zon ac­ci­dent to en­act the rule, which took ef­fect in July 2016.

At a meet­ing An­gelle called in Septem­ber, in­dus­try of­fi­cials de­tailed their ob­jec­tions while mem­bers of staff — some of whom helped write the rule — sat tak­ing notes.

In late De­cem­ber, An­gelle sent the White House a pro­posal to over­haul the well-con­trol rule, es­ti­mat­ing that oil com­pa­nies would save $986 mil­lion in the com­ing decade. The pro­posal in­cluded many changes re­quested by the in­dus­try.

“Oil and nat­u­ral gas op­er­a­tors raised con­cerns about cer­tain reg­u­la­tory pro­vi­sions that im­pose un­due bur­dens on their in­dus­try, but do not sig­nif­i­cantly en­hance worker safety or en­vi­ron­men­tal pro­tec­tion,” said the con­fi­den­tial draft, a copy of which was ob­tained by The Times.

Though the pro­posal is un­der­go­ing a re­view be­fore the re­vi­sions are made pub­lic, the White House has made clear that it wel­comes the ef­fort. A White House spokes­woman de­clined to com­ment.

To some long­time res­i­dents and ac­tivists, the changes are not worth the pos­si­ble trade­offs in safety and en­vi­ron­men­tal pro­tec­tions.

“It’s al­ways the work­ers who pay,” said Scott Eustis of the Gulf Restora­tion Net­work, an en­vi­ron­men­tal group.

The Gulf gen­er­ates 97 per­cent of off­shore oil in the United States, about 18 per­cent of the coun­try’s crude oil and $2.8 bil­lion a year in roy­alty and lease pay­ments to the fed­eral gov­ern­ment.

In early March, the num­ber of drilling rigs used in the Gulf was just 14, com­pared with 145 at the in­dus­try’s peak in 2000.

The down­turn was set off by a drop in oil prices, com­pe­ti­tion from frack­ing and other sources and, lo­cal busi­nesses will tell you, an over­bear­ing reg­u­la­tory re­ac­tion to Deep­wa­ter Hori­zon.

The pri­mary con­cern voiced here is eco­nomic.

“Half the sup­ply boats and crew boats up and down the bayou have been seized by the banks,” said Kath­leen Chi­as­son, who once ran a truck-dis­patch­ing com­pany that supplied the in­dus­try. “I just hope some­one can do it to get it back to at least half the way it used to be.”


Some of the rule roll­backs in­clude Obama-era reg­u­la­tions in the Gulf — safety mea­sures that were put in place af­ter the ex­plo­sion and sink­ing of the Deep­wa­ter Hori­zon rig in 2010, a disas­ter that killed 11 peo­ple and re­sulted in the largest marine oil spill in drilling his­tory.


In Port Fourchon, La., John Guidry and Capt. Sean San­dell talk on an off­shore sup­ply ship owned by Aries Marine, which re­pairs plat­forms in shal­low wa­ters.

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