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57-230 PDF 2010

DISCUSSION DRAFT, 

AMENDMENT IN THE NATURE 

OF A SUBSTITUTE TO H.R. 3534, 

DATED JUNE 22, 2010 (5:25 P.M.) 

LEGISLATIVE HEARING 

BEFORE THE

COMMITTEE ON NATURAL RESOURCES 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

Wednesday, June 30, 2010 

Serial No. 111-61 

Printed for the use of the Committee on Natural Resources 

( 

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html 

or 

Committee address: http://resourcescommittee.house.gov 

(II) 

COMMITTEE ON NATURAL RESOURCES 

NICK J. RAHALL, II, West Virginia, Chairman 

DOC HASTINGS, Washington, Ranking Republican Member 

Dale E. Kildee, Michigan 

Eni F.H. Faleomavaega, American Samoa 

Frank Pallone, Jr., New Jersey 

Grace F. Napolitano, California 

Rush D. Holt, New Jersey 

Rau ́l M. Grijalva, Arizona 

Madeleine Z. Bordallo, Guam 

Jim Costa, California 

Dan Boren, Oklahoma 

Gregorio Sablan, Northern Marianas 

Martin T. Heinrich, New Mexico 

Ben Ray Luja ́n, New Mexico 

George Miller, California 

Edward J. Markey, Massachusetts 

Peter A. DeFazio, Oregon 

Maurice D. Hinchey, New York 

Donna M. Christensen, Virgin Islands 

Diana DeGette, Colorado 

Ron Kind, Wisconsin 

Lois Capps, California 

Jay Inslee, Washington 

Joe Baca, California 

Stephanie Herseth Sandlin, South Dakota 

John P. Sarbanes, Maryland 

Carol Shea-Porter, New Hampshire 

Niki Tsongas, Massachusetts 

Frank Kratovil, Jr., Maryland 

Pedro R. Pierluisi, Puerto Rico 

Don Young, Alaska 

Elton Gallegly, California 

John J. Duncan, Jr., Tennessee 

Jeff Flake, Arizona 

Henry E. Brown, Jr., South Carolina 

Cathy McMorris Rodgers, Washington 

Louie Gohmert, Texas 

Rob Bishop, Utah 

Bill Shuster, Pennsylvania 

Doug Lamborn, Colorado 

Adrian Smith, Nebraska 

Robert J. Wittman, Virginia 

Paul C. Broun, Georgia 

John Fleming, Louisiana 

Mike Coffman, Colorado 

Jason Chaffetz, Utah 

Cynthia M. Lummis, Wyoming 

Tom McClintock, California 

Bill Cassidy, Louisiana 

James H. Zoia, Chief of Staff 

Rick Healy, Chief Counsel 

Todd Young, Republican Chief of Staff 

Lisa Pittman, Republican Chief Counsel 

(III) 

CONTENTS 

Page 

Hearing held on Wednesday, June 30, 2010 ......................................................... 1 

Statement of Members: 

Hastings, Hon. Doc, a Representative in Congress from the State of 

Washington .................................................................................................... 3 

Rahall, Hon. Nick J., II, a Representative in Congress from the State 

of West Virginia ............................................................................................ 1 

Prepared statement of ............................................................................... 2 

Statement of Witnesses: 

Bromwich, Hon. Michael R., Director, Bureau of Ocean Energy 

Management, Regulation, and Enforcement (BOE), U.S. Department 

of the Interior ................................................................................................ 17 

Prepared statement of ............................................................................... 18 

Response to questions submitted for the record ..................................... 12 

Dismukes, David E., Ph.D., Professor, Associate Executive Director, and 

Director of Policy Analysis, Center for Energy Studies, Louisiana State 

University ...................................................................................................... 74 

Prepared statement of ............................................................................... 75 

Jones, Janis, Vice President of Programs, Ocean Conservancy ................... 65 

Prepared statement of ............................................................................... 66 

Salazar, Hon. Ken, Secretary, U.S. Department of the Interior ................... 5 

Prepared statement of ............................................................................... 6 

Response to questions submitted for the record ..................................... 12 

Additional materials supplied: 

Blancett Ranches, Aztec, New Mexico, Letter submitted for the record ..... 97 

Broun, The Honorable Paul, Ranking Member, Subcommittee on 

Investigations and Oversight, Committee on Science and Technology, ...

Letter to The President submitted for the record .................................. 33 

Letter to Secretary of the Interior Ken Salazar submitted for the 

record ...................................................................................................... 35 

Costner, Kevin, Founder, CINC, Co-Founder/Partner, Ocean Therapy 

Solutions, WestPac Resources, Statement submitted for the record ........ 76 

Jindal, The Honorable Bobby, Governor, State of Louisiana, Letter to 

Secretary of the Interior Ken Salazar submitted for the record ............... 43 

List of documents retained in the Committee’s official files ......................... 98 

Meadows, William H., The Wilderness Society, Letter submitted for the 

record ............................................................................................................. 98 

National Federation of Regional Associations for Coastal and Ocean 

Observing, Letter submitted for the record ................................................ 100 

The Nature Conservancy, Statement submitted for the record .................... 81 

Peterson-Cremer, Richard, Legislative Director, Southern Utah 

Wilderness Alliance, Letter submitted for the record ................................ 102 

Powder River Basin Resource Council, Letter submitted for the record ..... 103 

Schweiger, Larry, President & CEO, National Wildlife Federation, Letter 

submitted for the record ............................................................................... 104 

Section-by-Section Analysis of Discussin Draft .............................................. 105 

Steuer, Karen, Director, Government Relations, PEW Environment 

Group, Letter submitted for the record ....................................................... 79 

Summary of the Discussion Draft ................................................................... 114 

Sweeney, Pat, Director, Western Organization of Resource Councils, 

Letter submitted for the record ................................................................... 116 

Theodore Roosevelt Conservation Partnership, including the American 

Sports Fishing Association, North American Grouse Partnership, Pope 

and Young Club, Quality Deer Management Association, Trout 

Unlimited, The Wildlife Society, and Wild Sheep Foundation,Letter 

submitted for the record ............................................................................... 118 

(1) 

LEGISLATIVE HEARING ON THE ‘‘DISCUSSION 

DRAFT, AMENDMENT IN THE NATURE OF A 

SUBSTITUTE TO H.R. 3534, DATED JUNE 22, 

2010 (5:25 P.M.)’’ 

Wednesday, June 30, 2010 

U.S. House of Representatives 

Committee on Natural Resources 

Washington, D.C. 

The Committee met, pursuant to call, at 10:05 a.m. in Room 

1324, Longworth House Office Building, The Honorable Nick J. 

Rahall, II, [Chairman of the Committee] presiding. 

Present: Representatives Rahall, Napolitano, Holt, Grijalva, 

Bordallo, Costa, Boren, Heinrich, Lujan, Miller, Markey, 

Christensen, DeGette, Kind, Capps, Inslee, Baca, Sarbanes, SheaPorter, Tsongas, Kratovil, Pierluisi, Hastings, Gallegly, Brown of 

South Carolina, McMorris Rodgers, Gohmert, Lamborn, Smith, 

Wittman, Broun of Georgia, Fleming, Coffman, Lummis, 

McClintock, and Cassidy. 

STATEMENT OF HON. NICK J. RAHALL, II, A REPRESENTATIVE 

IN CONGRESS FROM THE STATE OF WEST VIRGINIA 

The CHAIRMAN. The Committee on Natural Resources will come 

to order. Just as a way of housekeeping, I am sure all Members 

already know it, at approximately 10:30 a.m. we are going to have 

four votes on the House Floor so we can plan accordingly. 

The Committee is meeting today to conduct a hearing on Discussion Draft Amendment in the Nature of a Substitute to H.R. 3534, 

the CLEAR Act. The CLEAR Act, introduced last year, was the 

subject of two days of hearings last September and was developed 

as a result of a long series of investigations, hearings and prior legislative efforts into the pressing need to reform both the offshore 

and onshore oil and gas leasing program. 

Since I became Chairman of this Committee in 2007, we have 

held 20 hearings, had nine GAO reports done, and passed three 

bills out of the House during the last Congress, prior to the introduction of the CLEAR Act on matters it concerns. 

The focus of the introduced version of this legislation is on royalty reform and enhanced planning processes for energy development on the Outer Continental Shelf, and an improved means to 

make Federal lands available for renewable energy leasing. The 

bill also seeks to fully fund the Land and Water Conservation 

2 

Fund, and establish a new oceans restoration fund based on the 

premise that we take everything from the ocean, but we put nothing back into it. 

Further, it would have eliminated the Minerals Management 

Service and replaced it with a new entity. The disaster, which 

struck the Gulf of Mexico beginning on April 20th, was indeed a 

game changer. As a result of a number of hearings by this Committee since that date, intensive investigations and review of documents submitted by all the parties involved in the Deepwater Horizon incident, the Substitute retains, but builds upon, the introduced version of H.R. 3534 in three main respects. 

First, it includes a focus on safety, not in a prescriptive fashion, 

which I believe may lead to freezing the development of new technology in its place, but in a more performance-based approach that 

mirrors the successful efforts of other countries, such as Norway 

and the United Kingdom. 

Second, taking a lead from our witness today, the Secretary of 

the Interior Ken Salazar, it replaces the former Minerals Management Service with three entities, separating leasing, policing, and 

revenue management, and provides an organic act for the new 

Bureau of Energy and Resources Management, Bureau of Safety 

and Environmental Enforcement, and Office of Natural Resources 

Revenue. 

And third, the Substitute would establish a Gulf of Mexico Restoration Program to provide an explicit statutory basis for what 

will be a long-term effort to address the devastating impacts of the 

Deepwater Horizon disaster on the environment and on local 

communities. 

And I would note that none of the funds authorized or made 

available under the Substitute may be used to pay for any cost for 

which BP is liable. I would like to emphasize that the heading of 

the Substitute clearly reads ‘‘Discussion, Draft’’, ‘‘Discussion, 

Draft’’. It was made available one week ago and we will not go to 

markup until July 14. Therefore, I am providing ample opportunity 

for all interested parties to provide us with their views on this document, and I hope that will go out to members of the Committee 

that are not physically present today via their staffs. 

I urge my colleagues who wish to see changes or offer amendments to the Substitute to contact the Committee as soon as possible as the markup will occur on the second day after we return 

from the July 4th recess, and I would like to be able to provide the 

markup vehicle to the Committee as soon as possible prior to our 

return. 

[The prepared statement of Chairman Rahall follows:] 

Statement of The Honorable Nick J. Rahall, II, Chairman, 

Committee on Natural Resources 

The Committee is meeting today to conduct a hearing on a Discussion Draft of 

an Amendment in the Nature of a Substitute to H.R. 3534, the CLEAR Act. 

The CLEAR Act, introduced last year, was the subject of two days of hearings last 

September and was developed as a result of a long series of investigations, hearings 

and prior legislative efforts into the pressing need to reform both the offshore and 

onshore oil and gas leasing program. Since I became chairman of this committee in 

2007, we have held 20 hearings, had nine GAO reports done, and passed three bills 

out of the House during the last Congress prior to the introduction of the CLEAR 

Act on matters it concerns. 

3 

The focus of the introduced version of this legislation is on royalty reform, an enhanced planning process for energy development on the Outer Continental Shelf, 

and an improved means to make federal lands available for renewable energy leasing. The bill also seeks to fully fund the Land and Water Conservation Fund, and 

establishes a new oceans restoration fund based on the premise that we take everything from the ocean, but put nothing back into it. Further, it would have eliminated the Minerals Management Service and replaced it with a new entity. 

The disaster which struck the Gulf of Mexico beginning on April 20th was a game 

changer. As a result of a number of hearings by this committee since that date, intensive investigations and review of documents submitted by all of the parties involved in the Deepwater Horizon incident, the Substitute retains, but builds upon, 

the introduced version of H.R. 3534 in three main aspects. 

First, it includes a focus on safety, not in a prescriptive fashion which I believe 

may lead to freezing the development of new technology in its place, but in a more 

performance-based approach that mirrors the successful efforts of other countries, 

such as Norway and the United Kingdom. 

Second, taking a lead from Secretary Salazar, it replaces the former Minerals 

Management Service with three entities separating leasing, policing and revenue 

management and provides an organic act for the new Bureau of Energy and Resource Management, Bureau of Safety and Environmental Enforcement and Office 

of Natural Resources Revenue. 

And third, the Substitute would establish a Gulf of Mexico Restoration Program 

to provide a explicit statutory basis for what will be a long-term effort to address 

the devastating impacts of the Deepwater Horizon Disaster on the environment and 

local communities. And I would note that none of the funds authorized or made 

available under the Substitute may be used to pay for any cost for which BP is liable. 

I would like to emphasize that the heading of the Substitute clearly reads ‘‘Discussion Draft.’’ It was made available one week ago, and we will not go to markup 

until July 14th. I am providing ample opportunity for all interested parties to provide us with their views on this document. I urge my colleagues who wish to see 

changes or offer amendments to the Substitute to contact the Committee as soon 

as possible as the mark-up will occur on the second day after we return from the 

July 4th recess, and I would like to be able to provide the mark-up vehicle to the 

Committee as soon as possible prior to our return. 

The CHAIRMAN. I now recognize the Ranking Member Mr. Hastings of Washington. 

STATEMENT OF HON. DOC HASTINGS, A REPRESENTATIVE IN 

CONGRESS FROM THE STATE OF WASHINGTON 

Mr. HASTINGS. Thank you, Mr. Chairman. 

Mr. Chairman, this hearing today should continue to focus on the 

crisis unfolding in the Gulf of Mexico because at this very moment 

the well is not capped and oil is still leaking. Oil is washing onto 

wetlands and beaches, threatening the environment and the wildlife, families are out of work, businesses are struggling to make 

ends meet, and the Gulf states are still struggling to get the resources they need to respond to the spill. 

Unfortunately, instead of addressing the immediate crisis at 

hand there have been attempts to use this tragedy to impose a jobkilling capital trade national energy tax and push legislation that 

is unrelated to the spill, or reforms in offshore drilling. 

Just yesterday President Obama’s senior energy and environmental advisor, Carol Browner, wrote an e-mail message advocating, and I quote in part, ‘‘The disaster in the Gulf be used to 

end our addiction to fossil fuels and pass comprehensive energy 

and climate legislation.’’ The ongoing attempt by Democrats to exploit this crisis in order to push a national energy tax is clearly 

their best effort not to let a crisis go to waste, but it will not stop 

the leak, it will not provide relief to the people struggling in the 

4 

Gulf. It will, however, make the problem worse by increasing 

energy prices for all Americans and sending American jobs and 

companies overseas. 

The bill we are discussing today was promoted as addressing the 

Deepwater Horizon rig explosion. However, most of its 200 pages 

have very little to do with this explosion and bill. There are numerous provisions completely unrelated to offshore drilling safety, and 

reform. Reforms are clearly needed to make American offshore 

drilling the safest in the world, but Congress should not get ahead 

of the facts and in a rush to write new laws. 

Mr. Chairman, if all of us were to ask ourselves if we believe we 

have all the facts and information necessary to know exactly what 

changes need to be made in offshore drilling, the only honest answer is no. There is too much we don’t know yet. There are bipartisan document requests that have gone unanswered by the Administration regarding the government’s oversight of this specific well. 

This includes the last inspection report on the blowout preventer. 

Information has come to light about human errors that contributed 

to the explosion, but we still don’t know why the emergency shutoff 

failed to work. 

The blowout preventer is still a mile from the ocean surface, and 

we won’t likely have the answers on what went wrong until it is 

retrieved and examined. Numerous investigations are underway, 

including the Presidential Commission, which has yet to even hold 

its first meeting. Why spend taxpayers’ dollars on this commission 

if Congress has no intention of reviewing and considering its report 

and finding. 

Congress must know what caused the disaster and then respond 

appropriately. This will ensure that Congress is not just making reforms for headlines and for political purposes, but making the right 

reforms to ensure that American drilling is the safest in the world. 

Finally, it is vital that in these tough economic times that Congress knows what effect proposed new laws will have on American 

jobs, our economy, and our dependence on foreign energy. As we 

have seen from the Administration’s moratorium on deep well drilling, impulsive decisions can have severe, long-term economic impacts. Solutions are supposed to help improve the situation in the 

Gulf, not make it worse. Congress must take extra care to ensure 

that any reforms will not cause greater economic damage than is 

already being felt as a result of this spill. 

With that, Mr. Chairman, I will yield back my time. 

The CHAIRMAN. The Chair will move directly now to hear from 

our first panel composed of The Honorable Ken Salazar, the 

Secretary, U.S. Department of the Interior, and he is accompanied 

by, and I understand the Director will have a statement to make 

as well, The Honorable Michael R. Bromwich, the Director of the 

Bureau of Ocean Energy Management, Regulation, and Enforcement, otherwise known as BOE, from the U.S. Department of the 

Interior. 

Mr. Secretary, we welcome you once again to the Committee, and 

as I have done many times publicly, I commend you and your Department for the tremendous manner in which you have responded 

to this disaster. You have put all your resources available, and I 

commend you for that response. You may proceed as you desire. 

5 

STATEMENT OF HON. KEN SALAZAR, SECRETARY, 

U.S. DEPARTMENT OF THE INTERIOR 

Secretary SALAZAR. Thank you very much, Chairman Rahall, and 

Ranking Member Hastings, and distinguished members of this 

Committee. 

We continue our efforts on this day 71 with what has been a relentless effort to deal with the problem that we see unfolding in the 

Gulf. At the President’s direction, we are not resting, and we will 

continue to move forward until we have the solutions, both with respect to the leak containment as well as continuing the reform efforts that we have been undertaking. I thought I would do a couple 

of things at the outset. First, bring the Committee up to date on 

what is happening with respect to the leak containment and the efforts to kill the well. 

First, on the containment measures, in the last 24 hours about 

25,000 barrels of oil were actually collected and contained and have 

been captured notwithstanding some high seas that have been as 

high as seven feet, and so that interim containment system is 

working. 

Second, over the next few days the containment capacity that 

will be built out that we have been overseeing and working on will 

reach a capacity of 40 to 53 thousand barrels a day, and by midJuly the capacity that will be built out will be 60 to 80 thousand 

barrels a day. 

As a part of the effort of the Federal team, which includes Secretary Chu and myself, the Navy and others who have been involved in this effort from the beginning, including our oversights at 

Houston, we have ordered these measures to be taken by BP so 

that we get the full leak containment and also that there are 

redundancies and efforts put into place that deal with contingencies hurricanes, and our hope is that moving into mid-July the 

60 to 80 thousand barrels of oil will be able to be contained, most 

of the pollution currently emanating in the Gulf of Mexico, and 

then moving upwards from there with additional redundancies that 

are also being planned up to about 90,000 barrels a day if that 

should ever be needed. 

Second, we have always known that ultimately the solution here 

is to kill this well, and as of this morning the current depth is now 

over 17,000 feet through the relief well. The relief well has a target 

of 17,758 feet. So in the next several weeks they will be getting 

down to the target depth, and then hopefully the efforts to kill this 

well will then move forward. 

So that is a quick update on what is happening with respect to 

at least the source containment. There are huge efforts underway 

to fight the oil on the sea and near shore and onshore where 7,000 

vessels are involved and nearly 40,000 people. The President, in 

the early days, through conversations with Secretary Gates, Secretary Napolitano and I, ordered the authorization of the Coast 

Guard. So far the states have called up around 2,000 members of 

the Coast Guard to help in the fight. There are still another 18,000 

members that could be called up if the Governors themselves were 

to decide that that is what they want to do. 

Let me move over quickly to the subject of this legislation and 

the Bureau of Ocean Energy Management, Regulation and EnforceVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6602 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
6 

ment. Last year, in September, I believe, I testified in front of this 

Committee and Chairman Rahall. At the time, I indicated to you 

that you were a pioneer and this Committee was really pioneering 

an effort that was long in coming, and I said that because I recognized then as I recognize today that when you have an agency that 

has such a critical responsible set of missions, the collection on the 

average of $13 billion a year on behalf of the American taxpayer, 

and assuring that the oil and gas production, which is so important 

to this country, is conducted in a safe manner, that organic legislation is in fact necessary. 

So you were there, Mr. Chairman, and many members of this 

Committee long before this tragedy was there, and I remember testifying in support of you moving forward with that organic legislation. I think the events of the last 71 days have made it all the 

more clear that an agency of this importance needs to have that 

organic legislation. 

I won’t go over the fact I have gone over at other times but we 

have moved forward in the last 16 months with very strong efforts 

on ethics reforms, and hired former U.S. attorneys and independent prosecutors to essentially oversee this agency. There have 

been people who have been terminated, who no longer have jobs because of the ethics lapses of the past. That will now continue under 

Mike Bromwich, who has made major movement forward with respect to the Outer Continental Shelf and the plans that had been 

put out there prior to us coming on board as Secretary of the 

Interior. We have opened up a new chapter to renewable energy 

and are looking very much forward to working with all of you as 

we stand up offshore wind energy, especially in the Atlantic in the 

years ahead. 

And finally, in the last two budgets we have moved increasingly 

to have the kinds of resources that can start policing these efforts 

in the OCS. From 2000 to 2008, the budgets for MMS essentially 

were flat lined. The budgets of the President’s and the budget that 

this Congress approved over the last couple of years have helped 

us get to the point. 

But having said that, there are going to be significant additional 

resources that will be needed, Chairman Rahall and Ranking Member Hastings, and members of the Committee, if we are to do the 

job that you all expect the Department of the Interior to do relative 

to assuring safety in the OCS in the development of oil and gas, 

as well as ensuring that the environment is protected. 

With that, Mr. Chairman, what I would like to do is turn it over 

to Mike Bromwich, the Director of the Bureau of Ocean Energy for 

his comments. 

[The prepared statement of Secretary Salazar follows:] 

Statement of The Honorable Ken Salazar, Secretary, 

U.S. Department of the Interior 

Chairman Rahall, Ranking Member Hastings, and Members of the Committee, I 

want to thank you for holding this hearing today as we continue to address the 

issues and challenges associated with the continuing reform of the Department of 

the Interior’s offshore energy program. 

Before we begin, I want to introduce Michael R. Bromwich, the new Director of 

the Bureau of Ocean Energy Management, Regulation, and Enforcement. His impressive background includes time as the Inspector General of the U.S. Department 

of Justice, as an Assistant U.S. Attorney, and since 1999, as an attorney in private 

7 

practice. His extensive experience in government and the private sector in improving the way organizations work make him an ideal choice to lead the restructuring 

and reform of the Department’s offshore energy program. 

For the same reasons I chose Michael Bromwich for this position, I chose Wilma 

Lewis who oversees the Department’s energy bureaus as the Assistant Secretary for 

Land and Minerals Management. A former U.S. Attorney for the District of Columbia and Inspector General at the Department, Wilma has played a central leadership role in some of the most significant reforms during my tenure as Secretary. 

She has helped shape reforms ranging from our new approach to offshore oil and 

gas leasing and a new emphasis on renewable energy development on the Outer 

Continental Shelf, to ethics reform, to the enhancement of leasing programs and the 

development of renewable energy programs onshore, to support for our study of policies designed to ensure fair return to American taxpayers for the development of 

public oil and gas resources. I have also appointed her to chair the Safety Oversight 

Board in the aftermath of the Deepwater Horizon oil spill, and to help spearhead 

the reorganization of the Minerals Management Service (MMS) toward a new future. 

Offshore Energy Reforms Completed 

Although this unprecedented disaster, which resulted in the tragic loss of life and 

many injuries, is commanding our time and resources, it has also strengthened our 

resolve to continue reforming the Outer Continental Shelf (OCS) program. 

The reforms we have embarked on over the last 17 months, and upon which we 

will continue to build, are substantive and systematic, not cosmetic. The kind of fundamental changes we are making do not come easily and many of the changes we 

have already made have raised the ire of industry. Our efforts at reform have been 

characterized by some as impediments and roadblocks to the development of domestic oil and gas resources. We believe, however, that they are crucial to ensuring that 

we carry out our responsibilities effectively, without compromise, and in a manner 

that facilitates the balanced, responsible, and sustainable development of the resources entrusted to us. 

I want to review the reforms with you: 

First, we focused our efforts on ethics and other concerns that had been raised 

in the revenue collection side of the MMS. We began changing the way the bureau 

does business and took the following concrete actions: 

• upgraded and strengthened ethics standards throughout MMS and for all political and career employees; 

• terminated the Royalty-in-Kind program to reduce the likelihood of fraud or collusion with industry in connection with the collection of royalties; and 

• aggressively pursued continued implementation of the recommendations to improve the royalty collection program that came from the Department’s Inspector 

General, the Government Accountability Office, and a committee chaired by 

former Senators Bob Kerrey and Jake Garn. 

Second, we reformed the offshore oil and gas regulatory program, which included 

the following: 

• initiated in the Fall of 2009 an independent study by an arm of the National 

Academy of Engineering to examine how we could upgrade our inspection and 

safety program for offshore rigs; 

• procured substantial increases in the MMS budget for FY 2010 and FY 2011, 

including a ten percent increase in the number of inspectors for offshore facilities; and 

• developed a new approach to on-going oil and gas activities on the OCS aimed 

at promoting the responsible, environmentally sound, and scientifically grounded development of oil and gas resources on the Outer Continental Shelf. 

In that effort, we cancelled the upcoming Beaufort and Chukchi lease sales in the 

Arctic, removed Bristol Bay altogether from leasing both the current 5 year plan as 

well as the next 5 year plan, and removed the Pacific Coast and the Northeast entirely from any drilling under a new 5 year plan. We made clear that we will require 

full environmental analysis through an Environmental Impact Statement prior to 

any decision to lease in any additional areas, such as the mid and south Atlantic, 

and launched a scientific evaluation, led by the Director of the United States Geological Survey (USGS), to analyze issues associated with drilling in the Arctic. 

Third, we laid the groundwork for expanding the mission of MMS beyond conventional oil and gas development by devoting significant attention and infusing new 

resources into the renewable energy program, thereby providing for a more balanced 

energy portfolio that reflects the President’s priorities for clean energy. Toward that 

end, we: 

8 

• finalized long-stalled regulations that define a permitting process for off-shore 

wind—cutting through jurisdictional disputes with FERC in the process and ultimately approving the Cape Wind project; 

• announced the establishment of a regional renewable energy office, located in 

Virginia, which will coordinate and expedite, as appropriate, the development 

of wind, solar, and other renewable energy resources on the Atlantic Outer Continental Shelf; and 

• entered into an MOU with governors of East Coast states, which formally established an Atlantic Offshore Wind Energy Consortium to promote the efficient, 

orderly, and responsible development of wind resources on the Outer Continental Shelf through increased Federal-State cooperation. 

Offshore Energy Reforms and Related Activities Underway 

Since the Deepwater Horizon explosion and oil spill, the reforms and associated 

efforts have continued with urgency, with particular focus on lessons being learned 

from the circumstances surrounding the event. We are aggressively pursuing actions 

on multiple fronts, including: 

• inspecting all deepwater oil and gas drilling operations in the Gulf of Mexico 

and issuance of a safety notice to all rig operators; 

• implementing the 30-day safety report to the President, including issuing notices to lessees on new safety requirements, and developing new rules for safety 

and environmental protection; defending the suspension on new deepwater drilling, which is currently the subject of litigation; and 

• implementing new requirements that operators submit information regarding 

blowout scenarios in their exploration plans—reversing a long standing exemption that resulted from too much reliance on industry to self-regulate. 

Additional reforms will be influenced by several ongoing investigations and reviews, including the Deepwater Horizon Joint Investigation currently underway by 

the Bureau of Ocean Energy Management, Regulation and Enforcement, and the 

United States Coast Guard. In addition, at my request, a separate investigation is 

being undertaken by the National Academy of Engineering to conduct an independent, science-based analysis of the root causes of the oil spill. I also requested 

that the Inspector General’s Office undertake an investigation to determine whether 

there was a failure of MMS personnel to adequately enforce standards or inspect 

the Deepwater Horizon. 

Further, on April 30th I announced the formation of the Outer Continental Shelf 

Safety Oversight Board to identify, evaluate, and implement new safety requirements. The Board, which consists of Assistant Secretary for Land and Minerals 

Management Wilma A. Lewis, who serves as Chair, Assistant Secretary for Policy, 

Management and Budget Rhea Suh, and Acting Inspector General Mary Kendall, 

will develop recommendations designed to strengthen safety, and improve overall 

management, regulation, and oversight of operations on the Outer Continental 

Shelf. 

Finally, the President established the independent bipartisan National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling tasked with providing options on how we can prevent and mitigate the impact of any future spills 

that result from offshore drilling. The Commission will be focused on the environmental and safety precautions we must build into our regulatory framework in 

order to ensure an event like this never happens again, taking into account the 

other investigations concerning the causes of the spill. 

Supplemental Legislation 

The Administration will make sure that BP and other responsible parties are held 

accountable, that they will pay the costs of the government in responding to the 

spill, and compensation for loss or damages that arise from the spill. We will do everything in our power to make our affected communities whole. As a part of the response efforts, we expect to spend a total of $27 million through June 30, 2010 for 

Interior’s response activities. 

As part of our reforms, we are also building on the efforts we undertook in the 

last seventeen months to strengthen the OCS budget. As I already mentioned, the 

President’s 2011 budget includes a ten percent increase in the number of inspectors. 

Our restructuring of the OCS program will require additional resources to aggressively pursue the reforms I outlined earlier, to implement the 30-day report to the 

President, and to potentially address the results of ongoing investigations and the 

findings of the President’s Commission. We are currently hiring an additional 

twelve inspectors, six more than we proposed in the 2011 budget, and we are taking 

other actions that are outlined in the 30-day report to the President. Over the 

course of the next several years, our restructuring of a more robust OCS regulatory 

9 

and enforcement program will dictate the need for engineering, technical, and other 

specialized staff. 

The President’s supplemental request of May 12, 2010, includes $29 million that 

will fund the near term resources we need for these activities. As you know, it is 

critically needed to support our full and relentless reforms—to bolster inspections 

of offshore oil and gas platforms, draft enforcement and safety regulations, and 

carry out environmental and engineering studies. The President’s request included 

a proposal to extend the time allowed by statute for review and approval of oil and 

gas exploration plans from 30 to 90 days—this is also needed and I hope Congress 

will include it in the final version of the supplemental. 

Reorganization of the Minerals Management Service 

On June 15, I appointed Michael R. Bromwich as the Director, of the Bureau of 

Ocean Energy Management, Regulation and Enforcement. Michael will lead us 

through the reorganization—the foundation for the reforms we have underway. He 

will lead the changes in how the agency does business, implement the reforms that 

will raise the bar for safe and environmentally sound offshore oil and gas operations, and help our Nation transition to a clean energy future. 

Michael will join the team that has been working out the details of the reorganization. In a May 19 Secretarial Order, I tasked Rhea Suh, the Assistant Secretary 

for Policy, Management and Budget, Wilma Lewis, the Assistant Secretary for Land 

and Minerals Management, and Chris Henderson, one of my senior advisors, to develop a reorganization plan in consultation with others within the Administration 

and with Congress. The report will provide the plan to restructure the Bureau of 

Ocean Energy Management, Regulation and Enforcement in order to responsibly address sustained development of the Outer Continent Shelf’s conventional and renewable energy resources, including resource evaluation, planning, and other activities 

related to leasing; comprehensive oversight, safety, and environmental protection in 

all offshore energy activities; and royalty and revenue management including the 

collection and distribution of revenue, auditing and compliance, and asset management. 

The Deepwater Horizon tragedy and the massive spill have made the importance 

and urgency of a reorganization of this nature ever more clear, particularly the creation of a separate and independent safety and environmental enforcement entity. 

We will responsibly and thoughtfully move to establish independence and separation 

for this critical mission so that the American people know they have a strong and 

independent organization ensuring that energy companies comply with their safety 

and environmental protection obligations. 

The restructuring will also address any concerns about the incentives related to 

revenue collections. The OCS currently provides nearly 30 percent of the Nation’s 

domestic oil production and almost 11 percent of its domestic natural gas production 

and is one of the largest sources of non-tax and non-trust revenue for the Treasury. 

The MMS collected an average of more than $13 billion annually for the past 5 

years. There will be clear separation between the entities that collect and manage 

revenue and those that are responsible for the management of the OCS exploration 

and leasing activities. 

Sustained Response Efforts in the Gulf 

Of utmost importance to us is the oil spill containment and clean up of the Gulf. 

I have returned to the Gulf Region numerous times to help the Administration’s effort to protect the coasts, wetlands, and wildlife threatened by this spill. We have 

deployed approximately 1,000 employees to the Gulf and they are directing actions 

to contain the spill; cleaning up affected coastal and marine areas under our jurisdiction; and assisting Gulf Coast residents with information related to the claims 

process, health and safety information, volunteer opportunities, and general information on the efforts being carried out in the region. 

Under the direction of National Incident Commander Admiral Thad Allen and an 

effort co-led by me and Energy Secretary Steven Chu, we announced an improved 

estimate of how much oil is flowing from the leaking well. That estimate, suggests 

that the flow rate is at least 35,000 barrels per day, based on the improved quality 

and quantity of data that are now available. 

The Department’s senior staff continues to offer coordination and guidance to the 

effort. Deputy Secretary David J. Hayes is devoting his time to coordinating the 

many Gulf-related response activities we are undertaking. Assistant Secretary for 

Fish, Wildlife and Parks Tom Strickland has been leading the Department’s efforts 

for onshore and near shore protection. National Park Service Director Jon Jarvis 

and Acting Director of the Fish and Wildlife Service Rowan Gould continue to supervise incident management personnel and activities that their bureaus are taking to 

10 

respond to the spill and clean up oil impacts. The NPS and FWS have dispatched 

approximately 590 employees to protect the eight national parks and 36 wildlife refuges and the numerous wildlife, birds, and historic structures they are responsible 

for in the Gulf of Mexico. 

Representatives from the FWS also participated with the U.S. Coast Guard, the 

Environmental Protection Agency, National Oceanic and Atmospheric Administration and state and local governments in a series of public meetings with local residents to answer questions and offer information on a variety of topics related to the 

spill and response activities. 

Finally, there are many, many people in the Department who are devoting significant time and energy to this event; to the various investigations and inquiries, both 

within the Administration and in Congress, that are being carried out; and to the 

ongoing reorganization and reform. I want to acknowledge their work and let them 

know their efforts are appreciated and are not going unnoticed. 

Over the last couple of months, we have also seen what the employees in the Bureau of Ocean Energy Management, Regulation and Enforcement are capable of, 

their professionalism, their dedication to the Department, and their enthusiasm for 

the reforms underway. With Michael’s help we will be able to cast aside the shadow 

on the many dedicated employees that has been left by an errant few, and by previous policies that have prioritized production over ethics, safety, and environmental 

protection. 

H.R. 3534, the CLEAR Act 

Mr. Chairman, last week you unveiled a new version of your comprehensive energy legislation, H.R. 3534, ‘‘the Consolidated Land, Energy, and Aquatic Resources 

Act.’’ The Administration is carrying out a detailed review of this new version of 

your bill. While the primary focus of this legislation is the Department’s mineral 

leasing programs, there are provisions of this bill that affect agencies other than the 

Department. It is important that the expertise of other affected agencies inform this 

process where appropriate. We will coordinate with other agencies in the Administration as we move forward with an evaluation of these important issues. Similarly, 

we expect that the findings of the recently-established Presidential Commission, the 

National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, 

will also help inform decisions on what legislative changes are needed. However, I 

would like to offer some general comments on several provisions that specifically impact the Department. 

When I testified before this Committee on the introduced version of H.R. 3534 

last September, I indicated that the Department was in full agreement with the legislation’s goals of ensuring a balanced and responsible approach to energy development on our public lands and waters and that dependable oversight and sensible 

reform of mineral royalty programs must be achieved. I also indicated that, like you, 

I support reforms of the mineral leasing process and programs that will enable us 

to manage our onshore and offshore resources more effectively and responsibly. 

We have firmly supported the need for organic legislation for the functions performed by MMS. We agree that an organization with such important responsibilities 

should be governed by a thoughtfully considered organic act. It is important for organic legislation to provide the Secretary with the discretion to implement the details of a reorganization as complicated as this. The report and schedule for implementation that I will receive on July 9th will provide me with a detailed roadmap 

for this reorganization and will greatly inform the process. The Administration 

would like to provide the Committee with more detailed comments regarding the 

specifics in this legislation, including the appointment and confirmation of the new 

bureau and office heads. 

Significant time and effort have been spent by senior staff at the Department detailing and analyzing reorganization of the functions carried out by the MMS. Section 101 of H.R. 3534 would include in the Bureau of Energy Resource Management 

the onshore energy management functions currently carried out by the Bureau of 

Land Management under its multiple use land management mandate. We will work 

with your Committee to further examine these provisions. 

There are many other provisions in this bill of which we are generally supportive 

and would like to continue discussions with the Committee. For example, a number 

of changes in H.R. 3534 highlight the need for increased safety of operations and 

consideration of the marine and coastal environment, including the need for integrated programs for both environmental research and technological research and development. A focus on strengthened safety and oversight and the environmental impacts of offshore oil and gas operations are priorities of the Administration. We will 

work closely with other relevant agencies to ensure we develop a coordinated federal 

approach to address these objectives. 

11 

H.R. 3534 would extend the deadline for the Department to review and approve 

exploration plans; require that lessees obtain a drilling permit after approval of an 

exploration plan; and require that, prior to approval of such a permit, an engineering review of the well system be completed and reviewed. It also includes new planning requirements for detailed descriptions of equipment and plans to address potential well blowouts. The Administration supports authority to provide for longer 

review time of exploration plans to allow for stronger reviews of exploration plans 

prior to drilling. 

Recognizing the importance of this information, on June 18, 2010, the Department 

issued a Notice to Lessees (NTL) requiring that new filings for drilling permits, exploration plans, or development plans to contain information specifically addressing 

the possibility of a blowout and the detailed steps that lessees or operators would 

take to prevent blowouts. This reverses a 2003 policy and a 2008 NTL that exempted many offshore oil and gas operations in the Gulf from submitting certain information about such a scenario and is consistent with the requirements contained in 

these bills. 

We are also supportive of the changes in H.R. 3534 intended to strengthen civil 

and criminal penalties contained in the OCSLA. These provisions are generally consistent with the support for increasing these penalties that we have expressed in 

recent appearances before Congress. The Department is also supportive of adding 

language to the OCSLA authorizing the imposition of civil judicial penalties for violations of the Act. 

It is also important that the Department have the tools necessary to efficiently 

and effectively carry out the duties related to offshore energy development, including to appropriately staff critical and hard-to-fill positions in these new entities. We 

look forward to working with the Committee and other agencies on the provisions 

in H.R. 3534 that address this issue. Provisions addressing royalty-related reforms 

may also be an important component of this reorganization. While additional time 

is needed to analyze the inclusion of a number of significant provisions, we do support the repeal of the royalty relief provision contained in section 344 of the Energy 

Policy Act of 2005 as this repeal is consistent with the President’s fiscal year 2011 

budget request. 

The President’s June 12, 2009 memorandum creating an Ocean Policy Task Force 

envisions a comprehensive, national approach to ocean planning. The Department 

is currently involved in a multi-agency process to develop a new national ocean policy that is intended to look ahead in the long term to help the United States think 

comprehensively about how we make better informed management decisions regarding the use and conservation of ocean, coastal, and Great Lakes resources. The Department supports the approach of the President’s Task Force. 

Finally, the Administration appreciates your focus on ensuring comprehensive and 

long-term restoration of the Gulf of Mexico in the wake of this tragedy. As the President has made clear, a long-term plan is needed to restore this unique coastal region from the effects of this tragedy, just the latest blow to befall the people and 

environment of this special place. The Administration is already moving forward 

with this plan, and the President has asked Secretary of the Navy Ray Mabus to 

develop a long-term Gulf Coast Restoration Support Plan that will include input by 

states, local communities, tribes, fishermen, businesses, conservationists, and other 

Gulf residents. 

Conclusion 

Much of my time as Secretary of the Interior has been spent working to promote 

reform of prior practices in the MMS and to advance the President’s vision of a new 

energy future that will help us to move away from spending hundreds of billions 

of dollars each year on imported oil. A balanced program of safe and environmentally responsible offshore energy development is a necessary part of that future. 

Our efforts to develop a robust OCS renewable energy program are a major part 

of the effort to find that balance and help move our Nation toward a clean energy 

future. However, we also recognize that, for now, conventional oil and gas continues 

to play a significant role in our economy. As we evaluate new areas for potential 

oil and gas exploration and development on the OCS, we will conduct thorough environmental analysis and scientific study, gather public input and comment, and carefully examine the potential safety and spill risk considerations. 

The findings of the Joint Investigation and the independent National Academy of 

Engineering will provide us with the facts and help us understand what happened 

on the Deepwater Horizon. Those findings, the work of the Outer Continental Shelf 

Safety Oversight Board, the OIG investigation and review, and the findings of the 

Presidential Commission will help inform the implementation of the Administration’s comprehensive energy strategy for the OCS. 

12 

We are taking responsible action to address the safety of other offshore oil and 

gas operations, further tightening our oversight of industry’s practices through a 

package of reforms, and taking a careful look at the questions this disaster is raising. We will also work with you on legislative reforms and the finalization of a reorganization that will ensure that the OCS program is effectively managed to achieve 

these goals. 

Lastly, let me assure you this Administration will continue its relentless response 

to the Deepwater Horizon tragedy. Our team is committed to help the people and 

communities of the Gulf Coast region persevere through this disaster, to protect our 

important places and resources, and to take actions based on the valuable lessons 

learned that will help prevent similar spills in the future. 

Response to questions submitted for the record by the U.S. Department of 

the Interior on H.R. 3534, ‘‘CLEAR Act’’ 

Questions submitted by Rep. Kind 

1. Secretary Salazar, the bill requires that industry provide information to 

regulators on how long it would take to drill a relief well. I’m concerned 

this doesn’t go far enough. Right now, the only proven technology that 

government and industry know of to stop oil from spewing into the 

ocean is the drilling of a relief well. Wouldn’t it be advantageous to drill 

at least a partial relief well concurrently with the regular drill well? 

Response: We are continuing to actively determine the best strategies to ensure 

enhanced worker safety and health and environmental safety standards for offshore 

operations. We are undertaking aggressive and comprehensive reforms to offshore 

oil and gas regulation and oversight. This includes the reorganization of the former 

Minerals Management Service, as well as the implementation of tougher standards 

in the drilling and production stages, for equipment, safety practices, and environmental safeguards. The temporary suspensions of deepwater drilling, which were 

lifted on October 12, 2010, allowed the Department time for investigation and implementation of needed new safety, containment and oil spill response capability measures. Secretary Salazar based his decision to lift the deepwater drilling suspensions 

on information gathered in recent months, including a report from BOEMRE Director Michael Bromwich on October 1, that shows significant progress in reforms to 

drilling and workplace safety regulations and standards, increased availability of oil 

spill response resources since the Macondo well was contained on July 15 and killed 

on September 19, and improved blowout containment capabilities. 

The continued collection and analysis of key evidence regarding the potential 

causes of the Deepwater Horizon explosion will help inform our ongoing analysis. 

The Administration strongly supported House passage of the CLEAR Act, which 

would provide authority to strengthen environmental reviews of offshore drilling 

plans, reform revenue collection, and implement a more extensive system of inspections of offshore energy activities. 

Regarding the drilling of relief wells, it may seem reasonable to assume that relief 

wells reduce risk, and that we could save time responding to any blowout by requiring operators to drill a relief well alongside each well drilled in the Gulf of Mexico. 

However, the risk of a blowout in the relief well may be the same as the risk of 

a blowout in the initial well. This increased risk is a direct result of drilling twice 

as many wells into a formation. Each well drilled increases the risk of a blowout 

simply because each well presents its own unique geologic and engineering risks. 

Relief wells have historically been an effective method to stop the flow of oil from 

the bottom of a well blowout and begin the process of pumping cement to abandon 

the well. However, both the risk and costs of drilling relief wells dictate that they 

are typically only drilled when necessary to respond to a well blowout. As demonstrated with the Deepwater Horizon response, there are other deepwater well containment options that may be faster and equally effective way in reducing or stopping the flow of oil into the ocean. BOEMRE is in the process of establishing enforceable mechanisms to ensure the availability of blowout containment resources. 

And industry commitments have been made for new investments in designing and 

developing a multi-scenario, multi-component containment system. 

2. Secretary Salazar, there are a lot of layers of oversight in this bill, separate agencies and independent third party certification of equipment. 

While I support these reforms, will they even matter in the event of another blowout? Right now, if there is another blowout and subsequent 

leak, we will have to wait over three months for a relief well to stop the 

13 

flow of oil, correct? There isn’t any technology developed or being developed that can successfully stop the flow of oil? 

Response: The Bromwich report referenced above evidences the hard work carried out and progress made since the Deepwater Horizon disaster in April in addressing drilling safety, blowout containment, and spill response. 

New safety measures, including requirements relating to the functionality and 

testing of blowout preventers and the design, construction and cementing of wells, 

have been put in place. Significant developments and improvements have been 

made in deepwater well containment technology and equipment; the management 

and coordination of containment operations and logistics; and the drilling of relief 

wells. BOEMRE is in the process of establishing enforceable mechanisms to ensure 

the availability of blowout containment resources. And industry commitments have 

been made for new investments in designing and developing a multi-scenario, multicomponent containment system. 

The resources available for other response activity today, should another spill 

occur, have increased significantly from critical levels present shortly after the 

Deepwater Horizon incident. Most of the resources such as personnel, vessels, and 

containment boom used during the spill are no longer deployed therefore eliminating the urgent concern about the sufficiency of resources to respond to another 

potential oil spill. 

3. Secretary Salazar, what does the Department of Interior think would be 

the best approach to increasing research and develop technology that 

will prevent and stop an oil spill? 

Response: The Administration specifically supported the provisions in H.R. 3534 

to remove the arbitrary limit on liability for damages caused by offshore drilling because it will create incentives for the oil and gas industry to comply with new health 

and environmental safety standards and seek out and implement best practices to 

do so. 

Also in July the Department issued its implementation plan for restructuring the 

offshore energy management responsibilities under its jurisdiction. The plan calls 

for the creation of the Bureau of Safety and Environmental Enforcement, tasked 

with promoting and enforcing safety in offshore energy exploration and production 

operations and assuring that potential negative environmental and other impacts on 

marine ecosystems and coastal communities are appropriately considered and mitigated, and to continue research activities to support evolving regulatory needs as 

technologies advance. 

Questions submitted by Rep. Luja ́n 

1. Secretary Salazar, the draft legislation under discussion would require 

the use of ‘‘best available technology’’ for new Outer Continental Shelf 

drilling permits, with the Secretary of the Interior identifying what constitutes ‘‘best available technology’’ every 3 years. How do you foresee 

this identification of best available technology working and do you think 

it will spur or inhibit innovation in development of new technologies? 

Response: The details of such a process are typically finalized once specific language has been enacted into law. Nevertheless, under current offshore regulatory 

processes, the Department reviews an operator’s exploration or development plans 

and Applications for Permits to Drill to verify the use of best available and safest 

technology and inspections verify the use of approved equipment and maintenance 

of that equipment. Thus the Department has a parallel base of knowledge and experience and would expect to build on that knowledge base. However, the results of 

the several ongoing investigations of the event will inform the long-term responses. 

2. Secretary Salazar, the BLM currently collects rent payments from solar 

energy right-of-way authorizations. The agency also collects a ‘‘megawatt capacity fee’’ that is based on the total authorized megawatt capacity for the approved solar energy project. These megawatt capacity fees 

charge different fees for different solar technologies and have a rate 

structure that may actually penalize technologies that are more efficient 

and use less land. I understand that the Bureau is seeking to collect fair 

market value for renewable energy production on public land, however 

these megawatt capacity fees vary with different solar technologies and 

operate on a rate structure that may discourage renewable energy technology development. As you know, clean, renewable energy technologies 

provide taxpayers benefits beyond electricity generation, and I would 

like to know how the agency intends to ensure that renewable energy 

14 

revenue collection is based on a sound, fair methodology that promotes 

efficient generation of clean energy on public lands? 

Response: The BLM is required by the Federal Land Policy and Management Act 

to collect an annual rental payment for right-of-way authorizations on the public 

lands, and that statute requires that rents for these authorizations reflect the fair 

market value for the use of the public lands. The solar rental schedule, issued by 

the BLM in early June, was developed based on review and analysis by the Department, the BLM, and the U.S. Department of Energy of economic models comparing 

the effects various rental rates may have on different kinds of solar projects. It is 

explained in detail in the instructional memorandum found at: http://www.blm.gov/ 

wo/st/en/info/regulations/InstructionlMemoslandlBulletins/nationallinstruction/ 

2010/IMl2010–141.html. The new rental schedule provides certainty to solar operators and ensures a fair return to American taxpayers for the use of their public 

lands. 

Questions submitted by Rep. Tsongas 

1. Secretary Salazar, this week I am introducing legislation requiring oil 

companies to address a worst-case scenario oil spill, like the one that we 

are dealing with in the Gulf of Mexico, as a condition to being granted 

rights to explore or drill for oil off our coastline. It would build on the 

requirements in the CLEAR Act by requiring additional safeguards to 

protect our oceans and coastlines from another catastrophic spill. Having dealt with a worst-case scenario spill over the last few months and 

its tragic and ongoing consequences, what requirements and safeguards 

do you think are absolutely necessary to have in place to effectively respond to a future worst-case scenario spill? And how do we force regulators to imagine new scenarios that we possibly have not yet considered? 

Response: The Administration strongly supported House passage of H.R. 3534, 

which contains many provisions that would give the Department additional authorities to promote enhanced health and environmental safety standards for offshore operations, strengthen environmental reviews of offshore drilling plans, reform revenue collection, and implement a more extensive system of inspections of offshore 

energy activities. The results of the ongoing investigations into the root cause of the 

tragedy will provide us with key information to consider, but the October 1, 2010, 

report from BOEMRE Director Bromwich provides a comprehensive look at the 

progress made on important requirements and safeguards that the Department believes are necessary to address drilling safety, blowout containment, and spill response. 

These include new safety measures, including requirements relating to the 

functionality and testing of blowout preventers and the design, construction and cementing of wells that have been put in place since April 20. In addition, BOEMRE 

issued a Notice to Lessees with requirements for the calculation of worst-case discharges and submittal of information of measures undertaken to prevent a blowout, 

reduce the likelihood of a blowout, and conduct effective and early intervention in 

the event of a blowout. Significant developments and improvements have been made 

in deepwater well containment technology and equipment; the management and coordination of containment operations and logistics; and the drilling of relief wells. 

BOEMRE is in the process of establishing enforceable mechanisms to ensure the 

availability of blowout containment resources. And industry commitments have been 

made for new investments in designing and developing a multi-scenario, multi-component containment system. These measures are essential to protecting communities, coasts, and wildlife from the risks that deepwater drilling poses. 

2. Secretary Salazar, in a previous hearing before the Energy and Mineral 

Resources Subcommittee, Mr. Frank Rusco, Director of Natural Resources and Environment at GAO, stated that GAO found that there 

were system-wide and pervasive problems at the Interior Department in 

attracting and retaining expert employees for safety, equipment, and 

production inspections, and that it would be absolutely necessary to address this issue in any reorganization of the MMS. In your opinion, does 

the current draft legislation address this issue sufficiently, or do you 

have any suggestions for improving the ability for the Department of the 

Interior to attract and retain the experts necessary to oversee offshore 

oil and gas production? 

Response: Over the course of the next several years, the restructuring of the Department’s Outer Continental Shelf programs will dictate the need for engineering, 

15 

technical, and other specialized staff, particularly in the regulatory and enforcement 

program. This is an important issue and one the Department and Administration 

are already addressing. The President’s 2011 budget amendment, released on September 13, 2010, includes an additional $100 million for BOEM reform efforts, including funding for more inspectors. The amendment also proposes raising inspections fees from $10 million to $45 million to partially offset these added costs. We 

are in the process of hiring an additional 12 inspectors and are taking other actions 

that are outlined in the 30-day report to the President. Our restructuring of 

BOEMRE to achieve a more robust OCS regulatory and enforcement program will 

dictate the need for engineering, technical, and other specialized staff. The President’s enacted supplemental request includes $27 million to fund near term resources for these activities. The Administration strongly supported House passage 

of H.R. 3534, which contains provisions intended to advance this effort in the areas 

of hiring and training. The Administration looks forward to working with Congress 

to improve the bill as it proceeds through the legislative process. 

Questions for Director Bromwich 

Questions submitted by Rep. DeGette 

1. Director Bromwich, would the Department of the Interior support a requirement to disclose the chemicals used in hydraulic fracturing fluids 

in onshore oil and gas drilling on BLM land? 

Response: DOI believes transparency is important in order to effectively manage 

oil and gas drilling on Federal lands. The Department is currently evaluating ways 

to enhance transparency with respect to chemicals used for hydraulic fracturing. We 

are also identifying opportunities to collaborate with other agencies and key stakeholders to ensure safe natural gas development on Federal lands 

Questions submitted by Rep. Kind 

1. Director Bromwich, this bill proposes significant reforms to the regulatory agencies that oversee the oil and gas industry. Do you feel these 

reforms will actually be able to end the culture of coziness between industry and government regulators? 

Response: Setting expectations for agency transparency and accountability 

through clear legislative direction is an important step. In addition to the reforms 

presented in the bill, there are also departmental reforms underway. One such reform is the formation of an Investigations and Review Unit within the Bureau of 

Ocean Energy Management, Regulation and Enforcement (BOEMRE) which will 

look into allegations of misconduct against the companies we regulate as well as bureau personnel. In addition, we have recently developed a conflict of interest/recusal 

policy designed specifically to address claims that some regulatory and enforcement 

decisions were being made based on relationships rather than the facts. That policy 

was effective immediately when issued in August and applies to all offshore inspectors. 

These reforms, both proposed through legislation and the department, will take 

time to implement. However, I am extremely confident in the honest and dedicated 

employees within the BOEMRE, and implementing the reforms is a top bureau priority that will help restore the trust of the American public in our oversight of the 

oil and gas industry. 

2. Director Bromwich, do you support the creation of a National Oil and 

Gas Health and Safety Academy to provide initial and continued training for regulators? 

Response: BOEMRE is in the process of implementing significant reforms to its 

training programs which will allow for consistent initial and continued training in 

areas including health, safety, environmental compliance, and operations. The implementation of specific educational programs for regulators is contingent upon 

available funding. 

Questions submitted by Rep. Tsongas 

1. Director Bromwich, this week, I am introducing legislation requiring oil 

companies to address a worst-case scenario oil spill, like the one that we 

are dealing with in the Gulf of Mexico, as a condition to being granted 

rights to explore or drill for oil off our coastline. It would build on the 

requirements in the CLEAR Act by requiring additional safeguards to 

protect our oceans and coastlines from another catastrophic spill. Having dealt with a worst-case scenario spill over the last few months and 

16 

its tragic and ongoing consequences, what requirements and safeguards 

do you think are absolutely necessary to have in place to effectively respond to a future worst-case scenario spill? And how do we force regulators to imagine new scenarios that we possibly have not yet considered? 

Response: The Administration strongly supported House passage of H.R. 3534, 

which contains many provisions that would give the Department additional authorities to promote enhanced health and environmental safety standards for offshore operations, strengthen environmental reviews of offshore drilling plans, reform revenue collection, and implement a more extensive system of inspections of offshore 

energy activities. The results of the ongoing investigations into the root cause of the 

tragedy will provide us with key information to consider, but the October 1, 2010, 

report from BOEMRE Director Bromwich provides a comprehensive look at the 

progress made on important requirements and safeguards that the Department believes are necessary to address drilling safety, blowout containment, and spill response. 

These include new safety measures, including requirements relating to the 

functionality and testing of blowout preventers and the design, construction and cementing of wells that have been put in place since April 20. In addition, BOEMRE 

issued a Notice to Lessees with requirements for the calculation of worst-case discharges and submittal of information of measures undertaken to prevent a blowout, 

reduce the likelihood of a blowout, and conduct effective and early intervention in 

the event of a blowout. Significant developments and improvements have been made 

in deepwater well containment technology and equipment; the management and coordination of containment operations and logistics; and the drilling of relief wells. 

BOEMRE is in the process of establishing enforceable mechanisms to ensure the 

availability of blowout containment resources. And industry commitments have been 

made for new investments in designing and developing a multi-scenario, multi-component containment system. These measures are essential to protecting communities, coasts, and wildlife from the risks that deepwater drilling poses. 

2. Director Bromwich, in a previous hearing before the Energy and Mineral Resources Subcommittee, Mr. Frank Rusco, Director of Natural Resources and Environment at GAO, stated that GAO found that there 

were system-wide and pervasive problems at the Interior Department in 

attracting and retaining expert employees for safety, equipment, and 

production inspections, and that it would be absolutely necessary to address this issue in any reorganization of the MMS. In your opinion, does 

the current draft legislation address this issue sufficiently, or do you 

have any suggestions for improving the ability of the Department of the 

Interior to attract and retain the experts necessary to oversee offshore 

oil and gas production? 

Response: Over the course of the next several years, the restructuring of the Department’s Outer Continental Shelf programs will dictate the need for engineering, 

technical, and other specialized staff, particularly in the regulatory and enforcement 

program. This is an important issue and one the Department and Administration 

are already addressing. The President’s 2011 budget amendment, released on September 13, 2010, includes an additional $100 million for BOEM reform efforts, including funding for more inspectors. The amendment also proposes raising inspections fees from $10 million to $45 million to partially offset these added costs. We 

are in the process of hiring an additional 12 inspectors and are taking other actions 

that are outlined in the 30-day report to the President. Our restructuring of 

BOEMRE to achieve a more robust OCS regulatory and enforcement program will 

dictate the need for engineering, technical, and other specialized staff. The President’s enacted supplemental request includes $27 million to fund near term resources for these activities. The Administration strongly supported House passage 

of H.R. 3534, which contains provisions intended to advance this effort in the areas 

of hiring and training. The Administration looks forward to working with Congress 

to improve the bill as it proceeds through the legislative process. to oversee offshore 

oil and gas production? 

The CHAIRMAN. Mr. Director, our condolences—I mean congratulations to you on your new position, and we look forward to working with you. You come from impeccable background, which is quite 

impressive, and certainly you are the man for the job. 

17 

STATEMENT OF HON. MICHAEL R. BROMWICH, DIRECTOR, 

BUREAU OF OCEAN ENERGY MANAGEMENT, REGULATION, 

AND ENFORCEMENT, U.S. DEPARTMENT OF THE INTERIOR 

Mr. BROMWICH. Thank you, Mr. Chairman, Ranking Member 

Hastings, and other distinguished members of the Committee. 

There is a prepared statement that really goes mostly into my 

background that I gather is in the record and so I won’t talk about 

that. I will be very brief. I want to talk about three concrete things 

that have been done in the eight days that I have now been on the 

job as the head of the agency. 

The first is the renaming of the agency from the former MMS to 

the Bureau of Ocean Energy Management, Regulation, and Enforcement. That was a decision by the Secretary to demonstrate 

that there is going to be a change and renewed focus for the agency, and that the focus is going to be now on proper and forceful regulation and enforcement in a way that had not been the case over 

the prior years. So the name is symbolic, but it is also real and it 

reflects a commitment to a new purpose and a new attitude toward 

regulation and enforcement. 

The second is the creation of an internal unit within the Bureau, 

which we are calling the Investigations and Review Unit. It was 

something I proposed to the Secretary on my first day. It is something he approved on my second day, and it is something that now 

exists and we are looking to staff it as quickly as possible. 

The new unit, the IRU, will be staffed with experienced prosecutors, investigators, scientists, and other personnel that will allow 

us to undertake prompt and aggressive enforcement action both 

with respect to allegations of misconduct against people in my 

agency, but also with respect to companies and other participants 

in the industry that we regulation. I am determined to be aggressive. This unit will help me be aggressive, and I am determined to 

be prompt in bringing appropriate enforcement action. 

The third and final point is something that I want to announce 

this morning, which is that we are imposing a fine of $5.2 million 

on BP America for false, inaccurate, and misleading reports submitted over a long period of time on energy production on the 

Southern Ute tribal lands in southwestern Colorado. A lot of the 

work was done by Southern Ute tribal auditors who initially discovered the problems. The problems were brought to the attention 

of BP America. The problems were not fixed, and as a result we 

concluded that the reporting violations were not accidental, but in 

fact knowing and willful. 

This has been in the works for awhile. It is not something that 

I produced in eight days. I think it is a reflection of the hard and 

serious work that people in my agency have done over time, but it 

does reflect a seriousness of purpose and an intent to be aggressive 

in pursuing violations of companies’ obligations in their dealing 

with royalties and other aspects of the program sunder my bureau’s supervision. 

So with that, Mr. Chairman, that concludes my opening statement, and I am obviously happy to answer any questions that I can 

later on. 

[The prepared statement of Mr. Bromwich follows:] 

18 

Statement of The Honorable Michael R. Bromwich, Director, Bureau of 

Ocean Energy Management, Regulation, and Enforcement (BOE), U.S. 

Department of the Interior 

Thank you, Chairman Rahall, Ranking Member Hastings, and Members of the 

Committee for the opportunity to be here today with Secretary Salazar. I appreciate 

being included in this hearing and being part of the discussions about reorganization of the Outer Continental Shelf program. 

Overview 

My appointment as the new Director started one week ago Monday, and therefore 

I have had only a short amount of time to begin to understand the Bureau’s programs, operations, and challenges. I would like to take my time to introduce myself 

and give you an overview of my vision and goals. 

When the President and Secretary Salazar asked me to take this assignment, I 

was a partner in the firm of Fried Frank. I headed the firm’s Internal Investigations, Compliance and Monitoring practice group and concentrated on conducting internal investigations for private companies and other organizations; providing monitoring and oversight services in connection with public and private litigation and 

government enforcement actions; and representing institutions and individuals in 

white-collar criminal and regulatory matters. I also provided crisis management assistance and counseling. 

Even while in private practice I have had significant experience with turning 

around troubled government agencies. I served for six years as the Independent 

Monitor for the District of Columbia’s Metropolitan Police Department and had just 

begun performing the same role for the Virgin Islands Police Department, which involved overseeing sweeping reforms of those Departments’ use of force programs. I 

also conducted a comprehensive investigation of the Houston Police Department’s 

Crime Lab and provided HPD with extensive recommendations for reforming its 

Crime Lab, which had a long history of very serious problems. 

In the private sector, I have conducted many major internal investigations for 

companies, including in the energy industry; reviewed the compliance programs and 

policies of major companies in a variety of industries, conducted extensive field reviews of such programs and made recommendations for their improvement; and represented companies and individuals in state and federal enforcement proceedings 

and criminal investigations. 

From 1994 to 1999, I was the Inspector General for the Department of Justice. 

I conducted special investigations into allegations of misconduct, defective procedures and incompetence in the Federal Bureau of Investigation Laboratory; the 

FBI’s conduct and activities regarding the Aldrich Ames matter; the handling of 

classified information by the FBI and the Department of Justice in the campaign 

finance investigation; the alleged deception of a Congressional delegation by highranking officials of the Immigration and Naturalization Service; and the Justice Department’s role in the CIA crack cocaine controversy. 

From 1987 through 1989, I served as Associate Counsel in the Office of Independent Counsel for Iran-Contra. In January through May 1989, I was one of three 

courtroom lawyers for the government in the case of United States v. Oliver L. 

North. I supervised a team of prosecutors and law enforcement agents that investigated allegations of criminal misconduct against government officials and private 

citizens in connection with provision of aid to the Contras in Nicaragua and serving 

as overall coordinator of the Iran-Contra grand jury. 

From 1983 to 1987, I served as an Assistant U.S. Attorney in the U.S. Attorney’s 

Office for the Southern District of New York. During my tenure, I tried many 

lengthy and complex cases and argued many appellate matters before the Second 

Circuit. I served as Deputy Chief and Chief of the Office’s Narcotics Unit. 

From those experiences dealing with many organizations and institutions, I have 

accumulated substantial experience in seeing what works and what does not in organizations. I have had experience leading government agencies, as well as reviewing the leadership styles in many agencies. Based on that experience, I am confident 

that I can lead this organization and implement the changes that are necessary. 

Bureau of Ocean Energy Management, Regulation and Enforcement 

As I said, I began my service as the Director, Bureau of Ocean Energy Management, Regulation and Enforcement on June 21, 2010. So far, my understanding of 

the events surrounding the Deepwater Horizon catastrophe are primarily based on 

the news coverage, what I have read, and initial conversations with Department of 

the Interior personnel. Therefore, my knowledge of the Bureau, its employees and 

its programs is at a very early stage. 

19 

I look forward to becoming well-versed in the complex regulatory regime governing offshore oil and gas exploration and drilling and the nation’s emerging and 

promising offshore renewable programs. It already is apparent that the programs 

that this Bureau manages are technologically complex and involve a highly specialized workforce. As an agency, we will be thinking carefully about, and proceeding 

quickly with, reforming the way the Bureau does business and oversees energy exploration and development. 

My goal is to develop a set of recommendations for the Secretary and the President that will improve the way the organization works. I am committed to eliminating improper incentives and influences, creating a culture for the OCS program 

that is devoted to vigorous and effective regulation and enforcement, and establishing the Bureau as an agency that is focused on safety and environmental protections. To provide us with the capacity to meet these commitments, I announced yesterday the establishment of an investigations and review unit within the Bureau 

that can act quickly and will report directly to me. 

I understand that the Department has been conducting an extensive analysis of 

the organization, its programs, and best practices in other countries and other agencies. I will take advantage of the work that has already been done. We expect to 

release a plan in the coming weeks that will guide the reorganization. I look forward 

to talking with you and getting your input to educate this process. 

These are important issues for the President, the Congress and the Nation. Under 

Interior’s management, the Outer Continental Shelf currently provides 30 percent 

of the Nation’s domestic oil production and almost 11 percent of its domestic natural 

gas production. The Nation currently relies on the OCS program to continue to 

make available the energy resources that we and our economy need. I look forward 

to the challenges ahead, and to ensuring that we manage the development of the 

Nation’s energy resources, while at the same time enforcing the law and aggressively regulating oil and gas exploration and drilling to ensure that this activity is 

conducted in a manner that is safe for workers and the environment. Thank you. 

The CHAIRMAN. Thank you, Director Bromwich, for that announcement that you have just made this morning. I commend you 

and members of your agency that have so diligently been pursuing 

this issue for a number of years now. 

Mr. Secretary, I am well aware of your support for protecting our 

American landscapes and your support for the great American outdoors. In your opinion, would the full funding of the LWCF in this 

bill help you in those efforts? 

Secretary SALAZAR. Mr. Chairman, the answer is yes. President 

Obama has initiated a conversation with America called the ‘‘America’s Great Outdoor Effort’’. There have been listening sessions in 

places Montana, and Maryland. There will be some in Colorado and 

all over this country, and our view has been that it is time for 

America to move forward with a new conservation agenda that 

meets the needs and challenges of the twenty-first century. 

And as the Chairman is well aware, the Land and Water Conservation Fund, frankly, has not been funded since its creation in 

the 1960s, and so how we move forward with that is something 

that I think is important, and we look forward to working with you 

and the Members of Congress on that issue. 

The CHAIRMAN. Thank you. As you are no doubt aware, there 

have been many parallels between this disaster in the Gulf of Mexico and the disaster that struck in my congressional district just a 

couple of weeks before the Deepwater Horizon when we lost 29 

brave coal miners in a coal mine tragedy. 

There are those that say we should wait for the results of ongoing investigations before doing anything, before moving forward 

even though unsafe conditions are already well documented and 

continue to exist after the tragedies have occurred. 

20 

Do you believe that Congress should wait for the results of the 

ongoing investigations before trying to move forward on the type of 

legislation we are discussing today or is there a need to move forward now? 

Secretary SALAZAR. There is a need to move forward and to move 

forward with urgency, Chairman Rahall, and, frankly, the sooner 

that action is taken, the action that we are taking, the action that 

we are asking the Congress to help us with, the faster it is that 

we are going to be able to get beyond the tragedy and start standing up again the OCS effort in a way that can be done in a safe 

manner and protective of the environment. So, in my view, waiting 

is not an option. 

The CHAIRMAN. And let me ask you a further question about this 

pending legislation. When devising safety standards in legislation, 

do you think Congress should devise a more performance-based 

system or do we need to be more prescriptive? For instance, would 

it be a good idea for Congress to specify in law how many blindshear rams should be on a blowout preventer? 

Secretary SALAZAR. Let me say, Chairman Rahall, the organization which we created, I created through secretarial order that 

splits up the organization the way you described it earlier, was in 

fact an organization that we developed based on looking at Norway 

and looking at the United Kingdom as well. After tragedies they 

have had there with respect to OCS development, they came in and 

looked at how they were regulating the oil and gas development in 

the oceans, and so that was a manifestation of the organizational 

effort that we have created through secretarial order. 

The standards that are to be used are something that Mike 

Bromwich will be developing and in part it will be the implementation of the safety recommendations, which the President directed 

be delivered to him on May 28, and those recommendations have 

been delivered to him. 

On the question of what is mandatory versus what is performance-based, that is something that we will be working on in the 

days and weeks ahead. You know, I have a personal view on some 

of these issues but I have not yet had an opportunity to work with 

Mike on some of these issues, so maybe it would be a good idea for 

him to comment on that just briefly. 

The CHAIRMAN. OK, but you see where I am going. I don’t want 

to freeze in place today by prescriptive standards that forbids 

changes of the current technology is. We all know, whether it is 

open-heart surgery procedures or cancer surgery, you don’t want to 

freeze in place what we have today knowing advances that are still 

likely to be made in the future. 

Secretary SALAZAR. Let me respond. 

The CHAIRMAN. We don’t want to freeze in law. 

Secretary SALAZAR. No, I agree with you totally on that, Chairman Rahall, and I think one of the things that is going to happen 

as a result of the Deepwater Horizon, looking at all of the different 

issues that occurred here in many days before the explosion on 

April 20, is that there will be a lot to be learned, and in fact today 

what is happening in the subsea at 5,000 feet is nothing short of 

the Apollo 12 project and trying to bring that home. 

21 

And so technology that will be developed is something that is 

very important, so I do think that there ought to be the flexibility 

to the Bureau of Ocean Energy, Enforcement, and Regulation to 

the Department of the Interior is to make sure that we are able 

to develop those standards in a form that takes advantage of the 

lessons learned. 

The CHAIRMAN. Director Bromwich? 

Mr. BROMWICH. I agree with that. I think the risk of being too 

prescriptive is that the prescription will be quickly overtaken by 

new technology. So it may be appropriate to establish certain baselines that are prescriptive, but I think, as the Secretary has just 

said, it is critical to allow enough flexibility and discretion for the 

agency to respond appropriately to developments in technology over 

time. 

The CHAIRMAN. My time has expired. 

Mr. HASTINGS. Thank you, Thank you, Mr. Chairman. I am going 

to yield my time to Mr. Cassidy, but Mr. Secretary, before I do, on 

two other matters unrelated to this hearing, the PIL payment issue 

and the monument issue. I will be sending you a letter today and 

we would like to have a full and complete response to those questions, so I just wanted to give you a head’s up, that letter is going 

out today on an issue that we have had correspondence on in the 

past. 

But with this I want to yield to my colleague from Louisiana 

whose state obviously is impacted, so Mr. Cassidy. 

Mr. CASSIDY. Thank you, Mr. Hastings. 

Mr. Secretary, in the Department of the Interior brief that was 

filed in Judge Feldman’s court in New Orleans, DOI denies that 

there is irreparable economic harm because of this what we call 

back home jobs moratorium. Now, given that 20,000 jobs will be directly—20,000 will be laid off directly, and as many as 100,000 will 

be indirectly affected, those are fairly conservative estimates, is 

that not irreparable harm? 

Secretary SALAZAR. Congressman Cassidy, I appreciate the question and the economic issues at stake, and we recognize that there 

are economic consequences to the moratorium that we imposed. We 

believe that the moratorium was correct when we put it into place, 

and we believe it continues to be correct because the dynamic situation we see unfolding in the Gulf today—— 

Mr. CASSIDY. Just because I have limited time, is that not irreparable harm, 20,000 jobs lost directly, maybe 100 more indirectly, 

is that not irreparable harm? 

Secretary SALAZAR. I would say the greater irreparable harm 

would be if there was another blowout where there is not the oil 

response capability to even deal with the current Deepwater Horizon blowout, and the greater irreparable harm would be if you have 

a devastation of the Gulf Coast and its communities in a way that 

cannot be recovered, and so our program is—— 

Mr. CASSIDY. Thank you. 

Secretary SALAZAR.—comprehensive moving forward. 

Mr. CASSIDY. I just have limited time. I don’t mean to be rude, 

I am very sorry. 

So your collection of engineers from the National Academy of Engineering, they go through this, and they said that a blanket moraVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00025 Fmt 6633 Sfmt 6602 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
22 

torium is not the answer. It will not measurably reduce risk further, and it will have a lasting impact on the nation’s economy 

which may be greater than the oil spill. 

Now, here are eight experts gathered by the Department to make 

a decision, and they feel as if—the experts, science, not whatever— 

that this is not highlighted. I could go through more. ‘‘A blanket 

moratorium will have the indirect effect of harming thousands of 

workers and further impact state and local economies suffering 

from the spill. We would, in effect, be punishing a large swath of 

people who were and are acting responsibly, and are providing a 

product that the Nation demands. A blanket moratorium does not 

address the specific causes of this tragedy. We do not believe punishing the innocent is the right thing to do. We encourage the Secretary of the Interior to overcome emotion with logic, and to define 

what he means,’’ and they go on. 

Now, these were the experts, these were the scientists, so to 

speak, of petroleum engineering. What do you know differently 

than what they recommend? 

Secretary SALAZAR. First, Congressman Cassidy, their job was to 

help us with the safety report to the President, and they did, and 

I appreciate their help. I have met with the subsequent to that report, and will continue to get their input as well as the input from 

others on safety measures. 

Second, the question of the moratorium was a policy call, which 

I made, and there are two fundamental questions that need to be 

answered. One, do we have the oil spill response capability? Number two, can we ensure ourselves that we can move forward without the possibility of creating this kind of disaster again? How can 

we minimize that? 

Mr. CASSIDY. Now, I want to ask this because, again, in your report here you state that ‘‘Per the regulations, the advanced permit 

to drill requires technically detailed descriptions of well designed 

criteria, casing, cementing, and blowout protector systems.’’ This is 

page 6 of your brief. 

These fellows, they are all men so I will call them fellows, these 

fellows in their very first page say that, ‘‘We believe the blowout 

was caused by complex and highly improbable chain of human errors, coupled with several equipment failures and was preventable.’’ 

Now, they are not saying that this is something which is a black 

box which we peer into and cannot know an answer. Rather, they 

are saying that it is defined, and they produced this White Paper, 

which I am sure you are familiar with, which are safety recommendations that can be implemented now, and indeed per your 

brief filed with Judge Feldman you could look at those plans they 

have for drilling right now, and decide whether or not they meet 

the best practices outlined in this White Paper. 

Again, why not do that and preserve these 20,000 jobs? 

Secretary SALAZAR. OK. Let me answer the question in the 

broadest sense because I think members of the Committee and, Mr. 

Chairman, you and others have a great interest in where we are 

on the issue of the moratorium. 

We had three choices in front of us, OK. The first is simply move 

forward and pretend that nothing had happened, and that another 

23 

incident like this could never happen again, and there were some 

who were advocates of that, OK? 

We had another option, which some were advocates of, and that 

is that we bring to and end production in the oceans of America. 

OK, so that was a stop button. The President and I chose to move 

forward with a pause button because we believe that we have to 

learn some lessons to make sure that this does not happen again. 

Now, as we move forward we will adjust accordingly based on information that we develop, based on our ability to ensure safety 

and environmental protection, and so that is part of the process 

which we are undergoing at this point in time. 

Mr. CASSIDY. I yield back. You have been generous, Mr. Chairman. 

The CHAIRMAN. The gentleman’s time has expired. The Chair 

will recognize by the order in which they were here on the majority 

side, Mr. Heinrich from New Mexico. 

Mr. HEINRICH. Thank you, Mr. Chairman, and welcome, Mr. Secretary. I have a few questions, mostly regarding onshore reform. 

As you know, my home state, unfortunately, we are not blessed 

with the ocean-front property as some of my colleagues on this 

Committee, so I am going to focus largely on onshore. 

What is the Department doing to address some of the challenges 

that we have seen in the southern part of your home state and the 

northern part of my home state the split estates issues? Oftentimes 

where the minerals are Federally held the surface is privately held, 

and there are a number of inherent challenges and conflicts that 

tend to pop up between those surface owners and the folks who 

lease the minerals underneath those areas. 

Secretary SALAZAR. Congressman Heinrich, on your specific question on the split estates, I will have Director Bob Abbey get back 

to your office on what it is we are doing within BLM there. I will 

say this; that with respect to onshore issues and how they are addressed in this legislation, they are important issues for us, and we 

have moved forward on a reform effort that has included a number 

of different things, elimination of royalty-in-kind, which applies 

both to offshore as well as onshore, moving forward with the categorical exclusions issues within BLM and having the right kind of 

balance, in my view, in terms of how we protect the environment 

and conservation efforts, and at the same time allow development 

to occur. 

My own sense on this legislation, because it does deal with both 

BLM and with what was formerly MMS, is that we have a crisis 

right now in our hands relating to the Outer Continental Shelf, but 

there are some additional reform efforts related to onshore oil and 

gas development that I would be very happy to work with all of you 

and seeing how we might be able to make improvements there as 

well. 

Mr. HEINRICH. Thank you. You may have answered this when 

the Chairman started, but does the Administration have a position 

on full funding of the LWCF? 

Secretary SALAZAR. The Administration’s position on the Land 

and Water Conservation Fund is that they would like to see full 

funding of the Land and Water Conservation Fund. So if you look 

at the President’s budget for this year and moving forward in the 

24 

years ahead, it does achieve what was the full funding level at 

$900 million. 

I would say that this is the time for all of us to really re-examine 

what the commitment to conservation really is for the United 

States. I think when Stuart Udall, from your home state, Congressman Heinrich, and others sat down with Robert Kennedy and others, and thought about the concept of the Land and Water Conservation Fund their thoughts were that we took our American resources from our earth and that we should return something back 

to the earth with respect to some of the money needed for conservation. 

In my own personal view, and this is just my personal view, that 

is a promise unfulfilled because, in fact, billions of dollars that 

should have gone into the Land and Water Conservation Fund 

have not gone there because they have been diverted into other 

areas. 

Mr. HEINRICH. I appreciate that very much. I think it is an incredibly important part of this legislation. 

I know you issued a secretarial order last year regarding renewables. What is the status of the Department’s response to that 

order, and specifically, how are the fast-track projects moving 

along? 

Secretary SALAZAR. I am proud to say that that is one of the reform efforts which Director Abbey and my team have been working 

on very hard, and Assistant Secretary Wilma Lewis. We are looking still forward to getting a December 1 target date of permitting 

approximately 5,000 megawatts of power, mostly in solar and wind 

and geothermal. 

I have been in places like—very remote places in Utah, for example, where you have wind, solar, and geothermal projects combined 

that are actually up and running in Milford, Utah. So it is a very 

significant part of our new energy portfolio, and it is something 

that the President has prioritized. It is something we worked with 

you and the Congress to make it happen, and I do believe it is 

going to happen. 

Mr. HEINRICH. Thank you. I yield back, Mr. Chairman. 

The CHAIRMAN. The gentleman from Colorado, Mr. Lamborn. 

Mr. LAMBORN. Thank you, Mr. Chairman. 

Mr. Secretary, everyone here I believe and hope agrees that our 

priorities need to be to stop the leak, clean up the oil, address the 

needs of the Gulf states communities, and hold BP accountable. 

Now you have stated in the past that under your watch the Department will take very seriously the importance of science and 

peer-reviewed documents submitted by experts. 

According to recent press reports and releases from the Department after the recent offshore safety report was peer reviewed, it 

was then edited by political operatives at either the Department or 

the White House to assert against the recommendations of the expert report signers that a six-month OCS moratorium was appropriate. The experts then came out and denounced this manipulation. 

Two weeks ago before the Energy and Minerals Subcommittee I 

asked the acting Inspector General if she would open an investigation into how these changes were made, who made these changes, 

25 

and why those changes were misrepresented to the public as the 

work of the engineering professionals that the Department had 

contracted for the report. At the time she stated that while she 

wasn’t prepared to immediately declare that they would open an 

investigation, she could do so in the future. 

In order to ensure that she has the information she needs to 

make a comprehensive investigation, are you willing to cooperate 

with the Inspector General’s investigation into the political manipulations of this report? 

Secretary SALAZAR. Congressman Lamborn, first, there are no 

political manipulations. My letter to the President that I personally 

authored is very clear in its statement. It transmits the 30-day report to the President, and it separates my recommendation to the 

President, which is a policy matter relative to the moratorium. The 

fact is that the role of the engineers which I asked the National 

Academy of Sciences and the National Academy of Engineering, 

they were part of a peer-review process with respect to the safety 

issues, and I appreciate the work that they did very much. But at 

the end of the day the question of whether or not we move forward 

with drilling activity in the Outer Continental Shelf ultimately is 

the responsibility and duty under the law of the Secretary of the 

Interior. It is not the responsibility of the engineers or anyone else. 

And so that was my decision and I take full responsibility for that 

decision. 

Mr. LAMBORN. Do you think it is appropriate to apologize to the 

American people for the wrongful interpretation that was put on 

the report? 

Secretary SALAZAR. I don’t think there is an apology that is necessary, Congressman Lamborn. The fact of the matter is I think 

that what this crisis should tell you, you being a Member of Congress from my home state, Doug, is that we ought not to let partisan politics or ideology essentially guide the issue which we face 

in America here today. We are in the midst of a dynamic crisis. It 

is an epidemic crisis. 

Yes, like 9/11, yes, like other crises we have faced, but this continues. It is not just a one-day thing to hit us. We are in day 71. 

We are going to be in it for several more months, and this is the 

time for the United States to come together and say we have a 

problem and we are going to fix the problem, and I will tell you, 

Congressman Lamborn, as Secretary of the Interior, I am absolutely resolute and confident that the problem will be fixed, and 

that this Gulf oil spill will serve as a catalyst for safer and more 

environmentally protective production of oil and gas in the Outer 

Continental Shelf; that it will serve as a catalyst, sir, for moving 

forward with a Gulf Coast restoration plan of this landscape of national significance, and that this Gulf spill will also serve as a catalyst for a new conservation agenda, and to help us move into the 

new energy frontier. 

So, I think if we as a country use the Gulf oil spill, this crisis, 

to really deal with these monumental issues of our time this crisis 

will be looked back 20 years from now in a very positive way by 

the American people. 

Mr. LAMBORN. Mr. Secretary, I agree with you on what our goals 

and intentions are and need to be, and I agree that partisanship 

26 

should not be a part of that. I am troubled that the experts had 

to come out and denounce the statement that was made that they 

had called for a moratorium when they did no such thing. In fact, 

they said that it presents other competing safety problems by having just a blanket moratorium instead of a nuanced focus approach. 

I am just troubled that they had to come out and denounce that 

interpretation. 

Secretary SALAZAR. Yes, they have their points of view and I appreciate and respect their points of view, and I appreciate the 

points of view of Members of Congress and other groups who have 

communicated with us. I have met with the engineers, including 

other engineers who are involved in that report, and I have had additional conversations with them about their point of view on how 

we move forward safely. 

You know, many conversations have been held with people about 

whether or not there is a part of OCS oil and gas development that 

can be moved forward with appropriate demarcations. May Day demarcations with respect to shallow water production, and we are 

moving forward with that. There may be some other demarcations 

that are appropriate as well, but we are going to be thoughtful and 

we are going to do the right thing, and I am not going to be pushed 

into doing anything prematurely relative to additional development 

in the OCS. 

Mr. LAMBORN. Thank you. 

The CHAIRMAN. We have time for one more question before 

breaking for votes. The gentleman from Oklahoma, Mr. Boren is 

next, and I will leave it up to him to decide whether he would like 

to not yield his time but give way to the former Chairman of this 

Committee, Mr. Miller of California, to ask questions ahead of him. 

Mr. BOREN. Mr. Chairman, I was number 27 the last time that 

the Secretary was here, but out of deference to my senior colleague, 

Mr. Miller, I will yield all of my time to him. 

Mr. GALLEGLY. Mr. Chairman, parliamentary inquiry. 

The CHAIRMAN. The gentleman from the State of California. 

Mr. GALLEGLY. Mr. Chairman, was that a unanimous consent 

question? 

[Laughter.] 

Mr. MILLER. I thank the gentleman. Welcome, Mr. Secretary, and 

Director Bromwich to the Committee. 

My question really is at what point do—how do we decide who 

is going to get to play? Assuming that at some point there will be 

a resumption of oil drilling on the Outer Continental Shelf, that 

there are leases that have been let and they will be exploited. What 

is the criteria for companies to now drill upon the American Outer 

Continental Shelf? 

Obviously, I have a very serious, longstanding concern with British Petroleum. In my other committee, in the Education and Labor 

Committee, we have chronicled over many years, as has OSHA, 

dangerous, lethal behavior by them repeated time and again in 

their refineries, on the pipelines and elsewhere under their jurisdiction, and now we see many of the warnings that we received 

over the last decade by independent commissions, from former Secretary of State James Baker’s independent commission to the pipeline safety, to Booz Allen, talking about cost cutting, about danVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00030 Fmt 6633 Sfmt 6602 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
27 

gerous decisions that were ignored all the way to the boardroom 

time and again. 

I guess the question I have is I want to know are they going to 

be allowed to go back out onto what is a very dangerous place as 

we now see for the environment, a critical area to explore for oil, 

are they going to be allowed to go out there or into the Arctic? I 

am sure they have the technical capabilities to do it. That is not 

what I am concerned about. 

What I am concerned about is the ethics of this company and 

how they have performed in the past to measure their performance 

in the future. I think they should be debarred from participating 

in the Outer Continental Shelf for five or seven years. It will have 

little or no impact on the supply of fossil fuels to this country. This 

is one of the most competitive places, one of the prizes to drill in 

the world, and with possibly some of the greatest returns to them. 

But at some point the American people are entitled to a standard. 

They have killed their workers before. They have refused to comply. They have paid some of the largest fines in history. I see that 

you just assessed them an additional fine for false, inaccurate, and 

misleading reports, which I assume is they misled the American 

public what they owed them on those lands, and I just want to 

know how the Department is going to handle this or how you think 

the Congress should handle this. 

Sort of like a poker game, you have to have jacks or better to 

open. You ought to bring a safety record. You ought to bring a conscientious corporate policy to the Outer Continental Shelf at a minimum. The question is whether or not the continental shelf will be 

available or not in the future is a different decision, but which parties are going to get to play and what are the standards that are 

going to be imposed? 

Secretary SALAZAR. Congressman Miller, first let me say that the 

standards and enforcement are absolutely necessary for moving forward with OCS development, and that is something that I have 

asked Mike Bromwich to work on with me and with others, and obviously the 30-day report to the President on safety will be part of 

that. 

Second, the question of past performance of companies, it is 

something that I will work with Mike Bromwich to figure out what 

it is that makes the most sense here, and I would ask Mike perhaps to comment on that particular point, and how you take into 

account the past performance of companies relative to whatever bar 

you might want to put into place. So Director Bromwich. 

Mr. BROMWICH. Yes. There are new standards that have been 

created industrywide that have been issued in the last several 

weeks, one on safety and one on the environment. So they are already across the board new requirements and new enhancements. 

But you raise a very important question, and that is, with a 

record of bad performance, deadly performance, should you evaluate applications differently. It is something that I am eight days 

into the job that I don’t have a firm conclusion on yet, but certainly 

it should be considered a relevant factor. It is also going to be a 

relevant factor as to what kind of enforcement will be brought with 

respect to violations in the future. It is perfectly appropriate, in my 

28 

view, that if you have repeat offenders, if you have recidivists that 

should increase the enforcement penalties that are imposed. 

Mr. MILLER. Well, I appreciate you saying that, and I hope that 

you will continue that, and it is up to the Congress to make that 

clear. But in the coal mining industry, in Mr. Rahall’s district, we 

have—under MSHA we have patterns of violations, and we see 

companies with horrible records that have been able to evade the 

law and continue to put miners in dangerous and deadly situation. 

I say this about BP because when I look at how they run complex 

refineries, and the lives that they have put in jeopardy, and the 

lives that have been taken, this is a complex workplace, and I am 

a little concerned that on the questions of process management 

standards that you are now starting to put into effect, or you have 

out for comment, that those were created by the American Petroleum Institute and no discussion with OSHA has taken place prior 

to very recently about those standards, and OSHA has 40 years of 

experience working with these industries on those issues, and I 

would hope that those would not go to final until there is an opportunity to walk this across that experience on how those processes, 

they may be the most important indicator of preventing serious explosive events taking place in the chemical and oil industry. 

Mr. BROMWICH. Mr. Miller, on that point, in connection with the 

joint investigation that is being conducted by my agency and by the 

Coast Guard, the expertise of OSHA is specifically being sought, so 

we are aware of the relevance of their work to the work that we 

are doing now, and I think that that—I don’t know whether that 

is a new recognition or not, but it is a recognition that we now 

have and plan to pursue in the future. 

Mr. MILLER. Well, Mr. Rahall and I both sent you a letter asking 

you to hold for a moment before those regulations that were developed by the Petroleum Institute, which may have very many good 

suggestions, but that should not be the sole determinant of what 

is going forward. 

Thank you. I yield my time back to Mr. Boren. 

The CHAIRMAN. No, Mr. Boren still has his—— 

[Laughter.] 

The CHAIRMAN. Mr. Boren still has his full time when we come 

back after this series of votes on the Floor. 

The Committee is in recess until the votes are over. 

[Recess.] 

The CHAIRMAN. The Committee on Natural Resources will resume its sitting, and on the Minority side the next gentleman in 

order of recognition is Mr. Wittman. 

Mr. WITTMAN. Thank you, Mr. Chairman. I appreciate the opportunity. Secretary Salazar, thank you so much for your efforts. 

I did want to talk a little bit about the current process of lease 

sales. I know that we have halted, or your office has halted, Virginia’s proposed OCS lease, which is going to further delay, I think, 

some efforts there as far as looking at comprehensive energy, and 

I appreciate the pause. I know we have to stop and figure out what 

went wrong in the Gulf and make sure that we are putting those 

practices in place as far as future efforts for offshore energy development. 

29 

I do believe strongly, though, that we need an all-of-the-above 

energy policy. We need to make sure we are developing all of our 

sources of energy, making sure that the marketplace allows those 

to be lifted up as to which ones are the most efficient, and I support oil and gas development as part of that whole mix. I also support wind development. 

I know the Administration had high hopes of developing offshore 

wind projects, and I appreciate your efforts to coordinate the MidAtlantic states and study the issue. However, 17 months into this 

Administration, MMS has only signed one commercial wind lease, 

held no lease sales and there don’t seem to be any schedule, and 

on top of that the permitting process looks like it will take years. 

I know as we have talked to folks it is an extended process with 

a variety of EIS’s involved, and I know the agency has said, well, 

we are going to take that time because we are not exactly sure how 

to go about this, we haven’t done these before. So I am concerned 

that it is going to take a significant period of time before any turbines can be built, and Virginia, as you know, has significant wind 

resources, has significant interests there. We have a number of 

consortiums that are very interested in offshore wind development. 

My question is this, if the Administration is going to slow oil and 

gas development, what can we expect to see with offshore wind? 

Are we also going to go through the same slow methodical process 

with that, especially when we are looking at making sure we stand 

up all these energy sources? 

Secretary SALAZAR. Thank you, Congressman, and thank you to 

you for your service on the Migratory Bird Commission and your 

great work there with Congressman Dingell on the conservation 

agenda for the country. 

With respect to the question on the offshore wind in the Atlantic, 

let me just say that we are moving forward as quickly as we possibly can, and I do have a SWAT team that I have assembled within Interior to take a look at how we can expedite the effort. We 

have been working with all the states and opened up an office now 

in your State, in Virginia, which will be the Atlantic Wind Renewable Energy Office, and so this is a high priority, and we will make 

sure that on this one we will not fall behind the rest of the world 

in developing offshore wind. 

Mr. WITTMAN. I think that is critical with our energy portfolio. 

Let me ask a little bit more, too, about the offshore oil and gas development. I know right now lease 220 site, the lease process there 

has been canceled. I am hopeful that as we learn the processes and 

the problems that have occurred in the development in the Gulf 

that we apply those, especially there in Virginia, because I know 

there is interest in making sure that that lease process goes forward. 

Can you give us some idea about where you see the future for 

the oil and gas lease off of Virginia as far as timewise? I know, as 

I said, right now it is canceled. Do you see that process being 

picked back up after we go through the analysis and learning process here in the Gulf? 

Secretary SALAZAR. Congressman, first, let me say that President 

Obama and I have been clear that we see an energy portfolio that, 

yes, very much pushes the new energy frontier for America, but at 

30 

the same time we recognize that oil and gas is a part of our energy 

portfolio to date. And so we will see efforts to continue to develop 

oil and gas in the Outer Continental Shelf, and we will learn the 

lessons from the Deepwater Horizon to make sure that as it is developed it can be done in a safe way and a way that protects the 

environment. 

With respect to Virginia, I would say this. Lease Sale 220 itself 

still had to undergo additional analysis, including additional environmental analysis, and there are important conflicts that you, 

Congressman Wittman, and the Governor and others need to be 

aware of relative to the Department of Defense and issues relating 

to that, that would also come out in that process. So we look forward to working with you, and the congressional delegation of Virginia and others as we move forward. 

Mr. WITTMAN. Very good, and one last question. In your testimony you said that we were going to do everything in our power 

to make our effective communities whole. As you know, in the Gulf, 

obviously, the seafood industry has been affected as well as the offshore oil and gas industry. As you know, that effect transcends the 

borders of the Gulf states. It also affects places like Virginia, Virginia seafood processors. 

Sixty-five percent of the oysters processed in Virginia come from 

the Gulf, so that effect extends beyond the Gulf states’ boundaries, 

and I just wanted to make sure that you are doing everything 

through your agencies to make sure that we are focusing on just 

not making folks whole in the communities in the Gulf, but also 

how it affects seafood communities in states like Virginia, and I 

know other East Coast states are also closely tied to the Gulf seafood industry, so I just wanted to make sure you were aware of 

that, and that we have assurances that those things are going to 

be kept in mind as far as making sure that we are making our affected communities whole. 

Secretary SALAZAR. Thank you, Congressman Wittman. The President and our team put together essentially a $20 billion escrow account, which is a place where claims can be filed through 

an independent administrator. There is an effort underway to 

make sure that legitimate claims are being paid, and so it will all 

be part of that process where claims that are legitimate claims will 

be considered. 

The CHAIRMAN. The Chair recognizes the gentleman from Oklahoma, and promises him the Chair will not take out of his time the 

minute and 43 seconds that Chairman Miller went overtime. 

Mr. BOREN. Thank you, Mr. Chairman. Thank you so much for 

holding this hearing and for allowing me to ask a question. I also 

want to thank our panelists for being here today, and also just 

want to say a special thank you. I know that you are all living with 

this spill every day. I can’t imagine the amount of stress you are 

under; you know, all the hours that you are putting into this. You 

know, we may disagree sometimes on different points of policy, but 

I know that your heart is in the right place and you are working 

really hard to try and get this thing cleaned up as soon as possible 

and to get this leak stopped. So I do want to say thank you. 

To the Secretary, I also want to say thank you. Sometimes we 

disagreed on energy policy at different points along the way, but 

31 

in Indian country I think we have worked really well together, particularly helping out my district in Oklahoma. I think you all are 

doing a tremendous job on the MMS reports, to the ethics reforms, 

some of the things that you all are doing. 

Some of the concerns I have, particularly in relation to the offshore, we do have some Oklahoma companies that have investments in the offshore. You know, they are not BP, they are not 

Exxon. I mean, these are smaller companies that have some investments, and the moratorium is affecting them. 

As an example, Samson, which is based in Tulsa, Oklahoma, because of the moratorium it is costing them hundreds of thousands 

of dollars a day, and I have visited with some of the executives. 

Some of them feel actually that it is unsafe to have these rigs and 

everything out there without a clear program and just kind of sitting out there for six months. 

So as you make your determination, as you take some of these 

recommendations like Mr. Cassidy pointed out, I hope you will also 

take into account the loss of jobs that is going on. 

Now to the onshore I have some information from IPAMS. This 

is interesting. They sent us this paper. It says, ‘‘A natural gas and 

oil lease is a definite maybe. Maybe the lease will be issued within 

a reasonable time period after the sale. Maybe you will get through 

all the environmental analyses and regulatory hurtles. Maybe you 

will get permission to drill. Maybe your project won’t be held up 

by legal challenges from obstructionist groups, and maybe you will 

find oil and gas, but definitely you will have to pay potentially millions of dollars. The natural gas and oil industry pays billions of 

dollars into the U.S. Treasury to obtain leases, $10 billion in 2008. 

Each lease is an at-risk investment with no guarantee that energy 

resources will be found or that it will return any revenue to the 

leaseholders.’’ 

BLM right now is currently holding about $100 million worth of 

unissued and suspended leases in Utah, Wyoming and Montana, 

and Colorado. That is $100 million of the company’s capital that is 

being held by the Federal Government in a nonproductive capacity. 

And the draft language of the bill, of the CLEAR Act, as an example, and I would like you to touch on this, there is a provision that 

eliminates non-competitive leasing, and so let us say you have a 

lease and only one company bids on the project, and you know, this 

is in an area where you are not having lots of companies bid on 

it because the geology is not proved up, because there may not— 

this may be what is called a rank wildcat in oil country, but some 

company decides, hey, we are going to put it on the line. We are 

going to drill up this lease and pay for it, and here are some of the 

wildcat developments that have happened recently: The Pinedale 

Andy Cline in Wyoming; the Bock & Shale Play in North Dakota, 

and Marcellus Shale in Appalachia. These are huge finds that 

would not have happened without some of this, you know, wildcat 

mentality, and I think under the draft of 3534 I am worried about 

this non-competitive lease piece. 

So as my time expires anything that you can touch on on the— 

you know, hopefully in the six months on the offshore maybe something can be worked out in that timeframe to start it back up, and 

the second, the onshore, like the non-competitive leasing and makVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00035 Fmt 6633 Sfmt 6602 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
32 

ing it harder for these companies to prove up their assets, I would 

like your thoughts on that. 

Again, thank you for your efforts, and I do appreciate John being 

in my class. He gets gold stars for being your brother. 

Secretary SALAZAR. Thank you very much, Congressman Boren. 

I appreciate the comments on the other work that we do because 

this Department is a huge department, and we continue to work 

hard on the issues relating to First Americans, including in your 

state Cobell and so many other issues that are very important to 

the Department and your country, and so I am proud of the team 

that we that we can use to work on that broad agenda. 

With respect to the two questions that you ended your comments 

with, let me take the six-month moratorium first. We are working 

on that to see whether there are some adjustments and some additional demarcations that might be able to be made. We will have 

more on that in the days ahead, and we are cognizant of all the 

important factors here, including protection of workers, and the 

safety issues, protection of the environment, as well as the economic issues relating to the moratorium, so there are all very much 

on our minds. 

Third, with respect to the issue concerning the CLEAR Act, and 

the elimination of non-competitive leases, let me say there has 

been significant reforms that we have undertaken within the Bureau of Land Management, and in fact part of the reason that 

those reforms are necessary are to be responsive to that IPAMS 

sense that you always get a definite maybe. Frankly, in the last administration, leases were handed out like pieces of paper without 

doing the kind of proactive planning that is necessary. 

Director Bob Abbey and I have taken a different approach, and 

that is that when leases are issued we want to have for certainty 

that those leases are in fact going to be developed. Now if you get 

a lease, more than likely it is going to be subject to a protest because of the way that the system has been set up over time. We 

are changing those things and it may be appropriately, Congressman Boren, at anytime for you to come and have a conversation 

with Director Abbey and what we are doing in terms of those reforms at the BLM. 

And perhaps, Mr. Chairman, at some point, I know you have a 

very busy schedule here, but we would welcome the opportunity to 

provide information the BLM and what it is doing on the onshore 

relative to this particular issue and others. 

The CHAIRMAN. Yes. Most definitely, Mr. Secretary. Thank you. 

Mr. BOREN. Thank you, Mr. Chairman. 

The CHAIRMAN. The gentleman’s time has expired. The Chair 

will advise all Members that the Secretary does have to leave at 

12:10. Dr. Bromwich will remain with us but, as always the practice, Members can submit questions for the record, and I am sure 

the Secretary or Direct Bromwich will get back to the respective 

Members. 

Secretary SALAZAR. Thank you, Mr. Chairman. 

The CHAIRMAN. The Chair recognizes the gentleman from Georgia, Dr. Broun. 

Dr. BROUN. Thank you, Mr. Chairman, Mr. Secretary. 

33 

I want to go back to a question very briefly that Mr. Lamborn 

was giving you, and I don’t think we got an answer. Just yes or 

no, will you cooperate with IG on this investigation about the disparity between your report and what the engineers said in theirs? 

Secretary SALAZAR. Congressman Broun, we have nothing to hide 

and I am willing to cooperate with anybody. I am not aware of—— 

Dr. BROUN. Is that a yes? 

Secretary SALAZAR. The answer is yes, we will—cooperate with 

anybody. 

Dr. BROUN. Thank you so much. I appreciate it. 

Secretary SALAZAR.—cooperate with anybody. 

Dr. BROUN. Just in the sake of time I apologize for cutting you 

off. 

I couldn’t agree more with President Clinton’s assessment last 

week that our priorities must be to fix the leak, keep the oil away 

from the shore, minimize the damage of the oil that reaches the 

shore, and find out who did what wrong and hold them accountable. But we do need to do the first three first, and let us never 

forget that the victims who must be made whole from this tragedy, 

and we cannot legislate, in my opinion, until we accomplish these 

priorities and discover what went wrong in the first place. 

Now is one time when this Administration might want to put 

politics aside and let a serious crisis actually go to waste. 

I would like to bring to the attention of this Committee two letters that I sent to the Administration last week, Mr. Chairman, in 

my capacity as Ranking Member of the House Committee on 

Science and Technology, Subcommittee on Investigations and Oversight, outlining a troubling pattern of politically motivated actions 

from this Administration in dealing with the Gulf oil spill and demanding scientific integrity moving forward. Mr. Chairman, I 

would like to as unanimous consent that the two letters I have sent 

to the President and to Secretary Salazar be entered into the 

record. 

The CHAIRMAN. Without objection, so ordered. 

[The letter to The President submitted for the record by The 

Honorable Paul C. Broun, M.D., Ranking Member, Subcommittee 

on Investigations and Oversight, follows:] 

U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON SCIENCE AND TECHNOLOGY 

SUITE 2321 RAYBURN HOUSE OFFICE BUILDING 

WASHINGTON. DC 20515–6301 

(202) 225–6375 

http://science.house.gov 

June 24, 2010 

The President 

The White House 

Washington, D.C. 20500 

Dear Mr. President: 

The national tragedy unfolding in the Gulf of Mexico is impacting the lives of millions in the Gulf Region and has attracted the attention of the entire nation. In the 

months following the Deepwater Horizon accident, BP, as well as federal, state, and 

local authorities, have sought to halt the flow of the ruptured wellhead, contain 

leaking oil and natural gas, prevent oil from reaching nearby shores and wetlands, 

and mitigate the effects of the spill on the Gulfs ecosystem. These are clearly 

34 

1White House Press Release, Subject: President Obama Announces Members of the BP 

Deepwater Horizon Oil Spill and Offshore Drilling Commission, June 14, 2010. 2 ‘‘Investigation of the Challenger Accident’’, Hearing before the Committee on Science and 

Technology, House of Representatives, June 10, 1986 ‘‘Space Shuttle Columbia’’, Joint Hearing 

before the Committee on Science and Technology, U.S. House of Representatives, and Committee on Commerce, Science and Transportation, U.S. Senate, February 12, 2003. 3 John Broder, ‘‘Panel Unlikely to End Deepwater Drilling Ban Early,’’ New York Times, 

June 21, 2010. 4Seth Borenstein, ‘‘Obama Spill Panel Big on Policy, Not Engineering,’’ Associated Press, 

June 20, 2010. 

daunting tasks. Despite the complexity involved, it is the responsibility of BP, along 

with federal, state, and local governments to meet these challenges. In order to surmount this hurdle, all parties need to know they are receiving the best scientific 

and technical advice possible—guidance free from political meddling or special interest motivations. Because I feel so strongly that the investigation, amelioration, and 

remediation of the Deepwater Horizon incident should be guided by unfettered scientific and technical advice, I am deeply concerned with a number of instances that 

have come to light in the wake of this accident. 

The Science and Technology Committee is no stranger to Commissions tasked 

with investigating complex technical incidents. That is why I was confused when 

your Administration announced the membership of the National Commission on the 

BP Deepwater Horizon Oil Spill and Offshore Drilling. 1 Previous Commissions established to investigate accidents such as the Challenger and Columbia Shuttle accidents all benefited from vast and broad technical expertise. 2 Unfortunately, I believe the Commission, and ultimately the American people, would benefit from representation by more technical and scientific members who have not already come 

to conclusions before being presented with all the facts. 3 Press reports have already 

cited comments from Commission members detailing their conclusions and hinting 

at what their findings and conclusions will be—before ever being presented with details and facts relating to the incident. 4

The conclusions, findings, and recommendations presented by previous commissions were readily accepted and routinely implemented because Congress and the 

American people trusted that the work conducted by those Commissions was unbiased. I fear that as currently constructed, the Commission will serve little purpose 

other than rubberstamping your Administration’s predetermined policy goals without fully investigating the root causes of the incident. Based on the composition of 

the Commission/it appears that the real task they are being asked to undertake is 

to justify the offshore drilling moratorium. 

Therefore, I recommend that, to ensure its complete independence, the Commission should report directly to you and to the Congress. Additionally, 1 would suggest 

that the membership of the Commission be expanded to include more scientific and 

technical members in a manner similar to that of the Challenger and Columbia 

Commissions, and that you solicit suggestions for new members from key Members 

of Congress. 

I look forward to working with you to ensure that the American public will view 

the work of the Commission as wholly independent and unbiased. 

Sincerely, 

REP. PAUL BROUN, M.D. 

Ranking Member 

Subcommittee on Investigations And Oversight 

cc: REP. BRAD MILLER 

Chairman 

Subcommittee on Investigations & Oversight 

[The letter to Secretary of the Interior Ken Salazar submitted for 

the record by The Honorable Paul C. Broun, M.D., Ranking Member, Subcommittee on Investigations and Oversight, follows:] 

35 

U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON SCIENCE AND TECHNOLOGY 

SUITE 2321 RAYBURN HOUSE OFFICE BUILDING 

WASHINGTON. DC 20515–6301 

(202) 225–6375 

http://science.house.gov 

June 24, 2010 

The Honorable Kenneth Salazar 

Secretary 

Department of the Interior 

1849 C Street NW 

Washington, DC 20240 

Dear Secretary Salazar: 

The national tragedy unfolding in the Gulf of Mexico is impacting the lives of millions in the Gulf Region and has attracted the attention of the entire nation. In the 

months following the Deepwater Horizon accident, BP, as well as federal, state, and 

local authorities, have sought to halt the flow of the ruptured wellhead, contain 

leaking oil and natural gas, prevent oil from reaching nearby shores and wetlands, 

and mitigate the effects of the spill on the Gulf’s ecosystem. These are clearly 

daunting tasks. Despite the ’ complexity involved, it is the responsibility of BP, 

along with federal, state, and local governments to meet these challenges. In order 

to surmount this hurdle, all parties need to know they are receiving the best scientific and technical advice possible—guidance free from political meddling or special interest motivations. Because I feel so strongly that the investigation, amelioration, and remediation of the Deepwater Horizon incident should be guided by unfettered scientific and technical advice, I am deeply concerned with a number of instances that have come to light in the wake of this accident. 

On May 27,2010, you issued a report titled ‘‘Increased Safety Measures for Energy 

Development on the Outer Continental Shelf.’’ The report stated that, ‘‘The recommendations contained in this report have been peer-reviewed by seven experts 

identified by the National Academy of Engineering.’’ The Academy selected these individuals because of their extensive petroleum industry expertise and independent 

perspective. Unfortunately, the expert opinions of those individuals appear to have 

been manipulated to advance the Administration’s policy goal of preventing domestic oil production. In a letter to Governor Jindal, and Senators Landrieu and Vitter, 

six of the eight peer-reviewers chastised the Administration’s manipulation of their 

expert advice. 

! In their letter they stated: 

‘‘the scope of the moratorium on drilling which is in the executive summary 

differs in important ways from the recommendation in the draft which we 

reviewed. We believe the report does not justify the moratorium as written 

and that the moratorium as changed will not contribute measurably to increased safety and will have immediate and long term economic effects. Indeed an argument can be made that the changes made in the wording are 

counterproductive to long term safety. 

The Secretary should be free to recommend whatever he thinks is correct, but 

he should not be free to use our names to justify his political decisions.1

On March 9, 2009 the President issued an executive memorandum on scientific 

integrity tasking the Director of the Office of Science and Technology Policy (OSTP) 

to develop recommendations within 120 days to guarantee scientific integrity 

throughout the executive branch.2 I’ve sought updates on the status of these recommendations for almost a year now.3 They are still outstanding. Despite this 

delay, his memorandum did lay out the following principle: 

‘‘Political officials should not suppress or alter scientific or technological 

findings and conclusions... 

(c) When scientific or technological information is considered in policy decisions, the information should be subject to well-established scientific processes, including peer review where appropriate, and each agency should appropriately and accurately reflect that information in complying with and 

applying relevant statutory standards;’’4

In March of 2006, the previous Administration issued guidance to agencies to 

encourage 

36 

‘‘the free exchange of ideas, data and information as part of scientific and 

technical inquiry. Scientific and technical information from or about Agency 

programs and projects will be accurate and unfiltered.’’ (emphasis added)5

In August of 2007, the previous Administration issued a memorandum to agencies 

that said, 

‘‘[a]gencies are expected to conduct programs in accordance with the highest 

standards of ethical and scientific integrity.’’6

We expect our government to provide both Congress and the public the full results 

of their work without the filter that those with opposing views might like to impose. 

Otherwise, we cannot have a full and free scientific debate. While the Department 

of Interior report may not have directly altered the scientific and technical advice 

of those peer-reviewers, by implying that they agreed with the findings contained 

in the report, it appears that the Department of Interior clearly violated not only 

the spirit, but also the letter of several of the principles previously noted. 

The Department of Interior’s deceptive misrepresentation of peer-review in order 

to justify an offshore drilling moratorium presents a troublesome view of how this 

Administration views the role of science and technology relating to the Deepwater 

Horizon oil spill and the continuing response. As U.S. District Judge Martin Feldman recently wrote. 

‘‘Much to the government’s discomfort and the Court’s uneasiness, the Summary [of the Department of the Interior Report] also states that The recommendations contained in the report have been peer reviewed by seven 

experts identified by the National Academy of Engineering.’ As the plaintiffs, and the experts themselves:, pointedly observe, this statement was 

misleading. The experts charge it was a ’misrepresentation.’ It was factually incorrect.’’7

Therefore, by this letter, I request that the Department of Interior provide to the 

Committee all records, as defined in the attachment, relating to the Department of 

the Interior’s report titled ‘‘Increased Safety Measures for Energy Development on 

the Outer Continental Shelf.’’ This should include all drafts of the report and 

records of changes that were made. These documents should be delivered to room 

394 Ford House Office Building by 5 p.m. on Friday July 2,2010. If you have any 

questions or need additional information, please contact Mr. Tom Hammond, Investigations and Oversight Subcommittee Minority Staff, at (202) 225–6371. 

Sincerely, 

REP. PAUL BROUN, M.D. 

Ranking Member 

Subcommittee on Investigations And Oversight 

cc: REP. BRAD MILLER, Chairman, Subcommittee on Investigations & Oversight 

cc: THE HONORABLE JOHN HOLDREN, Director, Office of Science and 

Technology Policy, Executive Office of the President enc 

1Letter from Kenneth E. Arnold, PE, NAE to Gov. Jindal, Senator Landrieu, and 

Senator Vitter, undated (attached). 2White House Memorandum, Subject: Scientific Integrity, March 9,2009. 

3Letter from Rep. Paul Broun to Director Holden, July 14,2010. Letter from Rep. 

Paul Broun to Director Holden, October 2,2010. Letter from Rep. Paul Broun 

to Director Holden, December 1,2010. 4White House Memorandum, Subject: Scientific Integrity, March 9, 2009. 

5 NASA Policy on ‘‘The Release of Information to News and Information Media,’’ 

pp. 1–2. 6White House Memorandum, Subject: FY 2009 Administration Research and Development Budget Priorities August 14,2007. 7 Hombeck Offshore Services, LLC Et Al. V. Kenneth Lee ‘‘Ken’’ Salazar Et Al., No. 

10 Civ. 1663 (E.D.L.A. June 22, 2010). 

ATTACHMENT 

1. The term ‘‘records’’ is to be construed in the broadest sense and shall mean 

any written or graphic material, however produced or reproduced, of any kind 

or description, consisting of the original and any non-identical copy (whether 

different from the original because of notes made on or attached to such, copy 

or otherwise) and drafts and both sides thereof, whether printed or recorded 

electronically or magnetically or stored in any type of data bank, including, but 

not limited to, the following: correspondence, memoranda, records, summaries 

of personal conversations or interviews, minutes or records of meetings or conVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00040 Fmt 6633 Sfmt 6621 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
37 

ferences, opinions or reports of consultants, projections, statistical statements, 

drafts, contracts, agreements, purchase orders, invoices, confirmations, telegraphs, telexes, agendas, books, notes, pamphlets, periodicals, reports, studies, 

evaluations, opinions, logs, diaries, desk calendars, appointment books, tape recordings, video recordings, e-mails, voice mails, computer tapes, or other computer stored matter, magnetic tapes, microfilm, microfiche, punch cards, all. 

other records kept by electronic, photographic, or mechanical means, charts, 

photographs, notebooks, drawings, plans, inter-office communications, intra-office and intra-departmental communications, transcripts, checks and canceled 

checks, bank statements, ledgers, books, records or statements of accounts, and 

papers and things similar to any of the foregoing, however denominated. 

2. The terms ‘‘relating,’’ ‘‘relate,’’ or ‘‘regarding’’ as to any given subject means 

anything that constitutes, contains, embodies, identifies, deals with, or is in 

any manner whatsoever pertinent to that subject, including but not limited to 

records concerning the preparation of other records. 

Fax to: Gov. Jindal: 225–342–7099 

Senator Landrieu: 202–224–9735 

Senator Vitter: 202–228–5061 

From: Kenneth E. Arnold, PE, NAE 

3031 Shadowdale 

Houston Texas 77043 

832–212–0160 

cc. Dr. Robert Bea, Department of Civil and Environmental Engineering, University of California at Berkeley 

Dr. Benton Baugh, President, Radoil, Inc. Ford Brett, Managing Director, 

Petroskills 

Dr. Martin Chenevert, Senior Lecturer and Director of Drilling Research Program, Department of Petroleum and Geophysical Engineering, University of 

Texas 

Dr. Hans Juvkam-Wold, Professor Emeritus, Petroleum Engineering, Texas 

A&M University 

Dr. E.G. (Skip) Ward, Associate Director, Offshore Technology Research Center, 

Texas A&M University 

Thomas E. Williams, The Environmentally Friendly Drilling Project 

A group of those named in the Secretary of Interior’s Report, ‘‘INCREASED 

SAFETY MEASURES FOR ENERGY DEVELOPMENT ON THE OUTER CONTINENTAL SHELF’’ dated May 27, 2010 are concerned that our names are connected 

with the moratorium as proposed in the executive summary of that report. There 

is an implication that we have somehow agreed to or ‘‘peer reviewed’’ the main recommendation of that report. This is not the case. 

As outlined in the attached document, we believe the report itself is very well 

done and includes some important recommendations which we support. However, 

the scope of the moratorium on drilling which is in the executive summary differs 

in important ways from the recommendation in the draft which we reviewed. We 

believe the report does not justify the moratorium as written and that the moratorium as changed will not contribute measurably to increased safety and will have 

immediate and long term economic effects. Indeed an argument can be made that 

the changes made in the wording are counterproductive to long term safety. 

The Secretary should be free to recommend whatever he thinks is correct, but he 

should not be free to use our names to justify his political decisions. 

The Primary Recommendation in the May 27, 2010 report, ‘‘INCREASED 

SAFETY MEASURES FOR ENERGY DEVELOPMENT ON THE OUTER 

CONTINENTAL SHELF’’ Given by Secretary Salazar to The President Misrepresents our Position 

The National Academy of Engineering recommended us as contributors and reviewers of the recent Department of Interior ‘‘30 Day Review’’ of the BP Oil Spill. 

We were chosen because of our extensive petroleum industry expertise, and independent perspectives. The report states: 

‘‘The recommendations contained in this report have been peer-reviewed by seven 

experts identified by the National Academy of Engineering. Those experts, who 

volunteered their time and expertise, are identified in Appendix 1. The Department 

also consulted with a wide range of experts from government, academia and 

industry.’’ 

38 

The BP Macondo blow out was a tragedy for eleven families, and an environmental disaster of worldwide scale. We believe the blowout was caused by a complex 

and highly improbable chain of human errors coupled with several equipment failures and was preventable. The petroleum industry will learn from this; it can and 

will do better. We should not be satisfied until there are no deaths and no environmental impacts offshore—ever. However, we must understand that as with any 

human endeavor there will always be risks. 

We broadly agree with the detailed recommendations in the report and compliment the Department of Interior for its efforts. However, we do not agree with 

the six month blanket moratorium on floating drilling. A moratorium was added 

after the final review and was never agreed to by the contributors. The draft which 

we reviewed stated: 

‘‘Along with the specific recommendations outlined in the body of the report, Secretary Salazar recommends a 6-month moratorium on permits for new exploratory 

wells with a depth of 1,000 feet or greater. This will allow time for implementation 

of the measures outlined in this, report, and the consideration of information and 

recommendations from the Presidential Commission as well as other investigations 

into the accident. 

‘‘In addition, Secretary Salazar recommends a temporary pause in all current 

drilling operations for a sufficient length of time to perform additional blowout preventer function and pressure testing and well barrier testing for the existing 33 permitted exploratory wells currently operating in deepwater in the Gulf of Mexico. 

These immediate testing requirements are described in Appendix 1.’’ 

We agree that the report and the history it describes agrees with this conclusion. 

Unfortunately after the review the conclusion was modified to read: 

‘‘The Secretary also recommends temporarily halting certain permitting and drilling activities. First, the Secretary recommends a six-month moratorium on permits 

for new wells being drilled using, floating rigs. The moratorium would allow for implementation of the measures proposed in this report and for consideration of the 

findings from ongoing investigations, including the bipartisan National Commission 

on the BP Deepwater Horizon Oil Spill and Offshore Drilling. 

‘‘The Secretary further recommends an immediate halt to drilling operations on 

the 33 permitted wells, not including the relief wells currently being drilled by BP, 

that are currently being drilled using floating rigs in the Gulf of Mexico. Drilling 

operations should cease as soon as safely practicable for a 6-month, period.’’ 

We believe the moratorium as defined in the draft report addresses the issues evident in this case. We understand the need to undertake the limited moratorium and 

actions described in the draft report to assure the public that something tangible 

is being done. A blanket moratorium is not the answer. It will not measurably reduce risk further and it will have a lasting impact on the nation’s economy which 

may be greater than that of the oil spill. 

The report highlights the safety record of the industry in drilling over 50,000 

wells on the U.S. Outer Continental Shelf of which more than 2000 were in over 

1000 feet of water and 700 were in greater than 5000 feet of water. We have been 

using subsea blowout preventers since the mid-1960s. The only other major pollution event from offshore drilling was 41 years ago. This was from a shallow water 

platform in Santa Barbara Channel drilled with a BOP on the surface of the platform. 

The safety of offshore workers is much better than that of the average worker in 

the US, and the amount of oil spilled is significantly less than that of commercial 

shipping or petroleum tankers. The U.S. offshore industry is vital to our energy 

needs. It provides 30% of our oil production, is the second largest source of revenue 

to the U.S. Government ($6 Billion per year), and has a direct employment of 

150,000 individuals. The report outlines several steps that can be taken immediately to further decrease risk as well as other steps that should be studied to determine if they can be implemented in a way that would decrease risk even more. 

This tragedy had very specific causes. A blanket moratorium will have the indirect effect of harming thousands of workers and further impact state and local 

economies suffering from the spill. We would in effect be punishing a large swath 

of people who were and are acting responsibly and are providing a product the nation demands. 

A blanket moratorium does not address the specific causes of this tragedy. We do 

not believe punishing the innocent is the right thing to do. We encourage the Secretary of the Interior to overcome emotion with logic and to define what he means 

by a ‘‘blanket moratorium’’ in such a way as to be consistent with the body of the 

report and the interests of the nation. 

39 

The foregoing represents our views as individuals and does not represent the 

views of the National Academy of Engineering or the National Research Council or 

any of its committees. 

Kenneth E. Arnold, PE, NAE 

Dr. Robert Bea, Department of Civil and Environmental Engineering, University of 

California at Berkeley 

Dr. Benton Baugh, President, Radoil, Inc. Ford Brett, Managing Director, 

Petroskills 

Dr. Martin Chenevert, Senior Lecturer and Director of Drilling Research Program, 

Department of Petroleum and Geophysical Engineering, University of Texas 

Dr. Hans Juvkam-Wold, Professor Emeritus, Petroleum Engineering, Texas A&M 

University 

Dr. E.G. (Skip).Ward, Associate Director, Offshore Technology Research Center, 

Texas A&M University 

Thomas E. Williams, the Environmentally Friendly Drilling Project 

Dr. BROUN. Thank you. In my letter to the President, I asked 

that additional Members with broad technical expertise be added 

to the newly created National Commission on the BP Deepwater 

Horizon Oil Spill and Offshore Drilling. Currently only two scientists or engineers sit on that commission. I also requested that 

the commission report to Congress, not just to the White House. 

Before pursuing legislative fixes, it might make more sense to wait 

until this commission and other investigations taking place finish 

their work. 

In my second letter, which I sent to you, Mr. Secretary, I discuss 

the Department of the Interior’s recently produced report titled 

‘‘Decreased Safety Measures for Energy Development on Outer 

Continental Shelf.’’ As you are aware, the findings of this report 

were used to justify an offshore drilling moratorium in the Gulf. 

However, shortly after the report was released we discovered that 

the Administration had manipulated the findings of six of the eight 

peer reviewers from the National Academy of Engineering. 

The misrepresentation of the peer reviewers’ recommendations, 

in order to justify an offshore drilling moratorium, presents troublesome patterns of how this Administration views the role of 

science and technology relating to this disaster. This is not the first 

time that this Administration’s scientific integrity has been questioned. 

In addition, it appears that these politically motivated actions 

have become a bad habit with how the Administration has dealt 

with the Gulf oil spill. The Administration’s misdirected focus during this crisis reeks of political opportunism. 

Mr. Secretary, the letter I sent you outlines previously defined 

principles of scientific integrity, and raise many of the concerns I 

just mentioned. Can you please share with me the methods used 

to produce this report? 

Secretary SALAZAR. Congressman Broun, I would be happy to respond to those questions, and let me say a few points first. 

In terms of timing relative to legislative action and the ongoing 

crisis on the Gulf Coast, we can walk and chew gum at the same 

time. We can deal with containing the spill and killing the swell 

and protecting the great assets of the Gulf Coast, but we can also 

move forward with ideas like some of the idea that Chairman 

40 

Rahall and others have championed in this Committee in terms of 

a reform agenda. 

In September 19, I believe, of last year when I appeared before 

this Committee, and one of the subjects that was dealt with at that 

point in time was an organic act or what was then known as the 

MMS. So these are issues that have been in the hopper for a long 

time, and they are issues which I believe can be dealt with and 

should be dealt with now. 

I also believe that the sooner we deal with these issues in terms 

of a legislative framework and providing the resources that are 

needed to be able to do the enforcement and the inspections required will allow us to get to what many of you want to get to sooner, and that is to have an OCS program that can move forward 

safely and protective of the environment. 

Second, with respect to your statement on misrepresentation, let 

me just say with all due respect, Congressman Broun, you are 

wrong. There is nothing of the nature as you speak. The letter, as 

I have testified in this Committee, that I wrote to the President 

said that we were submitting a set of safety recommendations. 

Those safety recommendations are part of what has guided our efforts with respect to the notice to lessees. It is beginning to move 

forward with respect to a new safety regime in the Outer Continental Shelf. 

I also in that letter said I was recommending that we move forward with a moratorium, and I believe the moratorium was ripe 

then, I believe the moratorium is ripe today because we need to 

learn the lessons, and right now—I don’t want to repeat what I 

have already said, but there are a number of issues that need to 

be addressed at this point. 

Dr. BROUN. Mr. Secretary, I certainly hope you can walk and 

chew gum at the same time, and I trust that you can. I respectfully 

disagree with you on the moratorium, and from a scientific basis. 

I would also ask that a detailed response to my letter that I have 

just mentioned be provided in writing in a timely manner and include all the documents and drafts related to the report. I would 

remind you that your Department and the Administration must 

comply promptly with congressional requests from a Member of 

Congress, especially one who sits on two committees with jurisdiction over your Department. 

And as far as your final comment, I think a lot of the American 

people believe that the decisions made just reek of a political agenda, and not a scientifically driven agenda. 

The CHAIRMAN. The gentleman’s time has expired. 

Dr. BROUN. I believe strongly that policy cannot be made by 

science, but science can drive policy, and I hope that we can have 

science integrity, and I look forward to your response, Mr. Secretary. Thank you so much. 

The CHAIRMAN. The gentleman’s time has expired. The gentleman from Massachusetts, Mr. Markey. 

Mr. MARKEY. Thank you very much. 

The Obama Administration has authorized 17,500 National 

Guard troops to respond to this disaster in the four affected states: 

Louisiana, Mississippi, Alabama and Florida. However, it is only 

the Governor of a state that can actually deploy these troops, and 

41 

thus far only 1,675 are active. According to news reports, the Governor of Louisiana has only deployed 1,053 troops out of 6,000 that 

has been authorized. Alabama has deployed 432 of 3,000. Florida 

had deployed only 97 of 2,500, and Mississippi has activated 58 

troops out of 6,000. 

Mr. Secretary, this is the worst environmental disaster in our nation’s history. There is a hurricane in the Gulf. Shouldn’t the Governors of these four states immediately deploy all of the National 

Guard troops that have been authorized to respond? 

Secretary SALAZAR. Congressman Markey, the answer is yes as 

they are needed, and Secretary Napolitano, Director Bromwich and 

I were on the Gulf Coast probably within, we have been down there 

10 times there in Houston since it started, but we made a call from 

the command center to Secretary Gates and to the White House, 

and essentially gave the authorization to the states to move forward with the Coast Guard within a few days after this incident 

occurred. 

So it is before me. Frankly, surprising that you do not have the 

Governors of these states moving forward with the deployment of 

these National Guard’s troops, and we know at the end of the day 

the cleanup responsibilities ultimately are going to be paid for by 

BP. 

Mr. MARKEY. I agree with you, Mr. Secretary. I think we should 

really have an all hands on deck mentality, and not using these 

National Guard troops at this time I think really is a mistake. 

Mr. Secretary, we are now confronted with a situation in which 

hurricane season has arrived, and the well remains uncapped. Mr. 

Secretary, not only does BP’s oil spill response plan for the Gulf of 

Mexico not adequately prepare for the event of a hurricane if there 

was a spill, it does not contain the word ‘‘hurricane’’. Mr. Secretary, 

I sent a letter to BP today asking what preparations they had 

made for a hurricane in the spill response area. It is clear that BP 

wasn’t prepared for this kind of a double whammy—a hurricane on 

top of an oil spill. 

We do know in the BP response plan that they are prepared to 

evaluate walruses from the Gulf of Mexico even though no walruses live there in the last three million years. At the same time 

BP did not mention the word ‘‘hurricane’’ in their response plan. 

Do you believe, Mr. Secretary, that not just BP, but every oil 

company has a responsibility to actually have as part of their spill 

response capability, the ability to deal with a hurricane? 

Secretary SALAZAR. I do. The answer is yes. 

Mr. MARKEY. And have you talked to them right now about the 

level of preparation they have for a hurricane? 

Secretary SALAZAR. We have been approached by all of the major 

companies that have any significant ongoing activity in the Gulf of 

Mexico with a request that the moratorium that we have in place 

be lifted, and one of the questions that I asked these companies, 

and they were all the executives of these companies, was do you 

believe that there is a capability right now to respond to another 

oil spill if one were to occur in the Gulf of Mexico, and those are 

the kind of questions that need to be asked and they need to be 

answered before there is any lifting of the moratorium. 

42 

Mr. MARKEY. Well, I have introduced legislation to require oil 

companies to have real safety response plans that don’t plan on 

protecting walruses in the Gulf, and don’t plan on it always being 

sunny, 75 degrees without a breeze going through the Gulf because, unfortunately, we are seeing it right now as this hurricane 

at the beginning of the season descends on the Gulf. There could 

be catastrophic consequences as a hurricane hits an oil spill. 

Finally, Mr. Secretary, BP’s CEO Tony Hayward has said that 

BP did not have the tools in its tool kit to respond to this type of 

disaster. What is worse, the CEO of Exxon, Chevron, 

ConocoPhillips all said that their companies would not have been 

able to respond any better. 

Mr. Secretary, would you agree there needs to be a research program to develop twenty-first century oil safety and spill response 

technologies to ensure that if oil companies are going to drill ultra 

deep, then the technologies are there to make it ultra safe, and if 

an accident does occur that the technologies can respond ultra fast 

to that spill? 

Secretary SALAZAR. Congressman Markey, yes, I do believe that 

and let me, if I may, just add a comment to that. That is, in what 

really has become I consider to be an Apollo 13-type of a project 

that has gone on for a very long time. One of the things that is 

going on is essentially you have the most significant laboratory of 

learning. 

Yes, the consequences are dramatic and horrible from this oil 

spill, but there is a lot to be learned from what has happened with 

respect to the ongoing effort to containment what has worked, what 

has failed, et cetera, and so as a collective responsibility of Interior, 

of the Congress, of the industry, we need to make sure that those 

lessons are being learned, and then applied to the future and your 

focus on oil spill response capability is indeed a very high priority. 

Mr. MARKEY. Thank you, Mr. Secretary. Thank you, Mr. Chairman. 

The CHAIRMAN. The gentleman from Louisiana, Mr. Fleming. 

Mr. FLEMING. Thank you, Mr. Chairman, and thank you, gentlemen, for coming today and answering our questions. 

I want to get back to the moratorium. As my colleague Dr. Cassidy calls it so eloquently a jobs moratorium, at least to us in Louisiana. Just to quote something out of the report from, or actually 

the response by Judge Feldman to the moratorium request. It 

says,‘‘The report makes no effort to explicitly justify the moratorium,’’ and I think that is really the crux of this. It says it does 

not discuss any irreparable harm, which is a true barrier that must 

be overcome in order to put that in place, and yet, as I understand 

it, there are attempts to put in place another moratorium and I 

want to ask, Mr. Secretary, have you read or are you familiar with 

the letter from Governor Jindal dated June 29, regarding his response to a request by your Department to ask for comments on 

the new moratorium? 

Secretary SALAZAR. I have seen the letter from Governor Jindal. 

Mr. FLEMING. Mr. Chairman, I would like to enter this into the 

record with unanimous consent. 

The CHAIRMAN. Without objection, so order. 

43 

[The letter submitted for the record from The Honorable Bobby 

Jindal, Governor, State of Louisiana, follows:] 

BOBBY JINDAL 

Governor 

State of Louisiana 

Post Office Box 94004 

Baton Rouge, LA 70804–9004 

June 29, 2010 

Honorable Ken Salazar 

U.S. Department of Interior 

1849 C Street, NW 

Washington, D.C. 20240 

Re: Restructured OCS Deepwater Drilling Moratorium 

Dear Secretary Salazar: 

Thank you for your request for comment on the Department of Interior’s concept 

to restructure the deepwater drilling moratorium. The State of Louisiana’s priority 

is both to ensure that offshore drilling is conducted with the utmost safety and regulatory oversight and to ensure the environment and natural resources of the State 

are protected. Unfortunately, your request for comments by today on a concept without the ability to review and comment on a specific proposal does not comply with 

the Department’s obligation, as required by 43 U.S.C. § 1331, et seq., and 43 U.S.C. 

§ 1334(a), in particular. 

The State has not been provided any documents. Not only should a draft of the 

proposed moratorium be submitted, but also all documents supporting the proposal. 

Without these documents, the State cannot undertake a meaningful review and 

therefore a meaningful consultation cannot take place. Moreover, such a short time 

frame to receive comments is insufficient for the State to analyze the proposed moratorium, especially when the State has not been given any documents to analyze. 

As I noted in my letter to you dated June 2. 2010, and as we stated in the attached amicus curiae brief to the U.S. District Court, a six-month deepwater moratorium will have a devastating effect on Louisiana’s economy as the rigs may move 

to other countries for several years to come. The Louisiana Department of Economic 

Development estimated the loss of over 10,000 Louisiana jobs within just a few 

months. In addition, Louisiana stands to lose substantial tax revenues as result of 

six month moratorium due to a significant decline in income and sales taxes. It is 

critical that a six-month blanket moratorium not be imposed on our deepwater activity and that options are considered that allow for the continued drilling activity 

in the Gulf of Mexico 

The State is prepared to provide meaningful and timely feedback on any specific 

proposal, which ideally would propose to safely and promptly resume operations in 

the Gulf in a manner that protects the workers and the citizens of this State and 

the Gulf region, as well as provides the energy this country so desperately needs. 

Sincerely, 

Bobby Jindal 

Governor 

Attachment: Amicus Curiae Brief 

Mr. FLEMING. Well, I will just mention a couple of things in it. 

It says, ‘The State of Louisiana’s priority is both to ensure that offshore drilling is conducted with utmost safety and regulatory oversight, and to ensure the environment and natural resources of the 

state are protected.‘ 

‘‘Unfortunately, your request for comment by today,’’ which was 

June 29, yesterday, ‘‘comments by today on a concept without the 

ability to review and comment on a specific proposal does not comply with the Department’s obligations as required by 43 U.S.C. 

1331 and 43 U.S.C. 1334[a] in particular.’’ 

44 

What he is saying here, in essence, is you are asking us to comment on this new moratorium but you haven’t given us any documentation. Are you willing, sir, to delay putting forth this moratorium until you indeed provide those documents to the Governor 

and allow him to comment on those? 

Secretary SALAZAR. Congressman Fleming, first, I am confident 

that the imposition of the moratorium was a correct decision, and 

I respectfully disagree with the District Court decision, and Department of Justice, and Interior has taken that up on appeal to the 

Fifth Circuit. We believe that decision was correct. 

We also believe that the last 70 days essentially by themselves, 

if you will, make an Exhibit A as to why the moratorium is essential. Seventy-one days of following all of the efforts to try to deal 

with this blowout tell us that industry does not have the ability to 

quickly deal with this kind of blowout scenario. So until we get to 

the point where we believe that we can have that assurance of 

safety we will continue to have our hand on the pod’s button. 

Mr. FLEMING. In other words, no, you will not delay the moratorium and allow the Governor or the State of Louisiana to make 

those comments and input. Is that the—— 

Secretary SALAZAR. We worked closely with Governor Jindal on 

a number of—— 

Mr. FLEMING. OK. 

Secretary SALAZAR.—different points, but we are going to move 

forward and we are going to do what is right. 

Mr. FLEMING. OK, I will accept that as a no. 

Well, just to kind of hit the top points here, in the first moratorium we had eight scientific experts who disagreed and did not feel 

that it was appropriate to put this into place. We have a history 

of over 40 years and over, I think, about 3,600 drilling units out 

there in the Gulf, which have never had a problem. To this day, 

we still don’t know what went wrong. We had BP and Transocean 

here just the other day. They were shrugging their shoulders. They 

say, even we don’t know what went wrong. 

I see the smile on your face. They probably know more than what 

they say they know, and I would agree with you on that. But I 

don’t think we have actually come to an exact answer as to what 

happened. And then we have the letter on the comments, on which 

our Governor was not allowed to give input, and then finally we 

are talking about proposing legislation here by July 14th, and we 

don’t even know what went wrong. 

So, isn’t this, sir, really more about politics than it is about policy, and certainly about science? 

Secretary SALAZAR. Absolutely not, Congressman Fleming. The 

fact is that the President and our Administration have acted to 

deal with what is a national crisis that we are facing in the Gulf 

of Mexico. We have not done anything based on any political motivation here. We have a problem, and our job is to fix the problem, 

and that is what we are about, and part of fixing the problem is 

getting the kind of legislative framework and support so that we 

can assure that there is safety, the right kinds of standards, and 

the right kind of enforcement with respect to the Outer Continental 

Shelf, which is part of the reason why I think this hearing is such 

an important hearing to have. 

45 

Mr. FLEMING. And I will respectfully disagree. I think this is 

more about the Rahm Emanuel, ‘‘Never let a crisis go to waste’’ despite what we hear from the Administration. Mr. Secretary, the 

facts really don’t add up to anything other than this is a, in my 

opinion and I think to many on the panel here, that this is more 

about political manipulation. Thank you, sir. 

The CHAIRMAN. The gentleman’s time has expired. The gentleman from Maryland, Mr. Sarbanes. 

Mr. SARBANES. Thank you, Mr. Chairman. 

First of all, I wanted to thank Secretary Salazar for your visit 

the other day to Maryland as part of the President’s Great American Outdoors Initiative, and I think being on this listening to us 

even as you are managing the Gulf spill is critical because you are 

hearing from Americans all across the country as to what their perspective is going forward on offshore drilling and oil and gas development more broadly, and so I thank you for that, and it was really 

a treat to have you there in Annapolis. 

The second thing I just wanted to mention is, and Congressman 

Wittman spoke to this a little bit, but, of course, I am particularly 

focused because of the Chesapeake Bay on this Lease Sale 220. I 

know that has been withdrawn at this point. I just wanted to say 

that going forward you can put me in the category of those who 

will be pretty resistant to putting it back on the table because I 

think that the sensitivity of that area off the coast of Virginia is 

critical to the health of the Chesapeake Bay, and the potential risk 

there is just too high. 

Also, when you look at other areas that are going to probably be 

off limits because of the Department of Defense concerns and so 

forth, we are talking about something marginal, I think. 

I did want to ask a couple of question. The first was we have had 

plenty of testimony in a number of different committees about the 

flaws in the response plans that were developed by BP and the rest 

of the industry, and I know that currently in law there is some 

process by which these companies sort of certify as to the accuracy 

and due diligence behind these plans, but it is not all that robust 

from what I can gather, and I was interested in your perspective 

and Director Bromwich’s as well on whether you think it might be 

a good idea to have the CEOs of these companies have to, in effect, 

personally certify to the adequacy of these plans, that they have 

gone through a rigorous process, and potentially with that personal 

certification bears some civil liability if it turns out that the right 

kind of practices were not in place, and the process wasn’t carried 

forward because I think that would create the right kind of behavior modification within the industry if you have people at the top 

who are responsible for this. 

Secretary SALAZAR. Congressman Sarbanes, first, thank you for 

your leadership with No Child Left Inside, and all the work that 

you are doing with respect to young people and connecting them to 

the outdoors. 

Second, with respect to your very important question, it is something that needs to be looked at relative to how we look forward 

with oil spill response plans that are in fact workable. There is no 

doubt at all that there is an oil spill response plan that is being 

actuated today as we speak in the Gulf of Mexico, and it has been 

46 

underway since April 20. There is also no doubt that it has been 

inadequate. So the kind of questions that you raise are exactly the 

kinds of questions we are all examining as we decide how we are 

going to move forward. I will turn it over to Director Bromwich to 

amplify. 

Mr. BROMWICH. I think your suggestion about requiring a certification is an interesting one. It is obviously a pattern on certifications that are required by CEOS and CFOs, required by Sarbanes-Oxley legislation. 

I know from having been in the private sector for a number of 

years that that requirement for certification has focused the mines 

of corporate executives on their responsibilities, and has forced 

them to engage more deeply in making sure that the information 

that was contained in corporate financial statements are correct. 

And so as a result of that experience in the corporate sector, I 

think your proposal has to be taken very seriously. 

Mr. SARBANES. Thank you, and I have about 40 seconds left so 

the second question real quick is, there is a pilot project in the proposed legislation that Chairman Rahall has developed which would 

look at the opportunity to measure more accurately and through 

the use of technology exactly what is coming out at the wellhead 

in terms of the volume of gas and oil that is emitted there, and I 

think the idea is over time to develop that as another source of figuring out what the right kind of royalty payment should be. 

What I am curious about is whether you think it is a good idea 

to ultimately cut to the chase and say that we are going to determine the royalties by applying it right against what is coming out 

of the wellhead because the process for determining royalties is 

kind of a hocus-pocus one once you get further up the chain. So I 

would like your reaction to the proposal to actually use that volume 

measured at the wellhead as the basis for determining royalty. 

Secretary SALAZAR. Congressman Sarbanes, first, the whole question of royalty simplification is something which we have been 

working on. I have not reviewed this particular language in the 

legislation, but we would be happy to do that, and to get back to 

the Chairman and you with respect to our response on the legislation. 

Second, let me say one of the things that we have learned in this 

71-day ordeal is that there was a significant lack of instrumentation relative to what is happening on the well, on the blowout preventer, and a whole host of other things, so Secretary Chu and our 

whole science team that we have had focused on this problem has 

actually brought much of their knowledge on instrumentation and 

pressure valves and a whole host of other things into this equation. 

So I think this will be one of the lessons learned from this Deepwater Horizon tragedy. 

Mr. SARBANES. Thank you very much. I yield back. 

The CHAIRMAN. Thank you. Mr. Secretary, we know yo have to 

go. Thank you. 

Secretary SALAZAR. Thank you very much, Mr. Chairman, and 

distinguished members of the Committee. 

The CHAIRMAN. Our next Member is the gentleman from Colorado, Mr. Coffman. 

Mr. COFFMAN. Thank you, Mr. Chairman. 

47 

Mr. Bromwich, the question I had was for Secretary Salazar but 

I will go ahead and address it to you, and that is because it concerns MMS, which you have a brand new name for it now, but 

when Secretary Salazar addressed the ethics questions, a number 

of questions that came out of, I think, the September 2008 IG report that I think were well addressed, I think, by Secretary Salazar, but President Obama in his Oval Office speech a couple of 

weeks ago, when discussing MMS, said, and I quote, ‘‘The pace of 

reform was just too slow.’’ And what I think that he referred to was 

the other problems at MMS outside the ethics issues that were to 

the competency and execution of their oversight of offshore drilling. 

Obviously, MMS has been a problem agency for a very long time. 

In the late 1990s, someone at MMS failed to include a price threshold on OCS leases and GAO estimated this cost the U.S. taxpayers 

up to $14 billion. Even though the work done by Secretary Salazar 

to clean up MMS in Denver, the Denver office, though there were 

still problems at MMS Gulf Operations, on various press releases 

that four monthly inspections of the Deepwater Horizon in this 

past year were not done; that permits were approved in as little 

as five minutes; and other indications that MMS was just not doing 

a good enough job. 

How much do you think that these errors contributed to the 

disaster, particularly not doing the inspections on Deepwater Horizon, and do you think that they should have been addressed more 

vigorously? 

Mr. BROMWICH. The short answer is I don’t know, and I don’t 

think we know whether and to what extent the failure to do comprehensive timely inspections contributed in any way to the disaster. I think the evidence that has come before the public so far, 

and it is obviously fragmentary, is that there were a combination, 

as I think has been referred to before, of human and equipment errors that is the responsibility of BP. 

It is undoubtedly true, though, that the resources of my agency 

that it can allocate to inspections is grossly inadequate. I believe 

there are 62 inspectors to inspect the thousands of installations in 

the Gulf alone, and that is in stark contrast to the numbers in 

other parts of the country, so there is absolutely no question that 

this agency has been inadequately staffed with respect to inspections, and that is something that really needs to change. 

Mr. COFFMAN. How about inadequate leadership? 

Mr. BROMWICH. I was brought in because of my experience in 

leading agencies, and I hope to make a big difference in this agency. 

Mr. COFFMAN. So your view is that it is not just papered over by 

more money. The fact is that people weren’t doing their job that 

were assigned to do their job, and that the Secretary of the Interior 

was not aware during the 16-month tenure that these people were 

not doing their job. 

Mr. BROMWICH. Well, you are making statements and assumptions that haven’t come from me. 

Mr. COFFMAN. Do you think that the Secretary was aware that 

these inspections were not taking place? 

Mr. BROMWICH. No, I didn’t say that either. I don’t know whether this was preventable by timely and repeated inspections or not, 

48 

and I think we will never know that. That is what I am saying 

and—— 

Mr. COFFMAN. Won’t—— 

Mr. BROMWICH. Let me finish, please. 

Mr. COFFMAN. No. Won’t the investigation look at the issue of 

the failure of this Department to conduct inspections, and what the 

ramifications of the failure relate to this crisis? 

Mr. BROMWICH. I think there are multiple investigations going 

on that will explore that issue. Whether anyone is ever going to be 

able to draw a specific cause and effect relationship between inadequate number of inspectors and inadequate inspectors—— 

Mr. COFFMAN. Don’t you want to know that? Don’t you want to 

know whether or not the failure to conduct these inspections related to this crisis? Don’t you want to know that? 

Mr. BROMWICH. Of course. Of course. We all do. 

Mr. COFFMAN. And you are going to find that out, I hope. 

Mr. BROMWICH. I am not going to find that out but the multiple 

investigations are going to find that out, that is right. 

Mr. COFFMAN. Chairman, I yield back. 

The CHAIRMAN. The gentleman from Arizona, Mr. Grijalva is recognized. 

Mr. GRIJALVA. Thank you, Mr. Chairman, and at the offset I 

have a couple of questions for Mr. Bromwich, but at the offset let 

me say that I am a Member of Congress that is very appreciative 

of the recommendations that Secretary Salazar made to the President for the moratorium on deep sea drilling. I think that was prudent, it was necessary, and given what we know up to this point, 

the lack of response capability by the company, lacks oversight by 

the agency, a coziness that has been brought up time and time 

again between the agency, and this is not all new. This has been 

a decade of building, and while the moratorium is bringing hardship to many, I think it is still the wise and prudent thing to do 

until we are sure that another catastrophe is not going to finish 

devastating that region. This has taken 10 years to get here, and 

in those 10 years, you know, all the things that we are finding out 

now have been building, and I think it is important to stop, pause, 

and reassess where we are at, and where we need to be in the future. 

I think there are also some parallels, Mr. Chairman, between offshore and onshore, and the comments that were made by the Secretary about the necessity to talk to the Bureau of Land Management in terms of their permitting process, their categorical exclusion process regarding NEPA, their inspections and oversight, I 

think is an appropriate next step. 

The question I have, Mr. Bromwich, is in your view what 

changes need to be made in the industry’s behavior to improve environmental and safety performance? 

We have been talking for the last few months about how to reorganize your agency and other government agencies, how we are 

going to fund the cleanup, what organic legislation needs to be put 

together, but we have talked less about what the companies themselves can do to prevent the disaster that we are dealing with. 

What steps would you like to see taken in the short and the medium and in the long terms to make sure that this doesn’t happen 

49 

again, and where that part of that responsibility is falling on industry and their behavior, and your comments on that? 

Mr. BROMWICH. Thank you. Thank you very much, sir. 

I think it is necessarily a cooperative relationship between the 

Department of the Interior and my agency specifically and the oil 

companies, oil and energy companies. We will certainly welcome 

the suggestions that they have on how to enhance and tighten up 

necessary regulation, but it is essentially my agency’s responsibility 

and the Interior Department’s agency to take a look at the regulations that exist and make determinations as to whether they are 

adequate based on what we now know and what we are learning 

about the risks that offshore drilling can create. 

And so we are going to be taking a very hard look at whether 

the existing regulatory structure is adequate. We know that the resources that have been allocated to regulation and enforcement 

have been inadequate, and so I think we have to look at both, both 

the regulations that exist and the resources allocated to regulation 

and enforcement. 

I think there have been a lot of allegations and I think significant evidence that there has been too cozy a relationship between 

regulators and the industry. That is not going to continue. We are 

going to have an arm’s-length, tough, aggressive regulatory program. It is going to be fair, it is going to be even-handed, but it 

is going to be tough, and in cases of violations of the regulations 

substantial sanctions will be imposed, and in the case of willful violations of the regulations extraordinarily serious sanctions will be 

imposed. 

Mr. GRIJALVA. Mr. Director, one other question that I brought up 

a couple of times that has to do with BP Atlantis and the whistleblower who has been telling anybody that would listen that the rig 

is operating without engineer approved safety documents. 

I asked for a set of documents at a subcommittee hearing, and 

as you go forward with the reorganization a couple of questions: 

how are we going to deal better with those whistleblower claims 

and concerns; and two, the lingering question about BP Atlantis, 

and if that has been fully and properly and scientifically looked at 

in terms of not having to deal with any spillage or any catastrophe 

there. 

Mr. BROMWICH. Let me take your second question first. I don’t 

know the exact status of the examination of the BP Atlantis matter. I have been on the job eight days as you know, and I know 

that there are people looking at it and resources being allocated to 

looking at it, but I can’t give you a specific account of where that 

stands. 

With respect to more generally dealing with whistleblower complaints, one of the reasons I created the unit last week, the Investigations and Review Unit, is to specifically give me a SWAT type 

capability to deal with allegations, including whistleblower allegations, and to run them to ground very quickly to determine whether there is substance behind them or not. 

I think that in my tenure as Inspector General for the Department of Justice from 1994 to 1999, I had a lot of experience dealing 

with whistleblower allegations. I learned that certainly not all 

whistleblower allegations are true, but that they need to be taken 

50 

seriously. They cannot assume to be false because in fact many of 

the allegations that on first blush appeared to be frivolous turned 

out to be true, and many allegations that appeared to be accurate 

turned out to not have evidence to support them. So whistleblowers 

are important. Their allegations need to be taken seriously, and 

they need to be investigation serious, and I am going to do that. 

Mr. GRIJALVA. Thank you. Thank you, Mr. Chairman. 

The CHAIRMAN. The gentleman from California, Mr. McClintock. 

Mr. MCCLINTOCK. Thank you, Mr. Chairman. 

Mr. Bromwich, the President and the Secretary have spoken extensively about the need to reduce America’s reliance on foreign oil 

and also after this disaster, upon the need to reduce our reliance, 

particularly on deep sea drilling, and yet the Secretary today in his 

written testimony boasts of canceling the upcoming Beaufort and 

Chukchi lease sales in the Arctic, removing Bristol Bay altogether 

from leasing both the current five-year plan as well as the next 

five-year plan, removing the Pacific Coast in the Northeast entirely 

from any drilling under a new five-year plans, and I am just wondering how do we reduce our reliance on foreign oil by putting off 

limits American, domestic supplies? 

Mr. BROMWICH. I don’t think anybody is putting off limits domestic supplies. I think, as the Secretary said, what seem to be dictated by the Deepwater Horizon accident was pushing the pause 

button, trying to figure out what happened, and what we learned 

should shape our deepwater drilling policy. So my understanding 

is that a large number of entities are investigating that matter. I 

am sure the Secretary and certainly I will be looking very carefully 

at what those investigations conclude, and that will shape, I assume, the Secretary’s decisions and the Administration’s policy as 

to what to do. 

Mr. MCCLINTOCK. By pushing that pause button though you are 

making us more and more reliant on foreign oil supplies, and by 

placing surface production off limits you are making us more and 

more reliant on deep sea drilling. 

Mr. BROMWICH. My understanding is that in response to the 

quite unexpected and unprecedented disaster in the Gulf, the 

President and the Secretary thought that the actions that they had 

taken were the prudent things to do. I wasn’t around when those 

decisions were made, but that is my understanding as to what the 

reasons were. 

Mr. MCCLINTOCK. That judgment is open to very, very serious 

question. 

Let me move to the disaster itself. Blowouts have occurred before. Why is it that there was no contingency plan in place? 

Mr. BROMWICH. I can’t answer that question. I don’t know the 

answer. 

Mr. MCCLINTOCK. According to published reports, there was a 

contingency plan that involved corralling and burning the oil as it 

reached the surface, and that was shelved by the Department of 

the Interior as the disaster unfolded. 

Mr. BROMWICH. I have no knowledge of that. 

Mr. MCCLINTOCK. We keep seeing reports of the Jones Act interfering with the volunteering of foreign vessels for the assistance in 

this bill. We saw a report last week of oil skimmers being shutVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00054 Fmt 6633 Sfmt 6602 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
51 

down by the Coast Guard because they didn’t go through a proper 

Coast Guard inspection for life vests. We have, of course, heard the 

complaints of the Governor of Louisiana that he cannot get permission to build berms to protect his coast. 

The picture is becoming one of a tangled and dysfunctional bureaucracy tripping over itself. Would you care to comment on that 

now that you have inherited that mess? 

Mr. BROMWICH. Well, my sense is that this disaster was unexpected, unprecedented, and therefore they really could not and 

there was not a plan for dealing with specifically what happened. 

I know the government has mobilized its resources, and were they 

ready and was it as smooth an efficient operation from day one? 

I think the answer to that is no. I think the Administration has 

acknowledged that the answer was no. But I think that now as we 

are on day 70 or 71 my impression again from listening to accounts 

and the development of a concentrated and coordinated effort is 

that things are vastly improved, and that real progress is being 

made. 

Mr. MCCLINTOCK. We keep hearing these assurances but the 

Coast Guard incident occurred just a week ago. What is going to 

be done—well, let me just ask you this question. On the Jones Act 

itself, why is it that the Administration has not waived that Act 

so that additional resources can be brought to bear on the problem? 

Mr. BROMWICH. I don’t know the answer to that. You may have 

lost your answer when Secretary Salazar left. I really don’t know 

the answer to that. 

Mr. MCCLINTOCK. One of the disadvantages of being a freshman. 

Thank you. 

Mr. GRIJALVA [presiding]. Thank you. Ms. DeGette. 

Ms. DEGETTE. Thank you very much, Mr. Chairman, and I would 

like to welcome you, Mr. Bromwich. I think you will be happy you 

took this job. I hope so because you come with great recommendations. 

Mr. BROMWICH. Thank you. 

Ms. DEGETTE. When Mr. Coffman was asking you about the 

agency and the resources of the agency, one of the answers you 

gave about what is admittedly a very poor regulatory oversight 

scheme before in the MMS was that the agency needs more personnel to be able to review these applications, and as you can imagine in Congress here we hear this all the time. I mean, everybody 

needs more personnel. Everybody needs more resources, and certainly we can’t disagree that MMS or now the new regulatory 

scheme will need adequate resources and personnel, but as someone who spent years overseeing the FDA you could put a limited 

resources and personnel and still not do the job. 

So I am wondering if you could talk briefly about your intent as 

well as requesting new resources and personnel—kind of prioritize 

some of these applications and these processes, because it is true 

there are many, many offshore sites. However, it is also true that 

there are very few deepwater sites and certainly even fewer with 

the complexity of this site. And so it would seem that as you are 

revamping the agency you are going to need to take those things 

into consideration. I am wondering if you can share any initial 

thoughts with us. 

52 

Mr. BROMWICH. First, thank you for your kind words. Second, 

yes, they are only preliminary and initial thoughts. I think that in 

addition to getting an enhancement of resources, which I think 

there is almost universal acknowledgement that the agency needs, 

we need to examine the way that the inspectors and inspection 

teams have done their work. We also need to examine the way that 

the people who were reviewing lease applications and permit applications have prioritized what they are doing. 

I can tell you that there will be a top to bottom review of all aspects of what my agency currently does with an eye first to ensuring safety and environmental soundness, but also making sure that 

drilling that should go on needs to go on does go on. 

Ms. DEGETTE. What is your timeframe for that review, and I am 

assuming you will be happy to come back and talk to this Committee about your findings and your plans? 

Mr. BROMWICH. Absolutely. I don’t have a timetable yet for it. I 

have, frankly, spent most of my time here up on the Hill in front 

of various committees, so I literally have not been able to even yet 

talk to most of my staff. So I don’t want to give you an estimate 

as to how long it will take that I am giving you totally on the fly. 

Ms. DEGETTE. I am assuming you are moving with all due speed 

though because of this—— 

Mr. BROMWICH. Faster than that, yes. 

Ms. DEGETTE. OK. 

Mr. BROMWICH. Absolutely. 

Ms. DEGETTE. I want to ask you a couple of specific questions 

you might not yet know the answer to these questions but, Mr. 

Chairman, we are looking at this CLEAR Act and it has a lot of 

reforms that we believe are important to updating the regulatory 

scheme. One of the areas that I specifically want to talk about is 

Section 229, which is online availability to the public of information 

relating to oil and gas chemical use. What this section does is it 

requires that the list of chemicals used in drilling or completing a 

well on BLM land made available online within 30 days of completion. This requirement is similar to a requirement in a bill that 

Representative Hinchey and I introduced on disclosure of components of hydraulic fracturing fluid, and so I am very supportive of 

this section of the bill. 

I am wondering if your agency favors disclosure of the chemicals 

that are used in drilling on BLM Land. 

Mr. BROMWICH. The short answer is I don’t know. As you describe the proposal, it sounds intuitively like an appealing requirement. Whether there are reasons why it is not as good an idea as 

it sounds like to me, I don’t know, so again that is the best answer 

I can give you at this time. 

Ms. DEGETTE. Would you mind having someone from your agency supplement your answer so that we can get some sense as we 

move forward with this legislation? 

Mr. BROMWICH. Absolutely. 

Ms. DEGETTE. I will tell you as someone who has known Ken 

Salazar longer any anybody in Congress I would assume he would 

support it, but we will let your agency speak for itself. 

53 

Mr. BROMWICH. And just so you know, my inclination is to be as 

transparent as possible on almost everything. I just don’t know if 

there are reasons that I am not aware of that militate against it. 

Ms. DEGETTE. Sure. 

Mr. BROMWICH. So I don’t want to make a commitment that I 

would then later have to retract. 

Ms. DEGETTE. Sure. Section 226 of this CLEAR Act requires the 

Interior Department to develop best management practices for environmentally responsible development of oil and gas on Federal 

lands. What types of best management requirements would you 

consider in implementing this provisions, and have you learned 

anything from the Deepwater Horizon catastrophe that will inform 

those best management practices? 

Mr. BROMWICH. The short answer is that this again I am sorry 

to say is something that I have not yet had the chance to look at, 

but certainly in other fields that I have worked in both in government and outside of government paying close attention to what 

best management practices are and trying to formulate them in a 

reasonable way is an important part of making things work better. 

Ms. DEGETTE. I am sure we all look forward to your next appearance so you can explain all of these issues. 

Mr. BROMWICH. Great. Thank you. 

Ms. DEGETTE. Thank you, Mr. Chairman. 

Mr. LAMBORN. Mr. Chairman. 

Mr. GRIJALVA. The gentlelady’s time has expired. 

Mr. LAMBORN. Mr. Chairman. May I suggest to my colleague 

from Colorado that she is probably the number two person who has 

known the Secretary the longest, and I would suggest John Salazar 

has known him longer. 

[Laughter.] 

Ms. DEGETTE. Point well taken and the record will be corrected. 

The CHAIRMAN. The gentleman from Louisiana, Mr. Cassidy is 

recognized on his own time. 

Mr. CASSIDY. Thank you, Mr. Chairman. 

Mr. Bromwich, you know, when the Secretary said that his boot 

is on the neck of BP, the workers back home feels like the boot is 

on their neck, and, of course, they are the ones who are not hurting 

Tony Hayward, it is the rig workers. Now, as it turns out it is not 

just the deepwater rigs it is also back home, and I know there is 

a different message coming out of the Department, that there is, 

in effect, a de facto moratorium on shallow-water drilling, that, 

sure, we hear it is going to be an easy process and Bob Abbey came 

by and spoke about it, but it is not. 

What do I have here? As of May 6, only two shallow water permits have been issued. They were rescinded quickly. Then some 

others were put out, but these are not for new rigs. There are approximately 17 shallow water rigs now idle waiting for work that 

would be provided through the issuance of new drilling permits, 

and notably the 17 idle rigs were all operating prior to the job moratorium. They represent more than 38 percent of the available 

marketable rigs. 

Now how can we kind of get a straight statement, or let me just 

ask you, I don’t want to it pejoratively, and I apologize. I am hearVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00057 Fmt 6633 Sfmt 6602 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
54 

ing from back home that there is a de facto moratorium. In the 

Members’ brief the other day you said no, no. What is the story? 

Mr. BROMWICH. Well, my understanding is that there is not a de 

facto moratorium; that there are some additional requirements that 

have been imposed by the notice to lessees that have gone out 

within the last 30 days. My understanding is that there are specific—that completed applications that satisfy those new requirements have been filed as I think the day before yesterday, and my 

understanding is that my agency is looking at those with the intention of granting those that merit it. 

So there is no de facto moratorium that I am aware of. I have 

certainly given no instructions, Mr. Cassidy, to slow, walk or stop 

applications, and I think it is a matter of companies complying 

with the new requirements that have been imposed. So there is no 

de facto moratorium, but I think that the new requirements are 

what is taking the additional time. 

My understanding, Mr. Cassidy, and I think we talked about this 

at the meeting last Thursday, is that my agency is doing everything possible through frequent phone calls with members of the 

affected industry to try to answer—— 

Mr. CASSIDY. Not to be rude, I accept that. 

Mr. BROMWICH. Yes. 

Mr. CASSIDY. So ideally, and it was after that that I felt reassured, and then yesterday I get this which tells me, no, indeed 

there is still, in fact, a de facto moratorium. 

Mr. BROMWICH. And what is that? 

Mr. CASSIDY. This is messages from back home. 

Mr. BROMWICH. OK. OK. My understanding, again, from talking 

to participants on those phone calls is that they felt and believed 

that they had answered questions that the industry was posing to 

them, and that people felt a lot more sure about what they expectations were. So there may be a disconnect between what my people 

believe is being communicated and what may be understood. I suspect that there is not a misunderstanding on the part of people 

who were actually on the call and who had an opportunity to ask 

the questions and get their questions answered, but as the answers 

trickle down the line perhaps something is being lost in the translation. 

Mr. CASSIDY. We will research it and come back to you. 

Mr. BROMWICH. Yes, that sounds appropriately. 

Mr. CASSIDY. Now speaking about the CLEAR Act, there actually 

seems to me kind of a weirdness here in the sense that when it 

comes to what went wrong we have a sense from the White Paper 

of what went wrong, and what definitely can be taking place to 

allow OCS drilling to proceed, particularly since your agency has 

these plans on file. But we won’t proceed with that even though we 

have a definite White Paper with specific recommendations, et 

cetera. 

On the other hand, the CLEAR Act, which we yet haven’t had 

the commission, and there are all these uncertainties regarding 

what really went wrong from other aspects, for example, the response, we are going to proceed with without hearing the commission. 

55 

Now there seems to be a kind of oddness about that. We don’t 

proceed where we have definite answers but we proceed before we 

have answers on those other areas where we have no answers. 

Your thoughts on that. 

Mr. BROMWICH. Well, again, my ninth day on the job, I haven’t 

read the CLEAR Act, I don’t know what the specific requirements 

are that are contemplated in the CLEAR Act so I really cannot 

speak to the disconnect you are sensing. I am happy to come back 

later on when I am better informed on the specific provisions in the 

CLEAR Act, but I am really not able to help you today. 

Mr. CASSIDY. That is fair, that is a fair question. Before I go on 

to another, I am almost out of time, in deference to colleagues I 

will yield back. Thank you. 

The CHAIRMAN. The gentleman from Washington, Mr. Inslee. 

Mr. INSLEE. Thank you. It seems to me as we go forward to try 

to prevent another tragedy like this we ought to take a look at how 

we do a regulatory system in aviation, and in my evaluation of this 

industry this appears to be wildly below the safety standards of the 

aviation industry, in large part because of our FAA regulatory system. 

In the aviation context the way it works is the FAA essentially 

establishes a standard of performance that you will not have, for 

instance, a loss of hydraulic system that controls your control surfaces more than one in a billion take-offs or some number. It establishes a statistical expectation for the industry to meet. 

It then requires the industry to provide engineering data to show 

that every particular critical system will meet that statistical expectation, and then it is rigorously evaluated. It seems to me that 

is a template that we ought to consider following in this industry. 

An alternative way is to provide specific item-by-item requirements as to each particular process, or maybe we do both. I guess 

the question is as we go forward should we create an expectation 

of a statistical performance level for every critical part of this process and then expect the industry to provide engineering data that 

their systems will meet that? It seems to me that is a systematic 

way of going about this that makes sense. What are your thoughts 

about that kind of approach? 

Mr. BROMWICH. I am not nearly as familiar as you are with the 

standards in the aviation industry or the particular regulatory 

scheme that has been established by the FAA. I think the truth is 

that the regulation in this field, that is, the oil and gas field and 

the offshore in particular, has a lot to learn from a lot of places. 

And so as we craft what will be a newly revamped and reformed 

regulatory regime I think and hope that we are going to be looking 

at a wide variety of regulatory schemes, kind of best practices if 

you will, and see how relevant and analogous they are to what we 

need to impose, and so I hope we take what is good from column 

A, what is good from column B, and what is good from column C, 

and therefore create sort a best of class, best of breed regulatory 

scheme. 

So I am very interested in the aspects of the FAA regulatory 

scheme that you are describing. I am not knowledgeable yet 

enough to have an opinion as to how much of that is graphable on 

56 

the oil and gas regulation that I am going to be responsible for, but 

I am interested in talking with you about that further. 

Mr. INSLEE. Well, I would like to do that. For instance, the blowout preventer, highly technical, sophisticated piece of equipment 

that has some analogy to aircraft, and I think we do need to establish performance standards that are several orders of magnitude 

higher than we have right now. You know, for instance, we found 

in our investigation that as many as 50 percent of these things 

failed under actual conditions. Nobody gets on an airplane if 50 

percent of them crash. 

So, I will look forward to working with you. I will be proposing 

some amendments in that regard. 

Mr. BROMWICH. Terrific. 

Mr. INSLEE. The second thing we think we ought to have is an 

expectation that the industry uses best available technology. That 

is also an expectation in the industry, that the best available technology in fact will be used. What are your thoughts about that performance standard? 

Mr. BROMWICH. Again, intuitively it sounds sensible to me. It is 

a little bit puzzling why an industry would use anything other than 

that. I know that cost considerations loom large. I understand that 

these companies are properly out to make a profit, but they certainly should not and cannot do that at the expense of taking the 

necessary precautions. 

Mr. INSLEE. Well, unfortunately, I think that has been the case 

just with one thing we have come across. For instance, having a 

remote acoustically activated device that would activate the blowout preventer if the communications was lost with the drill rig, it 

is used in other countries, not here. It is the best available technology and I think we want to move forward. 

By the way, we have found several sort of red lights that BP ran 

through consciously; a decision not to do a cement log test to find 

out if you had a problem with gas escape; a decision to go with six 

centralizers rather than 21 as the analysis called for; a decision to 

use the long string rather than a liner, all of which created increased risks of failure. 

Were any or all of those signed of by MMS? Do you know yet 

whether that happened? 

Mr. BROMWICH. I don’t know the answer to that. I am confident 

that in the multiple investigations that are being conducted those 

specific questions are in the process of being answered. 

Mr. INSLEE. Thank you. I look forward to working with you. 

Mr. BROMWICH. You, too. Thank you. 

Ms. BORDALLO [presiding]. I thank the gentleman from Washington, and now I would like to recognize myself. I have a few 

questions for—I am sorry, I am sorry. I would like to recognize the 

gentlelady from Wyoming. 

Ms. LUMMIS. Thank you, Madam Chairman. 

Mr. Bromwich, you are the head of the Bureau of Ocean Energy. 

What experience do you have in ocean energy whether it is oil and 

gas or wave energy or wind energy? 

Mr. BROMWICH. I don’t have any experience in ocean energy. I do 

have some experience in the energy sector. I have represented a 

number of energy clients on nonocean-related matters during my 

57 

last 10 plus years of law practice, but I have no specific expertise 

on ocean energy. 

I would point out that one of the things I did as a lawyer was 

to gain expertise on matters that I previously knew nothing about, 

and did a two-year-long investigation of the Houston Police Department crime lab, which was one of the most, if not the most expensive forensic science investigations ever done. I don’t know much 

forensic science, but I recruited a crack team of forensic scientists 

who were the best in the business, and as a result of working with 

them, I learned a tremendous amount about it and put out a 

lengthy, nearly 300-page report in the summer of 2007 that has 

been widely acclaimed as one of the best examinations of a forensic 

lab ever done. 

So I don’t think that a lack of experience specifically with ocean 

energy disables me from learning about it from people who do have 

the technical expertise, and learning enough of the technical issues 

to be able to do my job appropriately. 

Ms. LUMMIS. Thank you. I now have some questions about the 

draft bill in front of me, and as Secretary Salazar said, we are dealing with a national crisis in the Gulf of Mexico, and you have 

called it an unprecedented disaster. So I am curious why this bill 

deals with changing BLM’s permitting and leasing authority. 

Director Bob Abbey of the BLM was in here and told this Committee when he testified that he did not believe it was a wise idea 

to remove leasing and permitting authority from the BLM. So I am 

curious why a draft that is intended to deal with a national crisis 

in the Gulf of Mexico includes that provision. 

I am further curious about why a bill that is supposed to deal 

with a national crisis in the Gulf of Mexico changes the requirements for issuing oil and gas on BLM and Forest Service land so 

it would require the issuance in areas where energy development 

would not conflict with other land uses. 

You know, by its very nature the multiple use concept that is 

articulated in FLMA and the National Forest Management Act 

requires a matter of resolving inevitable conflicts, so I find that 

curious. 

I also find it interesting that this bill that is supposed to be dealing with a national crisis in the Gulf of Mexico changes onshore 

lease sales from a sealed bid process to—excuse me—changes onshore lease sales to a sealed bid process, removing the ability to 

use live auction bids. Interestingly, you did away with the royaltyin-kind program, which used a sealed bid process whereas onshore 

used a live auction, and now you are taking the bid process that 

was used in royalty-in-kind and applying it to the onshore in a bill 

that is supposed to deal with the national crisis in the Gulf of Mexico. Fascinating. 

Another thing in a bill that is supposed to deal with a national 

crisis in the Gulf of Mexico changes provisions to the Federal Oil 

and Gas Royalty Simplification and Fairness Act taking out the negotiations which occurred in the 1990s between industry and the 

Federal agencies under the Clinton Administration, and at that 

time the states, which I was involved with, and takes away the 

provisions that were intended to work with industry, protecting the 

agency from having to meet deadlines, removing provisions where 

58 

industry has to meet deadlines, and all along that bill, which was 

a delicate balance between industry, the state and the Federal Government, just completely threw the states under the bus at the 

time it was enacted. 

So I am looking at this bill and saying this is supposed to deal 

with a national crisis in the Gulf of Mexico? Most of this bill has 

absolutely nothing to do with the national crisis in the Gulf of Mexico, and so I am disappointed. I would just say that we are not 

using the culmination of these hearings, which are focused on the 

national disaster in the Gulf of Mexico, to craft legislation to deal 

with the national disaster in the Gulf of Mexico. We are using this 

legislation to deal with many, many other subjects that require 

much more discussion and vetting than is going to occur within the 

national crisis in the Gulf of Mexico when that, I believe, is where 

our attention should like, and Madam Chairman, my time is up. 

Ms. BORDALLO. I thank the lady from Wyoming, and now I would 

like to recognize the gentleman from California, Mr. Costa. 

Mr. COSTA. Thank you very much, Madam Chairwoman. 

I have a couple questions kind of in the weeds and I know you 

have been there eight days so—— 

Mr. BROMWICH. Not eight full days yet. 

Mr. COSTA. Seven and a half. 

Mr. BROMWICH. Seven and a half days. 

Mr. COSTA. All right, very good. Well, we will see how we do, and 

then I would like to ask some broader general questions. 

In the technical area in this legislation, Mr. Director, Section 222 

of the ll requires bi-annual reports from the lessees to address the 

steps taken for diligent developed lease. This means that lessees 

would have to compile at least eight reports as I understand it during a lease term. If they don’t develop a lease within that term, 

they would have to relinquish the lease anyway. Do you think this 

extra paperwork is necessary, and do you suspect there is a better 

way of trying to address this for the holders of these Federal 

leases? 

Mr. BROMWICH. The answer is I don’t know whether it is necessary. I don’t know what the—— 

Mr. COSTA. Would you take a review of that—— 

Mr. BROMWICH. Sure. 

Mr. COSTA [continuing]. As you are looking at this and get back 

to us? 

Mr. BROMWICH. Absolutely. 

Mr. COSTA. Another Section 221 of the CLEAR Act requires you 

to define an establish the diligent development benchmarks for oil 

and gas leases. Again, you are not an expert in this area, you have 

already submitted that, but I think we know that finding and developing the appropriate energy sources is not a standardized process, whether we are talking about shallow or deepwater. I am wondering how your new rearranged agency is going to deal with the 

topography, the reservoir characteristics and composition of these 

resources as well as the environmental considerations, market conditions, and economic factors that would define the benchmarks. 

I mean, when you find the carbon footprint, having been out 

there, and I Chair the subcommittee, so we are going to be talking 

some more and we will see more of you, but I have also been to 

59 

the Middle East, and like there is an 8-in-10 chance you put a hole 

in the ground in Iraq, and you are going to have a significant find, 

and it is about 40 percent in the Gulf. So developing where a significant carbon find is, whether it be oil or gas, is not a slam dunk 

to say the least. So I am just wondering how this is going to work 

under Section 221. 

Mr. BROMWICH. I can’t give you a detailed answer to that. I look 

forward to working with you. 

Mr. COSTA. Would you get back to me on that as well? 

Mr. BROMWICH. Yes. 

Mr. COSTA. OK, let us talk about more like 50,000 feet up. 

Mr. BROMWICH. OK. 

Mr. COSTA. Maybe you can respond to these. 

Mr. BROMWICH. Sure. 

Mr. COSTA. Do you think that the use of shallow and deepwater—use of oil and gas in shallow and deepwater sources will 

continue to be a part of our nation’s energy portfolio in the foreseeable future? 

Mr. BROMWICH. My understanding is that it will, yes. 

Mr. COSTA. I mean, I don’t see any way out of it within the next 

10 or 12—— 

Mr. BROMWICH. I don’t think anybody does. 

Mr. COSTA. OK. So obviously you role, in part, is to ensure that 

we can do it as safely as possible. 

Mr. BROMWICH. That is exactly right. 

Mr. COSTA. Then how do you plan to use this situation as an opportunity to restore confidence by the American public that in fact 

we can do this safely? 

Mr. BROMWICH. Well, I think one of the advantages of having so 

many investigations of what went wrong with the Deepwater Horizon is that we will have a wealth of information accumulating over 

the next few months as to what the specific issues were that 

caused the blowout and caused the extraordinary and devastating 

spill that is now being dealt with. I think that once that evidence 

has been accumulated, it is analyzed, it is synthesized, that needs 

to be presented to the American people in an understandable way 

so that that can generate the confidence that the drilling that will 

continue on the future, both in shallow water and deepwater will 

be done in an environmentally safe and sound manner. 

Mr. COSTA. A technical question again. You did comment that 

when you look at the personnel available with Minerals and Management Service today to go out there and do the appropriate determination as to whether or not even the existing regulations are 

being followed as wilfully and adequate, have you taken upon yourself to begin to make an evaluation as to what you are going to 

need, the necessary personnel to— 

Mr. BROMWICH. Oh, yes, absolutely. In fact, there is a lot of good 

work that has already gone on in the Department. 

Mr. COSTA. How much are you going to need to—— 

Mr. BROMWICH. I think it is a very substantial number. The Department is still working through those numbers. 

Mr. COSTA. Have you done a comparative analysis between the 

Secretary’s proposal—again, I know you are new—for the reorganization and the proposal that we are looking at in this legislation? 

60 

Mr. BROMWICH. I don’t have that kind of comparison. 

Mr. COSTA. I would like you to be able to sit down and do that 

and get back to us, and then we may use that as a means for a 

subcommittee hearing to do that comparative analysis or at least 

have that conversation. 

Mr. BROMWICH. Very good. 

Mr. COSTA. All right. My time has expired. Thank you. 

Mr. BROMWICH. Thank you very much. 

Mr. COSTA. And we look forward to having some more conversations and I wish you good luck. 

Mr. BROMWICH. Terrific. 

Mr. COSTA. And obviously our nation’s long-term success in 

terms of all the energy tools that are in our energy toolbox depend 

upon the job that you do, so we look forward to continuing to work 

with you. 

Mr. BROMWICH. Thank you. 

Ms. BORDALLO. I thank the gentleman from California, Mr. 

Costa, and now I would like to recognize the acting Ranking Member, Mr. Gohmert from Texas. 

Mr. GOHMERT. Thank you, Madam Chair, and appreciate your 

patience, Mr. Bromwich, and obviously what is going on right now 

are votes. We have already had this hearing interrupted once with 

votes, and in that we recognize the importance of special education 

teachers, named a post office, recognized the California cities’ anniversary, and named a V.A. outpatient clinic, and right now we are 

voting on the previous question in rule. My vote won’t have an effect in those and so I preferred to stay here and finish so that you 

would not have to sit through another hour and come back. 

Mr. BROMWICH. Thank you. I appreciate it. 

Mr. GOHMERT. And I appreciate the Chair’s indulgence in doing 

that, and it is obviously pretty tough to be on the job for eight days 

and then come and get a grilling over what is going on in an event 

that people on both sides of the aisle are very upset about. 

Mr. BROMWICH. Right. 

Mr. GOHMERT. And I recognize that, and it says a lot about you, 

that you are willing to come in here and deal with that. 

Mr. BROMWICH. Thank you. 

Mr. GOHMERT. And I appreciate it. I had hoped to ask the Secretary about his comments directly. Since he had to leave, all I can 

do is comment, and get the takeaway from it. But in response to 

Mr. Markey, Secretary Salazar basically indicated his state should 

employ all the National Guard troops they need, and he was surprised the states did not move forward with deploying troops and 

doing what they need. 

Now in hearing from my former classmate here in Congress, 

Bobby Jindal, they felt so frustrated because they have had to get 

permission from people to do all the different things they are doing, 

and it seemed like—I know there was one time where they just 

moved ahead and then got permission as they were about to start 

anyway, but it sounds like since the Secretary is surprised that the 

states did not move forward with what they need, that the wonderful takeaway from the hearing today based on the Secretary’s 

statements is that Governor Jindal and other Governors just need 

to do what they need. They have full authorization to do that. They 

61 

don’t have to worry about getting government approval, and that 

way in the future they can avoid having the Secretary of the Interior be surprised that they didn’t move forward with what they 

need. They just need to go ahead and do it, and not ask permission 

from another Federal authority, not the Coast Guard, not the Interior, not FEMA, not anybody else that is being sent down there to 

stand in the way of what they need to do. They just need to do it 

and that way the Secretary won’t have to be surprised that the 

states haven’t done what they need to do. 

And I could not believe he would sit here and say that. With all 

the things that have not been done with regard to the inspections, 

and I know as you get into this I am going to be anxious to hear 

your take on what all has occurred and not occurred. Well, we had 

Director Birnbaum in here when she was still director, and I had 

asked about these offshore inspectors. 

Now, you are coming into this, and I am telling you, having 

heard the testimony, I am telling you something has got to be done. 

You have go unionized offshore inspectors, and she told us that the 

check and balance was to send a pair together. That way they can 

watch each other. They can report on what the other is doing and 

not doing, and that way they will make sure that both of them are 

really doing their job because they know the other is watching over 

their shoulder. 

When I asked her wouldn’t it have been a good idea if the last 

unionized pair that went out to the Deepwater Horizon rig had not 

been a father and son team, she indicated it was under investigation. She really couldn’t comment. I am telling you she was not 

willing to say this, but we should not have father and son teams 

going out there. That whole system has got to be changed. And if 

there are restrictions on travel or hours they can work, it has got 

to be done. 

I do want to ask, though, how long was the moratorium or maybe 

it is still going on for coal mining in West Virginia after the 29 

miners were killed? Is that still in place? 

Mr. BROMWICH. I don’t know the answer to that. 

Mr. GOHMERT. OK. Was there ever a moratorium? 

Mr. BROMWICH. I don’t know the answer to that. 

Mr. GOHMERT. Well, I can tell you there was not one, and I 

would like to know why not. If we have to have a moratorium, not 

just on the unsafe practices British Petroleum may have had and 

that may be going on on some of their rigs, because we know they 

have a dismal safety record compared to other companies, but then 

also take out their competitors with a moratorium, then why would 

there be no moratorium when 29 coal miners are killed? That 

makes no sense at all. 

And also, because of your experience and all, the Secretary said 

he believed the moratorium on drilling was correct. As you know 

from your background, it is not enough to believe something, you 

have to have evidence, and the court was shocked that there was 

not evidence; that it was clearly arbitrary and capricious based on 

the lack of evidence; and so please now that you are in place with 

your background you can help them understand you don’t do things 

based on beliefs, you do them based on evidence, and I think you 

can have a profound effect in that regard. 

62 

Mr. BROMWICH. Well, thank you. 

Mr. GOHMERT. Do you have a comment? 

Mr. BROMWICH. Just to respond briefly to one of your points. As 

you know, the Department and the Department of Justice are appealing the judge’s decision. 

Mr. GOHMERT. I know that. They announced that before they 

even read the opinion. That would have been a good idea. 

Mr. BROMWICH. Well, I am not sure that is true. 

Mr. GOHMERT. They said that. 

Mr. BROMWICH. OK. But I know they believe the judge’s decision 

was wrong and that is why they moved for a stay, and an expedited appeal to the Fifth Circuit. 

Mr. GOHMERT. Some of the worst decisions or votes in this Congress have been when people did not read the bills, and so I would 

recommend the DOJ do the same thing before they decide to appeal. 

But anyway, I would appreciate your looking into these matters. 

These are really serious matters. You are walking into a fire storm. 

I recognize that. I appreciate your willingness to do that, but we 

are going to have to get some answers, and I hope you will be able 

to get them sooner rather than later. Thank you. 

Mr. BROMWICH. Thank you very much, Congressman. 

Ms. BORDALLO. I thank the gentleman from Texas, Mr. Gohmert, 

and welcome to the hearing, Mr. Bromwich. 

Mr. BROMWICH. Thank you. 

Ms. BORDALLO. I understand you have been in the job eight days, 

and you have been to several hearings, is that correct? 

Ms. BORDALLO. That is correct. This is my third. 

Ms. BORDALLO. Well, you are a brave soul. 

Mr. BROMWICH. Thank you. 

Ms. BORDALLO. I have a few questions to ask. Last week you testified before the Senate Energy Committee that you needed to 

study the proposed reorganization so you could make a recommendation about it. Now, does this mean that splitting up MMS 

into three agencies, as you announced in the secretarial order, is 

that not set in stone? Do you believe this is a good thing? 

Mr. BROMWICH. Thank you very much for your question. When 

I was asked to take this job, I was informed that there was a proposal that had already been made to divide the then existing MMS 

into three different pieces. Secretary Salazar said he thought it was 

fair and appropriate that I have the ability to understand the reorganization proposal and make any modifications that I thought 

were appropriate based on my learning more about it and getting 

comfortable with it. 

Although this is my third hearing and there have been a lot of 

other things I needed to do, I have had further conversations both 

with the Secretary and with people who have spent a good amount 

of time dealing with this issue, studying the issue, dealing with 

employees in my organization to get their views on things, and I 

am far more comfortable today on day eight than I was on day one 

that that is the right path forward. 

Ms. BORDALLO. So you are looking to the three-way split? 

Mr. BROMWICH. Based on what I know, that makes quite a bit 

of sense. 

63 

Ms. BORDALLO. Thank you. And Mr. Bromwich, I understand 

that there are some additional subsea tests that are being conducted on the blowout preventers being used on the relief wells, 

and that such testing was previously thought to not be possible. 

Would you describe in more detail what type of tests are being run? 

Mr. BROMWICH. I wish I could but I can’t. I don’t know the specifics of what kind of subsea tests are currently being conducted. 

Ms. BORDALLO. All right. 

Mr. BROMWICH. As I said before, there are multiple investigations ongoing. I have not had time, frankly, to find out where the 

different investigations are. There is one that is jointly being conducted by my agency and the Coast Guard. The next set of public 

hearings are scheduled for the week of July 19. I plan to go down 

there for at least part of that, as part of the process, in which I 

learn more about the specific issues that are being explored in that 

investigation. 

Ms. BORDALLO. That is fair enough. Thank you. 

And my last question, do you believe that a training academy for 

inspector such as is proposed in Mr. Rahall’s draft would be a good 

idea? And do you think there would be any efficiencies in having 

a combined onshore and offshore inspection force? 

Mr. BROMWICH. It is a very intriguing idea. One of the things 

that I have already begun to focus on is how we get an experienced, 

competent, capable cohort of inspectors, not father and son teams, 

but teams of inspectors who know what they are doing, that gain 

experience in what they are doing, and yet don’t suffer from the 

kind of coziness with industry that my agency has been so criticized for. 

So, we are exploring that. One of the things I want to explore 

is a program to recruit talented petroleum engineering students 

straight out of school, pair them with senior inspectors, the best 

that I have got, and bring them along a whole new generation of 

inspectors who are devoted to public service, and are not looking 

around the corner for a job with industry two or four or six years 

down the road. 

I think we have to find a way to establish the independence—— 

Ms. BORDALLO. Absolutely. 

Mr. BROMWICH [continuing]. Of the inspectors, and make sure 

that their commitment is to the public interest to the safety, to the 

protection of the environment, and that they are not looking 

around the corner at the oil company that is going to pay their salary three years down the road. 

Ms. BORDALLO. Thank you. Thank you very much. I would like 

to thank you, and be sure you thank the Secretary, Mr. Salazar. 

I know he had to leave. And thank you for your time today. Yes? 

The Ranking Member, go ahead. 

Mr. GOHMERT. I would just like to make a request or an answer 

in writing. Our time on the hearing is about to conclude. But we 

had had a hearing in here a year or so ago where Inspector General Devaney had investigated the 1998-1999 offshore leases from 

which the price adjustment language, which was intentionally 

pulled—— 

Mr. BROMWICH. The which language? I am sorry. 

64 

Mr. GOHMERT. The price adjustment language dealing with the 

price of oil was pulled for those two years, and he had indicated 

in here, because obviously when something happens that costs us 

hundreds of millions or billions of dollars to the Treasury, I don’t 

care what party anybody is in, we ought to want to get to the bottom of it, and anyway he had indicated that there were at least two 

or three people that he had not interviewed because they had left 

government service. One person that was not interviewed apparently was even involved in signing the notices for these leases and 

whatnot, and it turned out she went to work for British Petroleum 

for eight years, and came off that employment last June when the 

press release from Secretary Salazar indicates she went back to 

work for Minerals Management. 

I am not sure in the breakup where Sylvia Baca will be working, 

but I think it would be interesting to know if her responsibilities 

involve anything at all, and now that she is back in government 

service, if the IG’s office would be alerted that somebody they may 

not have interviewed before about what costs this country so much 

money might be interviewed by the IG now to determine more answers than we were able to get, or that the IG was able to get previously. So just to find out where all that sits, has the IG been 

alerted that she is back, and so we can find out what job she had, 

does it involve BP and that kind of things. But I appreciate it. 

Mr. BROMWICH. My understanding, Congressman, is that she is 

recused from any and all BP matters. 

Mr. GOHMERT. Yes, we were told that previously, but what one 

person thinks is any and all matters may not be to all appropriateness to somebody else. 

Mr. BROMWICH. Fair enough. 

Mr. GOHMERT. But I have heard recused from matters before 

that might be a conflict, and I would really like to know exactly 

what those are. Thank you. 

Mr. BROMWICH. Thank you. 

Ms. BORDALLO. I thank the gentleman. Also, Director Bromwich, 

you were asked many questions today which you were not able to 

answer so I am sure that you will be able to supply the Committee 

with the answers to these questions, and the record of this hearing 

will be held open for 10 days. Is that correct? Yes. 

The Committee will now recess until the end of these votes, I 

think there are three votes down on the Floor, we are going into 

the second one, so it will probably be about 15 minutes before we 

introduce the second panel. And I thank you again, Director 

Bromwich, for being with us this morning. 

Mr. BROMWICH. Thank you very much. 

Ms. BORDALLO. And now the Committee stands in recess. 

[Recess.] 

Ms. BORDALLO. The Full Committee of the Natural Resources 

will now come to order, and we welcome the second panel of witnesses. I would like to welcome Ms. Janis Searles Jones, Vice 

President for National Conservation Policy and Legal Affairs, 

Ocean Conservancy; and Dr. David E. Dismukes, Ph.D., Associate 

Executive Director and Director of Policy Analysis, Center for 

Energy Studies, Louisiana State University. 

I welcome you both, and we will begin with you, Ms. Jones. 

65 

STATEMENT OF JANIS SEARLES JONES, VICE PRESIDENT FOR 

NATIONAL CONSERVATION POLICY AND LEGAL AFFAIRS, 

OCEAN CONSERVANCY 

Ms. JONES. Thank you, Congressman Bordallo. 

Chairman Rahall, Ranking Member Hastings, and distinguished 

members of the Committee, thank you for the invitation to participate in today’s hearing. My name is Janis Jones. I am the Vice 

President of Programs for Ocean Conservancy, a national conservation organization that has promoted healthy and diverse ocean ecosystems since 1972. I have worked on marine issues for almost 15 

years and I serve as an adjunct faculty member of the Northwestern School of Lewis and Clark, Northwestern School of Law at 

Lewis and Clark College. 

The oil spill in the Gulf of Mexico is a human and environmental 

tragedy. Lives have been lost, livelihoods have been destroyed, and 

the region is being subjected to what the President has called the 

worst environmental disaster America has ever faced. We may 

never be able to calculate the full economic and ecological impact 

of the BP Deepwater Horizon spill. We do know that in the Gulf 

region alone fishing and coastal tourism provide $14.5 billion annually in wages and income impacts, and support over 820,000 jobs, 

and we know that our current OCS policy has been both an economic and environmental failure. 

As this Committee recognized long before the current tragedy, 

there is an urgent need for reform of our Outer Continental Shelf 

regime, and the time for action is now. The Discussion Draft under 

consideration today represents a significant step forward. The 

CLEAR Act addresses five key challenges facing our nation. 

First, our national policy for the OCS is inadequate and we lack 

meaningful standards to protect the environment and ocean and 

coastal economies. 

The amendments contained in the Discussion Draft would begin 

to balance an OCS policy that is focused far too much on oil and 

gas development and far too little on the consequences of such development. The standard against which we must measure decisions 

about whether, and if so under what conditions, to permit OCS development must be one that protects the heath of marine ecosystems. We believe the Discussion Draft should be improved to reflect that standard. 

Second, the process for planning and implementing OCS oil and 

gas activities is badly broken. 

The amendments contained in the Discussion Draft would begin 

to address the process that has been implemented to shield full and 

fair consideration of the risks and consequences of OCS development. OCS planning, exploration, and development must be subjected to meaningful environmental analysis which requires baseline information, appropriate geographic scales of analysis, and 

must involve expert agencies other than the MMS or it successors. 

The Discussion Draft take some great strides in that direction, 

such as requiring consultation with NOAA, but could be further 

strengthened. 

Third, at the BP Deepwater Horizon continues to painfully demonstrate, there are insufficient standards for oil spill prevention 

and response. 

66 

The Discussion Draft proposes significant improvements, including more rigorous safety and technology standards and more robust 

spill response plans. We support the amendments and suggest further strengthening the provisions by requiring consideration of the 

availability of oil spill response infrastructure at the five-year plan 

level, and by conditioning the issuance of exploration permits on a 

real world demonstration of response capability. 

Fourth, despite the importance of coastal and marine ecosystems 

and the risks posed by oil and gas activities, there is no dedicated 

funding for ocean, coastal and Great Lakes conservation and management. 

The Discussion Draft’s creation of a new Ocean Resources, Conservation and Assistance Fund is an action that is long overdue 

and one that we strongly support. 

Finally, as every commission that has examined ocean policy 

since the late sixties has concluded, a single sector approach to 

ocean governance is fundamentally flawed and has led to conflicts 

among users and the degradation of marine ecosystems. The 

exiting oil and gas planning process is a stark example of why we 

must move to a system of multi-objective regional planning for the 

conservation and management of marine resources. 

The Discussion Draft moves in the right direction and should be 

broadened to address multiple objectives, not juts energy activities. 

Offshore drilling for oil and gas, to the extent it is to consider 

in the wake of the disaster in the Gulf, must be considered only 

as a bridge to a clean energy future. It cannot continue under a 

system that fails to protect the ocean and coastal economies and 

ecosystems upon which we all rely. The need for reform is urgent. 

I thank the Committee for seeking to address that need, and for 

the opportunity to testify. 

[The prepared statement of Ms. Jones follows:] 

Statement of Janis Jones, Vice President of Programs, Ocean Conservancy 

Chairman Rahall, Ranking Member Hastings and Members of the Committee, 

thank you for the invitation to participate in today’s hearing. My name is Janis 

Jones and I am the Vice President of Programs for Ocean Conservancy, a national 

marine conservation organization that has promoted healthy and diverse ocean ecosystems since its founding in 1972. I have worked on marine issues for almost fifteen years, and I serve as an adjunct faculty member of the Northwestern School 

of Law at Lewis and Clark College in Portland, Oregon. 

What we are currently witnessing in the Gulf is a human and environmental tragedy. Even as the disaster continues to unfold, many of its underlying causes are 

clear: regulators who uncritically accepted the assurances of the oil industry regarding the safety of offshore drilling, inadequate safety and environmental standards, 

and a false notion that the risk of an accident of this magnitude was so insignificant 

that it was unworthy of evaluation. It is noteworthy, Mr. Chairman, that this Committee had identified many of the systemic failures that enabled such practices to 

occur during hearings last year, and that the Consolidated Land, Energy, and 

Aquatic Resources (CLEAR) Act was introduced before the current tragedy in the 

Gulf began. I would like to thank the Committee for its work to revise that legislation in recent weeks, and for releasing the Discussion Draft under consideration 

today. 

Continued offshore drilling must be considered only as a bridge to a clean energy 

future; and it cannot continue under a system that fails to protect adequately the 

coastal and ocean ecosystems—including living coastal and marine resources and 

habitat—on which we all rely. The law governing oil and gas activities in the Outer 

Continental Shelf (OCS) lacks provisions that protect ocean and coastal environments and the economies that depend on them; it largely excludes expert agencies 

from the development process; and it lacks integrated planning to consider and adVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00070 Fmt 6633 Sfmt 6621 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
67 

dress conflicts and maximize resource protection and sustainable production. The 

federal agency charged with administering OCS oil and gas activities has proved incapable of effective regulation and oversight, and our ability to prepare for, respond 

to, and clean up oil spills has not kept pace with advances in drilling and extraction 

technologies. The Discussion Draft takes important steps to correct these shortcomings. 

Overall we view this Discussion Draft as a very positive step forward in addressing an urgent set of problems. My testimony focuses mainly on the provisions that 

affect ocean and coastal ecosystems. The first section of my testimony identifies key 

weaknesses or gaps in current ocean and energy policy that Congress should address as it moves forward with energy reform legislation. The second section highlights provisions in the proposed legislation that Ocean Conservancy supports as 

constructively addressing those weaknesses or gaps. The third section discusses provisions of the Discussion Draft that we believe should be strengthened. 

I. WEAKNESSES OR GAPS IN CURRENT OCEAN AND ENERGY POLICY: 

PRIORITIES FOR CHANGE 

For purposes of this testimony, key shortcomings in ocean and energy policy can 

be grouped into five categories: (1) an inadequate national policy for the OCS and 

a lack of substantive standards to protect the environment and ocean and coastal 

economies; (2) flawed processes for planning and implementing OCS oil and gas activities; (3) insufficient standards for oil spill prevention and response; (4) a lack of 

dedicated funding for ocean, coastal, and Great Lakes conservation and management; and (5) a failure to integrate oil and gas activities with other ocean planning 

and management decisions. The following paragraphs briefly describe these problems and suggest solutions. 

First, our national OCS policy focuses too much on development and extraction 

of oil and gas, and not enough on the consequences of doing so. Congress should 

amend the policy to recognize that oil and gas activities on the OCS are appropriate 

only in those areas where it can be demonstrated that oil and gas activities can proceed with minimal risk to the health of ocean ecosystems. In addition to policy 

shortcomings, the OCS Lands Act (OCSLA) does not contain meaningful, substantive standards to ensure protection of the marine environment. The statute 

should be amended to prioritize protection and maintenance of healthy marine and 

coastal ecosystems. Congress should ensure that baseline science is in place before 

OCS areas are leased, important ecological areas are placed off-limits to leasing and 

drilling, and facilities use the best available technologies and safety procedures to 

maximize the protection of workers, ocean and coastal ecosystems and the coastal 

businesses and economies that rely on them. 

Second, the existing process for making decisions about and managing oil and gas 

activities on the OCS does not do enough to empower governmental agencies with 

the greatest expertise in ocean issues. OCSLA gives the Secretary too much discretion to permit oil and gas activities where they do not belong and risks substantial 

harm to ocean and coastal ecosystems. This process should be changed to give expert agencies—such as the National Oceanic and Atmospheric Administration 

(NOAA), the U.S. Fish and Wildlife Service (USFWS), the U.S. Coast Guard 

(USCG), and others—a greater role in decisions about, and preparation of environmental analyses for, OCS oil and gas activities. Further, planning and leasing decisions involve such broad areas of the ocean that there is little opportunity for meaningful environmental analysis or public participation before exploration and drilling 

activities proceed. OCS planning areas should be smaller and precisely focused only 

on specific lease tracts to facilitate more meaningful review. 

Third, as the aftermath of the BP Deepwater Horizon continues to demonstrate 

painfully, current standards for oil spill prevention and response are inadequate. 

Congress should change federal law to require more rigorous safety and technology 

standards and more robust spill response plans. For example, OCS operators should 

be required to plan for worst-case spills, including impacts from and response to 

blowouts. OCS drilling safety equipment should be certified by an independent 

third-party, should use the best available technology, and should incorporate redundant blowout prevention systems. To be effective in an emergency, sufficient response capability must be on site and able to be mobilized immediately, and a demonstration of that capability must be made before activity commences. 

Fourth, despite the importance of coastal and marine ecosystems and the risks 

posed by oil and gas activities, there is no dedicated source of funding to support 

conservation and management in these regions. Congress should invest revenues derived from offshore development in a fund dedicated to ocean and coastal restoration 

and conservation. 

68 

1This Section includes provisions that Ocean Conservancy feels are particularly important or 

noteworthy. If a particular provision is not listed in this Section, it does not indicate that Ocean 

Conservancy does not support the provision. 

Fifth, decision-making about oil and gas activities on the OCS is largely disconnected from other ocean planning and management decisions. This single-sector approach contributes significantly to conflicts among users and the degradation of marine ecosystems. Congress should move to a system that relies upon multi-objective 

regional planning for the conservation and management of marine resources. 

The Discussion Draft contains various provisions that address, or begin to address, many of these problems. Below, Section II highlights critical provisions that 

make positive changes and should be retained as the CLEAR Act moves forward in 

the legislative process. Section III discusses provisions that should be strengthened 

or added to the CLEAR Act to ensure effective and comprehensive reform. 

II. PROVISIONS OF THE CLEAR ACT THAT IMPROVE OCEAN AND 

ENERGY POLICIES 

The following paragraphs highlight selected provisions of the Discussion Draft 

that are particularly important and should be carried forward. 1 In some instances, 

this testimony recommends changes to these provisions, detailed in Section III, that 

are intended to further strengthen or clarify the current proposed legislative language. 

A. Title I: New Department of the Interior Agencies 

Until recent restructuring within the Department of Interior (DOI), DOI’s Minerals Management Service (MMS) was responsible for the administration of oil and 

gas activities on the OCS, including evaluation, planning, regulation, and collection 

of revenue generated through lease sales and royalties. The Deepwater Horizon disaster brought to the public’s attention the potential conflicts between the agency’s 

revenue-generating, planning, and environmental and safety enforcement functions. 

Additionally, reports and investigations by the U.S. Government Accountability Office (GAO) and DOI’s Office of Inspector General (OIG) have revealed a troubling 

history of MMS’s failure to effectively track, collect, audit, and enforce royalty and 

other payments due from industry. And in recent years, reports have revealed an 

inappropriately close relationship between MMS employees and industry members, 

instances of unlawful behavior, and an MMS culture of disregard for ethical and 

substantive duties. 

For all of the above reasons, we support the CLEAR Act’s abolishment of MMS, 

creation of three separate DOI agencies, and other statutory changes. The following 

provisions are particularly important: 

• the abolishment of MMS (Section 107) and the creation of separate agencies— 

the Bureau of Energy and Resource Management (Section 101), the Bureau of 

Safety and Environmental Enforcement (Section 102), and the Office of Natural 

Resources Revenue (Section 103)—to carry out MMS’s functions and duties; 

• with some changes noted below, the requirement that the Secretary of the Interior create an independent office within the Bureau of Energy and Resource 

Management to carry out environmental studies and to conduct environmental 

analyses (Section 101(c)(3)); 

• the requirement that the Secretary of the Interior certify annually that certain 

Bureau of Energy and Resource Management, Bureau of Safety and Environmental Enforcement, and Office of Natural Resources Revenue officers and employees are in compliance with ethics laws and regulations (Section 104), and 

the requirement that Bureau of Safety and Environmental Enforcement inspectors are qualified, trained, and meet the highest ethical standards (Section 

102(e)); 

• with some changes noted below, the creation of an independent audit and oversight program to monitor administration of the revenue program (Section 

103(d)); and 

• with some changes noted below, the creation of an OCS Safety and Environmental Advisory Board to provide independent scientific and technical advice to 

the Secretary of the Interior and the Directors of the Bureau Energy and Resource Management and the Director of the Bureau of Safety and Environmental Enforcement (Section 109). 

B. Title II: OCSLA Reform 

As noted above, OCSLA sets forth an inadequate and outdated national OCS policy and lacks meaningful environmental and safety standards. Title II of the Discussion Draft makes many important and positive changes to OCSLA. While these 

69 

changes will require additional modification to be most effective—see Section III, 

below—Title II makes great strides in improving OCSLA. Among the most important provisions are amendments that, among other things: 

• remedy flaws in the national OCS policy (Section 203); 

• require the Secretary of the Interior to promulgate new, more protective regulations and in so doing, to consider the views of the Secretary of Commerce on 

matters that may affect the marine and coastal environment (Section 205); 

• change the leasing provisions of OCSLA to disqualify parties not in compliance 

with certain safety or environmental requirements from bidding on OCS leases 

and require the Secretary of the Interior to consult with the Secretary of Commerce before holding an OCS lease sale (Section 206); 

• direct a portion of OCS revenue into a new Ocean Resources Conservation and 

Assistance (ORCA) fund (Section 207); 

• eliminate the use of categorical exclusions to approve exploration plans, extend 

the deadline for approving exploration plans, impose more robust requirement 

for drilling plans, provide for consultation with the Secretary of Commerce before approving exploration permits, and set forth more protective standards for 

drilling (Section 208); 

• require the Secretary of the Interior to adhere to more protective substantive 

standards when developing five-year oil and gas leasing programs—including 

requirements to minimize environmental damage and consider three consecutive years of science—and to invite and consider comments from the Secretary 

of Commerce during the formulation of the plan (Section 209); 

• direct the Secretary of the Interior to cooperate with the Secretary of Commerce 

to conduct studies of areas of the OCS open to leasing (Section 210); 

• require more rigorous and more frequent inspections of drill rigs (Section 212); 

and 

• require Development and Production Plans (DPP) for facilities in the Gulf of 

Mexico, provide for more robust DPPs, and prohibit the use of categorical exclusions for approving DPPs (Section 214); 

C. Title VI: OCS Coordination and Planning 

In addition to amending specific statutes like OCSLA to provide greater protection 

for ocean and coastal resources, we must also reform our overall approach to siting 

marine uses and managing our ocean. We need management approaches that integrate across federal and state jurisdictions and consider more holistically ecosystem 

services and the different uses that our oceans provide. The CLEAR Act begins to 

move in this direction with the changes in Title VI. As outlined in section III below, 

we recommend further strengthen this Title to truly provide for multi-objective 

planning; however, we support many of the concepts addressed in Title VI, including: 

• increased coordination between state and federal agencies on decisions affecting 

ocean resources; 

• comprehensive regional assessments of ocean ecosystems including important 

ecological areas, habitats, and species, as well as current and potential uses; 

and 

• regional planning to proactively and transparently consider the tradeoffs made 

in allowing for ocean uses, while providing for the protection of marine ecosystem health. 

In addition, we strongly support Section 605, which creates an Ocean Resources 

Conservation and Assistance (ORCA) fund. If oil companies are going to continue 

to make billions of dollars from activities that put ocean and coastal resources at 

risk, a portion of the revenue from those activities should be made permanently 

available for efforts to protect, maintain, and restore the health of ocean and coastal 

ecosystems. Coastal state and tribal governments play an important role in managing and protecting ocean and coastal resources. We support allocating a percentage of the ORCA funds to those governments, provided there is not a connection between the amount of funding received and proximity to oil and gas activities. The 

CLEAR Act avoids such a connection, thereby reducing the risk of providing further 

incentives for offshore drilling. 

D. Title VII: Miscellaneous Provisions 

Title VII of the Discussion Draft includes several important sections that should 

be carried forward. We particularly support the following Sections: 

• Section 701, including its provisions to repeal incentives and royalty relief for 

deepwater drilling in the Gulf of Mexico and to repeal certain development and 

production incentives in Planning Areas offshore Alaska; 

70 

• Section 704, which precludes the Secretary of Commerce, the Administrator of 

NOAA, or Regional Fishery Management Councils from developing or approving 

fishery management plans or amendments that permit or regulate offshore 

aquaculture, and which invalidates any permit issued pursuant to this authority to conduct offshore aquaculture. We recommend adding language to clarifying that DOI also lacks authority to regulate offshore aquaculture, given 

MMS’s previous interest in this issue. Because the Magnuson Stevens Fishery 

Conservation and Management Act does not provide the Secretary of Commerce 

with the authority to regulate offshore aquaculture, we support H.R. 4363, 

which establishes a national regulatory framework developed specifically to address the unique environmental concerns associated with offshore aquaculture; • Section 705, which prevents exploration, development, or production of minerals 

of the Outer Continental Shelf in areas seaward or adjacent to areas where a 

state moratorium is in effect; • Section 707, which would provide new authority for states to develop and revise 

plans for improved oil spill response under authorities of the Coastal Zone Management Act; and • Section 708, which requires the President to promote collaboration among federal agencies with ocean and coastal related functions; support Regional Ocean 

Partnerships; and establish a National Ocean Council. 

E. Title VIII: Gulf of Mexico Restoration 

The Deepwater Horizon blowout and spill is a human and environmental tragedy. 

Coastal communities in the Gulf of Mexico—and coastal and marine ecosystems— 

are suffering and will continue to feel the effects of the spill for years to come. Effective restoration efforts will require the cooperation of and coordination among many 

federal, state, local and private interests over a sustained period. We support the 

effort to facilitate and coordinate restoration activities, including establishing a Gulf 

of Mexico Restoration Planning Program, establishing a long-term monitoring and 

research program in the region, and establishing a migratory species emergency 

habitat restoration and establishment program for the Gulf coast. As noted in Section III, below, the Committee should clarify how the provisions of Title VIII of the 

CLEAR Act will relate to processes mandated under existing law. 

III. PROVISIONS THAT SHOULD BE STRENGTHENED OR ADDED TO 

THE CLEAR ACT TO ENSURE EFFECTIVE AND COMPREHENSIVE 

REFORM 

While the CLEAR Act would enact many significant amendments, the Committee 

should consider clarifying or strengthening some portions of the draft bill to ensure 

that reforms are substantive and meaningful. The following section describes, in a 

general fashion, recommended changes to the Discussion Draft. We would welcome 

the opportunity to provide to the Committee specific legislative language, in the 

form of recommended line edits, for Title II, Subtitle A and Title VI of the Discussion Draft. 

A. Title I: New Department of the Interior Agencies 

Section 101(c)(3) of the Discussion Draft requires the Secretary of the Interior to 

create an independent office within the Bureau of Energy and Resource Management that would carry out environmental studies required under Section 20 of 

OCSLA and conduct environmental analyses for programs administered by the Bureau. The Discussion Draft requires this independent office, in carrying out its 

‘‘studies,’’ to consult with relevant federal agencies including the Bureau of Safety 

and Environmental Enforcement, the USFWS, the U.S. Geological Survey (USGS), 

and NOAA. The bill should be amended to clarify that the independent office is required to consult with these other agencies not only with respect to environmental 

studies pursuant to OCSLA section 20, but also with respect to the environmental 

analyses noted in Section 101(c)(3)(A)(iii)(II). In addition, the list of federal agencies 

with which the office shall consult should be expanded to include the Environmental 

Protection Agency (EPA) and the USCG. 

Title I also requires the Secretary to create an audit and oversight program within the Office of Natural Resource Revenue, charged with overseeing the activities 

of the Office of Natural Resource Revenue (Section 103(d)). This auditing program 

may not be—or may not be perceived as—truly independent if it resides within the 

Office it is charged with overseeing. The Committee should change the Discussion 

Draft such that the independent auditing program is located in an office outside the 

Office of Natural Resource Revenue, for example in the Office of Inspector General. 

Section 109 requires the establishment of an OCS Safety and Environmental Advisory Board, but provides little direction as to who may serve on the Board. Under 

the bill as drafted, it is possible that the Board could be dominated by members who 

71 

are part of, or have close ties to, the oil and gas industry. The bill should limit to 

the number of Board members who currently work for, or have in the recent past 

worked for, the oil and gas industry. 

B. Title II: OCSLA Reform 

The paragraphs below describe many recommended changes to Title II of the 

Clear Act and/or additional amendments to OCSLA, but do not set forth every recommended edit. 

Section 203 

Section 203 of the Discussion Draft does much to remedy flaws in the national 

OCS policy. However, the Committee should make additional changes to ensure that 

the policy is mandatory and consistent with the substantive protections included in 

the Act. For example, Section 203 of the bill should be revised to provide that the 

OCS ‘‘shall’’ be managed in a manner that ‘‘minimizes’’—not just ‘‘recognizes’’—the 

potential impacts of development. In amending OCSLA Section 2, paragraph 6, the 

bill should provide that ‘‘exploration, development, and production of energy and 

minerals on the outer Continental Shelf shall be allowed only when those activities 

can be accomplished in a manner that does not endanger life....’’ These additional 

changes will establish a strong and consistent policy. 

Section 205 

Section 205(a)(1) amends OCSLA to require the Secretary of the Interior to promulgate rules and regulations, but only when the Secretary determines those rules 

are ‘‘necessary and proper.’’ This section should eliminate Secretarial discretion by 

striking the words ‘‘as he determines to be necessary and proper.’’ With respect to 

OCSLA’s language on lease cancellation, the draft bill should change the current 

standard in OCSLA Section 5(a)(2)(A)(i)—that continued activity ‘‘would probably 

cause serious harm’’—to ‘‘could cause serious harm.’’ The draft bill should amend 

current OCSLA Section 5(a)(8) to require regulatory provisions for the compliance 

with not only the Clean Air Act, but the Marine Mammal Protection Act (MMPA), 

the Endangered Species Act (ESA), the Clean Water Act (CWA), and the National 

Environmental Policy Act (NEPA). And in addition to requesting and giving ‘‘due 

consideration to the views of the Secretary of Commerce,’’ the Section 205 should 

also require the Secretary of the Interior to request and give due consideration to 

USFWS, EPA, and the USCG. 

Section 206 

Section 206 of the CLEAR Act should include additional amendments to strengthen and clarify OCS leasing provisions. For example, it should amend Section 8(b)(4) 

to clarify that the rights of OCS lessees are conditional: they entitle the lessee to 

an exclusive right ‘‘to seek authorization to’’ explore, develop, and produce. Section 

206 should require the Secretary of the Interior to request from the Secretary of 

Commerce a review of proposed lease sale environmental impact statements, not 

just a review of the lease sale itself. Also, the Secretary of Commerce should have 

more time to conduct this review, and Secretary of the Interior should be required 

to modify the proposed lease sale as recommended by the Secretary of Commerce’s 

review. Section 206 should also be amended to include a new substantive standard 

to ensure that OCS leasing does not endanger marine life. 

Section 208 

This Section of the Discussion Draft makes significant improvements to OCSLA 

Section 11, but should go further to improve OCSLA’s provisions relating to exploration. To begin, the bill should make additional amendments to subsection (a) of 

OCSLA Section 11 to prohibit duplicative geological or geophysical survey efforts in 

the same area of the OCS and to ensure the use of the best available technologies 

and practices to minimize impacts to aquatic life. As written, the Discussion Draft 

requires the Secretary to approve an exploration plan if, among other things, an operator meets a strict new spill response standard. This should be changed to require 

the Secretary to approve an exploration plan ‘‘only’’ if the operator meets the new 

response standard. OCSLA Section11(g) should be further amended such that the 

Secretary of the Interior is not only required to consult with the Secretary of Commerce, but also with other relevant natural resource and environmental agencies, 

including USFWS and EPA. The best available technology standard and technical 

systems analysis required by the proposed new OCSLA Section 11(j) should apply 

to OCS exploration plans that contain proposals to drill a well in frontier areas as 

72 

well as exploration plans that proposed to drill a well in deepwater areas. Finally, 

the language concerning disapproval of an exploration plan—the proposed new 

OCSLA Section 11(k)—sets too high a standard and should be modified. 

Section 209 

OCSLA Section 18 requires the Secretary of the Interior to prepare a five-year 

oil and gas leasing program. The Discussion Draft makes important changes to this 

section, but should further modify provisions concerning the five-year leasing program to ensure they include substantive protective standards. For example, the bill 

should provide a standard to ensure that only specific, limited areas are made available for leasing so that the leasing schedule is focuses on relevant areas of the OCS. 

It should also include a provision that requires the Secretary of the Interior to conform the five-year program to relevant marine spatial plans. It should exclude important ecological areas from the five-year leasing program. The bill should also require the Secretary of the Interior to consider, when preparing five-year leasing programs, the availability of infrastructure to support oil spill response. In addition to 

requiring the Secretary of the Interior to invite and consider suggestions from 

NOAA, the bill should require the Secretary to invite and consider suggestions from 

other natural resource and environmental agencies, including USFWS and EPA. 

Section 210 

Section 210 should further amend OCSLA Section 20 to require at least three 

years of baseline environmental data must be gathered before energy or mineral exploration or development activities are permitted. Baseline data should include (1) 

weather, water, wind, ocean chemistry, and other environmental data; (2) wildlife 

assessments, including but not limited to fish, birds, invertebrates, and marine 

mammals; and (3) data on the benthic environment. 

Section 211 

Section 211 strengthens the ‘‘best available and safest technologies’’ standard in 

OCSLA, but it does not go far enough; there are still exceptions and qualifiers that 

could reduce significantly the impact of this requirement. The bill should further 

amend OCSLA Section 21 to remove the exceptions and qualifiers and simply require OCS facilities to use the best available and safest technologies. Section 211 

also requires the Secretary of the Interior to identify and publish a list of the best 

available technologies. The bill should require the Secretary to enter into an agreement with the National Academy of Engineering for periodic written review of the 

list, to make the written review public, and to report to Congress any disagreement 

with any findings or recommendations made in the review. 

C. Title VI: OCS Coordination and Planning 

As noted above, we support many of the concepts in Title VI related to regional 

coordination and planning. Our oceans urgently need a more integrated system with 

ecosystem based management at its core, as called for by both the Pew Ocean Commission and the U.S. Commission on Ocean Policy, and as advanced by the recent 

work of the President’s Interagency Ocean Policy Task Force. As currently drafted, 

Title VI would make important advances in coordination and planning, but would 

also risk creating another single-sector approach to ocean management. We suggest 

broadening the objectives of Section 602 and 603 to address multiple objectives, of 

which energy planning would be one. Moreover, in order to provide for the ‘‘longterm economic and environmental benefit of the United States,’’ the protection, 

maintenance, and restoration of marine ecosystem health, must be prioritized within the overall purpose statement. 

Regional Assessments required by Section 603 will be critical in providing the 

science and data necessary for any multi-objective regional planning. As such, the 

bill should be amended to include additional requirements for robust environmental 

baseline data, as well as assessments of existing and emerging threats to marine 

ecosystem health, impacts of drilling, and effectiveness of clean-up technologies. It 

should also require identification and prioritization of additional science needs. 

Given the ocean science expertise within NOAA, these assessments should be conducted jointly by the Secretary of the Interior and the Secretary of Commerce. 

In addition, we support finalization of the President’s Interagency Ocean Policy 

Task Force work to establish a National Ocean Policy and Framework for Coastal 

and Marine Spatial Planning. The draft policy and framework have benefitted from 

significant agency, stakeholder, and public input. We suggest modifying Title VI to 

align with the proposed structures to avoid potentially overlapping and duplicative 

73 

planning processes. Our suggestions include modification of the geographic scope for 

assessments, plans, and regional bodies, and establishment of regional bodies by the 

President in consultation with the National Ocean Council, established in Section 

708. 

Section 605 creates the ORCA fund to be administered by the Secretary of Commerce for the conservation, protection, maintenance, and restoration of ocean, coastal and Great Lakes ecosystems. Thirty-five percent of the funding would be made 

available through a competitive grants program. To enhance federal agency communication and coordination we suggest that the National Ocean Council, established 

in section 708, approve the final selection of the Ocean, Coastal, and Great Lakes 

competitive grant proposals, based on the recommendations of the Secretary of Commerce. With this approval process, review by a statutorily mandated Review Panel, 

as provided for in Section 605(c)(2), is unnecessary. Instead, Congress should direct 

the Secretary of Commerce to establish procedures and criteria for evaluating grant 

proposals that include appropriate broad, interdisciplinary review. 

Under Section 605, Regional Ocean Partnerships would be eligible for ten percent 

of the ORCA funding. We suggest modifications to the definition of Regional Ocean 

Partnership in Section 3 in order to ensure that the regional bodies established pursuant to Section 602 are also eligible for this funding. 

D. Title VII: Miscellaneous Provisions 

Section 702 requires the Secretary of the Interior to issue regulations establishing 

a ‘‘production incentive fee’’ on oil or gas wells producing in commercial quantities. 

The fee is set at $2 per barrel of oil and 20 cents per million BTU of natural gas. 

The draft bill should clarify whether the monies collected pursuant to this section 

will be deposited into the General Treasury or used for some specific purpose. 

Section 710 provides that funds made available pursuant to the CLEAR Act cannot be used to fund or carry out activities for which a responsible party (as defined 

by the Oil Pollution Act (OPA)) is liable. This section should be modified to allow 

CLEAR Act funds to be used, but to require that responsible parties remain liable 

and must reimburse any expenditures. 

E. Title VIII: Gulf of Mexico Restoration 

Sections 801 and 802 establish a Gulf of Mexico Restoration Program and a Gulf 

of Mexico Long-Term Environmental Monitoring and Research Program. The activities to be undertaken pursuant to these programs appear to overlap significantly 

with processes that OPA requires federal and state natural resources trustees to undertake. For example, Section 801(c), which calls for a restoration plan, appears to 

overlap significantly with OPA’s requirement that trustees develop and implement 

‘‘a plan for the restoration...of the natural resources under their trusteeship.’’ 33 

USC. § 2706(b). 

The Committee should clarify the relationship between the requirements of Title 

VIII and the requirements of OPA, including OPA regulations and NOAA Natural 

Resource Damages Assessment (NRDA) guidance. If the Restoration Plan and/or 

Monitoring and Research Program requirements set forth in Sections 801 and 802 

are intended to establish or replace requirements for a NRDA process, the draft 

should make that clear, and should provide more detailed legislative language. Sections 801 and 802 should also provide for more opportunities for public participation 

in the Restoration and Monitoring programs. 

Section 801(d)(2)’s definition of restoration programs and projects should be 

changed to add the word ‘‘enhancement’’ after the word ‘‘replacement.’’ In Section 

802(b), the bill should be amended to require that the research and monitoring program address not only physical, chemical, and biological characteristics, but also ‘‘ecological’’ characteristics. 

IV. CONCLUSION 

The CLEAR Act makes significant strides in addressing a host of shortcomings 

in the administration of oil and gas activities on the OCS and in other areas of law 

and policy. Additional targeted improvements would maximize the effectiveness of 

these reforms. I look forward to working with the Committee as the CLEAR Act 

moves forward in the legislative process. The need for action is urgent and I commend you again for moving forward with reform legislation. Thank you again for 

this opportunity to testify. 

Ms. BORDALLO. I thank you very much for your testimony, Ms. 

Jones, and now I would like to recognize Dr. Dismukes. 

74 

STATEMENT OF DR. DAVID E. DISMUKES, ASSOCIATE EXECUTIVE DIRECTOR AND DIRECTOR OF POLICY ANALYSIS, CENTER FOR ENERGY STUDIES, LOUISIANA STATE UNIVERSITY 

Dr. DISMUKES. Thank you. Good afternoon, Madam Chairperson 

and Committee members. It is an honor to be here this afternoon. 

My name is David Dismukes. I am a Professor and the Associate 

Executive Director for the Center for Energy Studies at the Louisiana State University. 

The Center for Energy Studies was created by the Louisiana Legislature in 1982, and our purpose is to examine energy-related research that impacts our citizens, our environment, and our economy. 

There are a number of positive provisions that are included in 

the bill before you this afternoon that I think will go a long way 

in helping improve offshore energy regulation. Some of those include the break up of the Minerals Management Service into separate regulatory and governance structures that will look at planning and at revenue collection and enforcement separately. 

Some of the other positive aspects of the bill include the professional resources that will be dedicated to the Minerals Management Service—I mean, to the successor agencies and the ability to 

go in and seek out the best talent to go in and examine pressing 

issues in energy regulation as well as in safety and environmental 

performance. The increased standards associated with reporting 

are also going to be, I think, a positive aspect associated with improved regulation for the offshore areas, as well as the benchmarks 

that were talked about at length earlier in the hearing that I think 

create a unique opportunity in offshore regulation on a foregoing 

basis. 

I think Congress is missing an opportunity there though without 

changing those and maybe enhancing those a little bit by setting 

rewards and penalties to meeting those benchmark targets. By giving profit incentives for performing in best of class or exceeding 

those classes and by invoking symmetrical penalties for not meeting those standards I think you will go a long way in encouraging 

the types of research and development that you are thinking about 

in this particular provision of this legislation for mitigating spills 

and improving technology in oil and gas activities. 

However, despite a lot of those good provisions that are in the 

bill there are a number of deficiencies, particularly as they relate 

to Louisiana. The first and one of the most important ones have to 

do with the provisions that would remove the current incentive programs for deep gas drilling in the shallow waters of the Gulf of 

Mexico, as well as provisions that would remove the incentive program for the deepwater Gulf of Mexico itself. Those provisions are 

essentially job killers for a lot of people along the Gulf of Mexico. 

There are 250,000 people in the Gulf states that make their living just directly in either exploration, production, or services for 

the oil and gas business along the Gulf states. There are 100,000 

of those that live and work in the coastal counties and parishes of 

the Gulf of Mexico alone, and many of those are engaged in these 

deepwater activities as well as some of these emerging activities 

with deep gas. Removing those incentives will make the Gulf a 

75 

much less attractive place than it has been over the last 10 to 15 

years, and will discourage job creation in that area. 

Another deficiency that is in the bill is an opportunity to address 

a longstanding inequity associated with the mineral revenue process between the states and the Federal Government, and that is 

the opportunities of sharing revenues with the coastal states that 

are impacted by these activities. The provisions that are in this bill 

that would share 10 percent among a wide range of coastal states 

regardless of their participation in energy production right now is 

one that is somewhat difficult. Louisiana as well as the other coastal states have made big contributions in terms of supporting existing as well as current and future energy production, and certainly 

accelerating those energy revenue-sharing provisions that were in 

earlier legislation is an opportunity that could be included in this 

bill as well. 

I want to thank you for the opportunity of speaking before you 

this afternoon, and look forward to the questions that you may 

have. 

[The prepared statement of Dr. Dismukes follows:] 

Statement of David E. Dismukes, Ph.D., Professor, Associate Executive 

Director, and Director of Policy Analysis, Center for Energy Studies, 

Louisiana State University 

Chairman Rahall, Ranking Member Hastings, and Committee members, thank 

you for the opportunity to appear before this Committee to share my opinions on 

the proposed Consolidated Land, Energy, and Aquatic Resources Act (‘‘CLEAR’’) 

that is the subject of today’s hearing. 

My name is David E. Dismukes and I am a Professor and Associate Executive Director for the Center for Energy Studies at the Louisiana State University in Baton 

Rouge, Louisiana. The Center for Energy Studies is a state-funded research institute that was created by the Louisiana Legislature in 1982 to examine energy-related issues impacting our economy, citizenry, and environment. 

The Center takes a multidisciplinary approach to examining or supporting a wide 

range of energy-related research. For the past 15 years, one area of concentration 

has been issues associated with offshore oil and gas exploration and production, 

much of which has been done on the behalf of the Minerals Management Service 

(‘‘MMS’’). 

The proposed CLEAR Act that is the subject of today’s hearing is certainly an ambitious piece of legislation designed to change offshore energy regulatory policies in 

the aftermath of the Deepwater Horizon accident. The Bill includes a number of 

positive provisions. For instance, Sections 101 to 103, and Section 107, collectively, 

would allocate the planning, leasing, and inspection functions of the former Minerals Management Service into three new bureaus. This separation should help instill greater confidence in each bureau’s independence and remove the conflicts of 

interest that were perceived to be inherent within the old MMS regulatory and governance structure. 

Another important regulatory provision included in the Bill is the framework for 

buttressing each of these new regulatory agencies’ professional staff, allowing them 

to recruit and retain the best available talent in the market within specialized skill 

areas. 

An additionally important provision included within this legislation is the establishment of benchmarks and performance metrics that evaluate operator success at 

meeting expected environmental and safety standards. However, in developing these 

provisions, Congress may be missing a unique opportunity to create a performancebased regulatory structure that establishes a symmetrical system of penalties and 

rewards that can lead to both improved offshore environmental and safety outcomes, 

and private sector research in technologies that will lead to both profitable and environmentally positive outcomes. 

While the bill includes a number of positive provisions, it includes several important deficiencies. I would like to focus on the two most important deficiencies from 

Louisiana’s perspective. The first deficiency in the bill is that it would remove the 

offshore GOM deep gas drilling and deepwater drilling incentives. These provisions 

76 

are simply job killers for a large number of oil and gas employees along the GOM. 

Today, there are more than 250,000 people directly employed in oil and gas related 

activities along the GOM states, more than 100,000 of whom live and work along 

the coastal parishes and counties of the Gulf alone. The Deepwater Royalty Relief 

Act of 1995 is widely credited along the GOM as re-invigorating the Gulf as a viable 

producing basin after a long period of dormancy. 

This deepwater activity will be significantly reduced, if not potentially lost, if 

these incentives are removed. It would be a fallacy to assume that this deepwater 

activity could simply be made up from increased conventional exploration and production opportunities in shallow water or on the shelf. The shallow-water GOM is 

a relatively mature basin that has seen significant production declines in both crude 

and natural gas over the last decade. The only recent opportunities for new and expanded shallow water activity were the deep-drilling gas opportunities facilitated by 

the Energy Policy Act of 2005. Unfortunately, the proposed bill under consideration 

today would eliminate even those emerging opportunities and shut down tens of 

thousands of jobs for Louisiana oil and gas workers, as well as all of the additional 

small businesses that are located along the coast, and rely on these offshore activities for their livelihood. 

In addition to being job killers, these two provisions would also challenge our national energy security as the GOM accounts for 30 percent of all domestic crude oil 

production, and prior to Hurricane Katrina, the region accounted for more than 25 

percent of all domestic natural gas production. There are roughly 120 active deepwater wells in the GOM that account for 21 percent of all domestic crude oil supplies. Removing deepwater incentives would erode this 21 percent contribution 

quickly, resulting in significant impacts on our imports of foreign sources of oil, our 

trade deficit, and our budget deficit. 

The second deficiency in this bill is its failure to address a long-standing inequity 

in the mineral revenue process. Louisiana and other GOM states have supplied the 

U.S. with a significant share of its energy production, transportation, and refining 

capacity for more than a century, and have supported offshore oil and gas activities 

for more than 50 years. Yet despite this contribution, the GOM states have received 

few to no bonuses, rentals, or royalties created by the production just off our shorelines. 

Instead of remedying this inequity, the proposed bill would allocate 10 percent of 

the annual federal mineral revenue from offshore production into a number of competitive grant programs that would be available to all coastal states regardless of 

their historic or current energy production contributions. Congress should use this 

opportunity to create a permanent remedy to this inequity by including revenue 

sharing provisions for those states that are actively supporting offshore energy production activities regardless of whether they are fossil fuel or renewable based. 

I thank you for the opportunity to appear before your Committee to speak about 

these timely and important energy regulation issues. 

Ms. BORDALLO. Thank you very much, Dr. Dismukes, and now 

we will go forward with questions. First, I ask unanimous consent 

to submit for the record statements by Kevin Costner, the Pew Environment Group, and the Nature Conservancy. Hearing no objection from the Committee, so ordered. 

[A statement submitted for the record by Kevin Costner, 

Founder, CINC, follows:] 

Statement submitted for the record by Kevin Costner, Founder, CINC, and 

Co-Founder/Partner, Ocean Therapy Solutions, WestPac Resources 

Link to video demonstration of CINC technology: www.ots.org 

Mr. Chairman, Members of the Committee thank you for inviting me to testify 

before your legislative hearing on this important piece of legislation. As you know, 

for personal reasons, I am unable to appear before you, but instead am submitting 

written testimony for the record. I am grateful for this opportunity. 

For the past seventeen years, I have invested in and commercially adapted a 

transfer of technology from the Department of Energy at Costner Industries Nevada 

Corporation (CINC). At CINC we manufactured a rugged, robust, portable and commercially viable centrifugal force machine that can separate large volumes of water 

from oil. We developed five different sizes with the largest able to handle up to 200 

gallons per minute in a variety of adverse conditions and able to separate various 

77 

viscosities with both oil and water outputs 99.9% pure. Simply put, this is the ‘‘best 

available technology’’ at this time for cleaning up any size oil spill. This was all accomplished with over $20 million of my own money. 

This machine has had a life of its own. I’ve been along for the ride, from dreaming 

about the possibility, to engineering success, to disbelief and frustration when I was 

met with an apathetic response, right up to this moment. I am proud that this technology can now be part of the immediate solution to remediation in the Gulf, though 

I am disappointed with the events, which ultimately shed light on its capabilities. 

In the last two weeks I made two trips to DC, to testify before Congress. I was 

asked to explain how or why this 21st century technology, which is unparalleled in 

its efficiency for separating oil and water, has sat idly on the shelves while we continued to use booms and skimmers to rake oil pollution across our precious oceans, 

lakes and rivers. Of course spills continued after the Exxon Valdez, despite industry 

rhetoric, and of course they will continue long after the world has moved its attention off this most recent tragedy in the Gulf. In my testimony I have been consistent 

in asking for mandated safety protocols, not just on oil rigs, but anywhere oil has 

the potential to meet water, be it salt or fresh, bays, lakes or smaller streams and 

tributaries. And I will continue to work to see that this machine was used as I intended it to be—as a first and most efficient responder to mitigate oil spills of any 

size around the world. 

I believe this Committee’s bill begins to address the critical need for escalated oil 

spill response capabilities in this country. 

Long term needs 

Shortly after the Deepwater Horizon rig exploded and sank, I formed Ocean Therapy Solutions (OTS) with a renewed intention to put my machines to work, to give 

the people of the Gulf a chance to fight back, to give the Gulf and everything in 

it’s ecosystem a shield of protection. 

As has been announced, OTS is deploying 32 machines to the Gulf in partnership 

with BP to address the immediate Deepwater Horizon catastrophe. (Ten will be 

operational in the Gulf by July 5, and the remaining 22 by August 20.) Equally important is BP’s commitment to a continued partnership with OTS and their desire 

to ensure a legitimate response capability in the future. BP COO Doug Suttles said 

of our machine: ‘‘This is real technology with real science behind it, and it passed 

all of those tests’’ in reference to a series of rigorous tests BP put our machine 

through in difficult environments. If Doug is right, CINC will lead as I intended it 

to, and change the way we think about 21st century oil spill response. 

Achievable response plans 

The establishment of the Bureau of Safety and Environmental Enforcement within the Mineral Management Service (MMS) is a critical first step in ensuring thorough and consistent monitoring within the oil industry. The establishment of an 

independent Training Academy takes us one step further by ensuring we have welltrained safety officers to keep the best interests of the nation in mind as they enforce compliance. 

I support the redundancies and overall emphasis placed on safety in the Committee’s Bill H.R. 3534. This is a major step forward in dealing with the country’s painfully obvious outdated oil spill safety systems and a nod to the classic logic of—one 

can never be too safe. There are multiple references in the bill that would require 

drilling plans to have ‘‘the capabilities and technology to respond immediately and 

effectively to a worst-case oil spill in real-world conditions in the area of the proposed activity.’’ I would add that these plans need to establish a dual framework 

to include both A) first response capabilities; and B) long term recovery and environmental monitoring. 

As we move forward, our response plans need to reflect realistically the best available technology and be individually tailored for each particular oil or mineral recovery program. They cannot be plagiarized of thoughtlessly reproduced. It is true what 

out mothers said, that trying to cut corners, never saves you any time in the end. 

Some people thought we wouldn’t see another big spill after the Exxon Valdez. 

Unfortunately we are facing 60,000 barrels of oil gushing into the Gulf every day, 

with no end in sight and no greater clean up capabilities than we had during the 

Exxon Valdez. So how did we get here? And how is it that we haven’t spent the 

last twenty years preparing for another spill? 

The plans that got us here, that claimed they could clean up 250,000 gallons a 

day, that were rubber-stamped by the MMS can no longer be tolerated. Hypothetical 

projections of an industry’s response capabilities are no longer good enough. Not 

after what we’ve seen in the Gulf. We need proven technologies and an institutional 

support structure to foster the growth of improved technologies into the future. 

78 

Elevate and invest in clean spill technology 

I for one support and believe this bill closes a critical loophole, in that it will require the Secretary of Interior to publish a list of ‘‘best available technologies 

for. . .oil spill response’’ within six months of passage. As you know I battled to get 

CINC technology before virtually every major U.S. oil company and every government agency involved in regulating the oil industry. It took this catastrophe to get 

their attention focused on the incredible output of this technology. 

I hope that by establishing the ‘‘Offshore Technology Research and Risk Assessment Program,’’ a third party verification for all safety related equipment, new technology will have the chance to be tested and ready for deployment before spills 

occur. A published list of these technologies should create transparency within the 

system and allow those technologies that should be included a way forward within 

the industry. Indeed the hope is for a combined analysis of industry trends, and the 

reviews of best available technologies to guide federal research dollars toward the 

develop 22nd Century oil spill technology. 

I would ask in this vein, not as a guy hawking his product, but as a citizen, an 

ocean lover and coastal resident that we also choose to emphasize and advance clean 

oil spill technologies. We can do better than we are right now, using technologies 

that pollute to clean up pollution. We need to think bigger and dream more ambitiously about where technology can take us. We need to actually move beyond booms 

and skimmers, which have been our first line of defense against oil spills for the 

last hundred years. 

I’ve thought that way and continue to think that way as I evolve in this space, 

footing the bill to push the envelope of progress. It took only three years of heavy 

research and development to move the centrifuge patent I purchased from the Department of Energy from a six-inch device for separating metals, to a rugged, portable, eight-foot tall machine that could separate 200 gallons of water and oil every 

minute. Today it is evident that this technology has eclipsed all other current oil 

spill technology, and we’ve been here for over a decade. The bar can and should be 

raised now. 

Additionally, my company has begun an exciting collaboration with Edison 

Choest, the largest oil servicer in the Gulf. We are in the final stages of designing 

and engineering emergency response ships that would be staged strategically 

throughout the Gulf. These ‘‘fire truck’’ vessels would be able to be onsite within 

two hours of an oil spill incident. This collaboration could fundamentally change the 

world’s approach to oil spill recovery. We won’t stop there. 

If we have the intellect and technology to dig down thousands of feet into the 

earth’s core, I believe we have the intellect and the technology to hunt down underwater oil plumes, to engage and grapple with oil out on the blue water, before it 

ever has a chance to hit our shores. We will continue to get better and expand our 

capabilities so that when the next spill happens, even fishermen have small-scale 

centrifuges on board and ordinary citizens become the cavalry, running defense 

against spills to protect their own communities. Any authorized Research & Development (R&D) program must be funded to its maximum to ensure the United States 

can contribute to the solution if we are indeed the ones creating the problem. 

Investing in American solutions 

As a business owner with a manufacturing plant in Carson City, Nevada I appreciate the ‘‘buy and build America’’ provision in this bill. I agree that we need to recapture our manufacturing base in this country. As I have demonstrated, we can 

accomplish great things if there is a strengthened collaboration between the private 

sector and technologies developed and patented by the Federal laboratories. 

CINC has bridged the gap for oil response up to this point, but we need to start 

thinking now about the 22nd Century. We need an R&D plan for environmental 

technologies that can match our hunger for growth and natural resources as our society continues to mature. Coupled with the advancement of research and investment in new technologies this new ‘‘buy and build America’’ provision, can put 

America back to work and make us a leader in oil spill prevention and response. 

I believe this section is a step in the right direction. 

Conclusion 

Everyone is now well aware of the fact that both the oil industry and the federal 

government hampered a more robust research and development program by significantly underfunding research and development programs. This bill, if passed, will 

do a great deal to change that. But this disaster has also shown that our response 

system needs to be flexible in times of emergency to deploy proven technologies. The 

American people need to be able to count on someone of authority to make those 

79 

decisions, in that moment, when their safety and the health of environment are at 

stake. 

I believe there is good will in the Congress to change this. It is my hope that this 

bill will bring safety and openness in this system. 

Thank you. 

[A letter submitted for the record by Karen Steuer, Director, 

Government Relations, Pew Environment Group, follows:] 

June 29, 2010 

The Honorable Nick J. Rahall II 

Chairman 

Committee on Natural Resources 

1324 Longworth House Office Building 

United States House of Representatives 

Washington, DC 20510 

Dear Chairman Rahall: 

On behalf of The Pew Environment Group, I am writing to commend you for your 

leadership in developing a legislative proposal to address the systemic fiscal and environmental problems that have afflicted the Department of the Interior offshore oil 

and gas program for many years. Please include this letter supporting your ‘‘Discussion Draft, Amendment in the Nature of a Substitute to H.R. 3534 dated June 22, 

2010’’ into the Committee on Natural Resources’ June 30, 2010 hearing record. 

Congress has not enacted significant amendments to the Outer Continental Shelf 

Lands Act (OCSLA) since 1978. In the 32 intervening years, advancements in technology have allowed extraction of oil and gas from ever-deeper waters and in new 

areas, but the regulation and environmental review of all OCS drilling operations 

has not kept pace. Clearly the technology for extraction has far outstripped responsible Outer Continental Shelf (OCS) planning and the capacity and quality of oil 

spill prevention and response capabilities. The tragedy of the ongoing Gulf oil spill 

disaster reminds us of the paramount importance of allowing offshore oil and gas 

development to occur only in appropriate places, and only if there are effective policies and practices in place to assure the safety of workers and protection of the environment. 

The Discussion Draft contains a number of vital reforms of the Outer Continental 

Shelf oil and gas program. We are especially supportive of the provisions in Title II 

that: • remedy flaws in the national OCS policy (Section 203); • require the Secretary of the Interior to promulgate new, more protective regulations and in so doing, to consider the views of the Secretary of Commerce on 

matters that may affect the marine and coastal environment (Section 205); • change the leasing provisions of OCSLA to disqualify parties not in compliance 

with certain safety or environmental requirements from bidding on OCS leases 

and require the Secretary of the Interior to consult with the Secretary of Commerce before holding an OCS lease sale (Section 206); • direct a portion of OCS revenue into a new Ocean Resources Conservation and 

Assistance (ORCA) fund (Section 207); • eliminate the use of categorical exclusions to approve exploration plans, extend 

the deadline for approving exploration plans, impose more robust requirement 

for drilling plans, provide for consultation with the Secretary of Commerce before approving exploration permits, and set forth more protective standards for 

drilling (Section 208); • require the Secretary of the Interior to adhere to more protective substantive 

standards when developing five-year oil and gas leasing programs—including 

requirements to minimize environmental damage and consider three consecutive years of science—and to invite and consider comments from the Secretary 

of Commerce during the formulation of the plan (Section 209); • direct the Secretary of the Interior to cooperate with the Secretary of Commerce 

to conduct studies of areas of the OCS open to leasing (Section 210); 

• require more rigorous and more frequent inspections of drill rigs (Section 212); 

and 

• require Development and Production Plans (DPP) for facilities in the Gulf of 

Mexico, provide for more robust DPPs, and prohibit the use of categorical exclusions for approving DPPs (Section 214); 

Title II does much to remedy the flaws in OCSLA and we look forward to working 

with the Committee to strengthen additional provisions of the Discussion Draft to 

80 

ensure the reforms are substantive and meaningful. These provisions include but 

are not limited to the following: • We recommend Section 203 be revised to provide that the OCS ‘‘shall’’ be managed in a manner that ‘‘minimizes’’—not just ‘‘recognizes’’—the potential impacts of development. • To strengthen OCS leasing standards, we recommend Section 206 clarify that 

the lessee is only entitled to an exclusive right ‘‘to seek authorization to’’ ex- plore, develop, and produce. Section 206 should require the Secretary of the Interior to request from the Secretary of Commerce a review of the proposed lease 

sale environmental impact statement, not just a review of the lease sale itself. 

The Secretary of Commerce should have more than 30 days to conduct this review. • As written, Section of 208 requires the Secretary to approve an exploration plan 

if, among other things, an operator meets a strict new spill response standard. 

We recommend this be changed to require the Secretary approve an exploration 

plan ‘‘only’’ if the operator meets the new response standard. The best available 

technology standard and technical systems analysis required by the proposed 

new OCSLA Section 11(j) should apply to OCS exploration plans that contain 

proposals to drill a well in frontier areas as well as exploration plans that propose to drill a well in deepwater areas. • We recommend Section 209 provide a standard to ensure that only specific, limited areas are made available for leasing in the five-year program to help focus 

the leasing schedule. Section 209 should require the Secretary of the Interior 

to consider, when preparing five-year leasing programs, the availability of infrastructure to support oil spill response and important ecological areas. 

We applaud the Committee’s effort to begin to address the difficult challenge of 

broader ocean management with the changes included in Title VI, specifically: • increased coordination between state and federal agencies on decisions affecting 

ocean resources; • comprehensive regional assessments of ocean ecosystems including important 

ecological areas, habitats, and species, as well as current and potential uses; • regional planning to proactively and transparently consider the tradeoffs made 

in allowing for ocean uses, while providing for the protection of marine ecosystem health; and • creation of an Ocean Resources Conservation and Assistance (ORCA) fund. 

In addition, we anticipate and support finalization of the President’s Interagency 

Ocean Policy Task Force work to establish a National Ocean Policy and Framework 

for Coastal and Marine Spatial Planning. This would create a regional planning 

process for ocean management and has benefitted from significant agency, stakeholder, and public input. We suggest modifying Title VI to better coordinate with 

the structure for that work so as to avoid overlapping and duplicative planning processes. 

We are supportive of provisions in Title VII that: 

• repeal incentives and royalty relief for deepwater drilling in the Gulf of Mexico 

and to repeal certain development and production incentives in Planning Areas 

offshore Alaska (Section 701); 

• preclude the Secretary of Commerce, the Administrator of NOAA, or Regional 

Fishery Management Councils from developing or approving fishery management plans or amendments that permit or regulate offshore aquaculture, and 

which invalidate any permit issued pursuant to this authority to conduct offshore aquaculture (Section 704); 

• prevent exploration, development, or production of minerals of the Outer Continental Shelf in areas seaward or adjacent to areas where a state moratorium 

is in effect (Section 705); 

• provide new authority for states to develop and revise plans for improved oil 

spill response under authorities of the Coastal Zone Management Act (Section 

707); and 

• require the President to promote collaboration among federal agencies with 

ocean and coastal related functions; support Regional Ocean Partnerships; and 

establish a National Ocean Council (Section 708). 

Finally, with respect to Title VIII, we support the effort to facilitate and coordinate restoration activities, including establishing a Gulf of Mexico Restoration Planning Program, establishing a long-term monitoring and research program in the region, and establishing a migratory species emergency habitat restoration and establishment program for the Gulf coast. 

In conclusion, we appreciate your leadership in taking on the daunting task of reforming the federal government’s offshore energy programs, both in terms of your 

proposals to assure a fair return to taxpayers for use of their assets by the oil and 

81 

gas industry, and your commitment to protecting the environment from irresponsible practices. We look forward to working with your Committee in moving these 

reforms forward. 

Sincerely, 

Karen Steuer 

Director, Government Relations 

Pew Environment Group 

(202) 491–4535 

CC: Members, Committee on Natural Resources 

Statement submitted for the record by Robert Bendick 

on Behalf of The Nature Conservancy 

Mr. Chairman and members of the Committee, I appreciate this opportunity to 

present The Nature Conservancy’s recommendations for H.R. 3534. My name is 

Robert L. Bendick, Jr. and I am the Director of U.S. Government Relations at the 

Conservancy. 

Introduction 

The Nature Conservancy is an international, non-profit conservation organization 

working around the world to protect ecologically important lands and waters for nature and people. Our mission is to preserve the plants, animals and natural communities that represent the diversity of life on Earth by protecting the lands and 

waters they need to survive. We are best known for our science-based, collaborative 

approach to developing creative solutions to conservation challenges. Our on-theground conservation work is carried out in all 50 states and more than 30 foreign 

countries and is supported by approximately one million individual members. We 

have helped conserve nearly 15 million acres of land in the United States and Canada and more than 102 million acres with local partner organizations globally. 

We commend Chairman Rahall and the Committee for creating such a comprehensive bill. Taken together, its provisions can play a critical role in the conservation of America’s watersheds, natural areas and marine ecosystems for their 

many long-term benefits to our society. 

We believe this is an extremely important piece of legislation for the future of 

America’s lands and waters. The catastrophic Deepwater Horizon Oil Spill in the 

Gulf of Mexico has made the need for passage of this bill more urgent than ever 

and further demonstrates the importance of a comprehensive approach to energy 

production and to addressing the long term and immediate impacts of such production. 

Our testimony covers most sections of the bill because, as the bill and circumstances have changed since its initial introduction, we find that much of this 

legislation is important to the Conservancy’s mission. Thus we respectfully provide 

comments on the following sections: 

• Title II—Federal Oil and Gas Development 

• Title IV—Full Funding for the Land and Water Conservation and Historic Preservation Funds 

• Title V—Alternate Energy Development 

• Title VI—Outer Continental Shelf Coordination and Planning 

• Title VIII—Gulf of Mexico Restoration 

We are also prepared to provide legislative language very quickly for any of these 

sections where you feel that would be useful. 

Title II—Federal Oil and Gas Development 

The Conservancy commends the Committee for the very comprehensive reforms 

to the Outer Continental Shelf (OCS) leasing process that are contained in title II 

of the draft bill. We believe that these amendments would fundamentally restructure the Outer Continental Shelf Lands Act (OCSLA) so that it can serve as a safety 

and environmental statute that will better protect the coastal resources that Americans treasure. 

Following are the principles that the Conservancy would suggest to reform the 

OCS leasing programs, principles that we find well-reflected in the provisions of the 

draft bill. 

The current OCSLA was written to encourage the development of energy and mineral resources on the OCS. Under OCSLA, the Department of Interior is to balance 

the need for energy development with possible harm to coastal and marine biodiversity and habitats. In trying to reach this balance, the Department of Interior acceptVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00085 Fmt 6633 Sfmt 6621 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
82 

ed risks that led to the Deepwater Horizon Oil Spill. OCSLA should be amended 

so that energy and mineral development only occurs if it will not harm coastal and 

marine environments. OCSLA must include clear standards for safety and environmental protection. 

Under OCSLA there are four steps in the Government’s oil and gas decision-making process: 1) the Department develops a five-year leasing plan for the entire OCS; 

2) it conducts specific lease sales; 3) it approves exploration plans submitted by companies holding leases; and 4) it approves permits for production wells. Several reforms are needed in this four-step process: • Up-to-date baseline data on the physical and biodiversity characteristics of each 

OCS area must be in hand before the area can be considered for the leasing 

program. • Environmental assessments under NEPA for the leasing plan and individual 

lease sales must have concurrence from NOAA and must respond to comments 

from other federal and state environmental agencies. • Lease sale areas must be drawn more tightly and be amenable to complete 

analysis so that potential environmental impacts can be fully assessed. • OCSLA should specify the minimum information requirements for exploration 

plans including information about the specific technology that will be used to 

assure safety and respond to accidents. • The Department must have sufficient time (at least 90 days with extensions if 

necessary) to fully review exploration plans. • No part of the decision-making process should be exempted from appropriate 

environmental reviews under categorical exclusions from NEPA requirements. 

Adequate resources have not been available to carry out inspections of offshore 

exploration and production facilities in the Gulf of Mexico region. OCSLA should be 

amended to require a schedule of inspections for each type of facility including 

monthly inspections for drilling rigs. Inspectors should be thoroughly trained. Fees 

from producers should be required at the time that exploration plans and development applications are submitted to cover the cost of inspections and training. The 

inspection and safety branch of the Department should be subject to very tight ethics standards that do not allow employment in the oil and gas industry for five years 

after any inspector leaves the inspection agency. 

OCSLA should be amended to encourage the development and use of better technology for safety and spill prevention on facilities operating on the OCS. The Department of Energy should be directed to establish a technology development program and maintain a clearinghouse for technology information. OCSLA should require the use of best available safety and prevention technologies for activities in 

high risk areas (e.g., deepwater, locations with significant currents, and remote locations). 

OCSLA should be amended to provide that beginning within three years, particular dispersants may not be used (or may not be used for specific purposes or in 

large quantities) unless specifically permitted for that use by the Environmental 

Protection Agency. 

The ‘‘mitigation hierarchy’’ should be fully applied to energy and mineral activities on the OCS. Exploration or production that may adversely affect areas of high 

biodiversity value on the OCS or on, or adjacent to, other coastal waters (as determined by NOAA and FWS) must be avoided. Exploration and production plans must 

be carried out to minimize impacts in other areas. Any impacts to biodiversity or 

habitat that do occur must be fully offset. Similar requirements are included in the 

onshore oil and gas and alternative energy sections of the bill and would also serve 

an important purpose here. 

It is evident that the response plan prepared by BP for the Deepwater Horizon 

drilling platform was wholly inadequate. OCSLA and the Oil Pollution Act should 

be amended to provide that exploration plans may only be approved if they are accompanied by response plans that detail response capacity (oil recovery including 

vessels, booms, relief well plans and equipment; and wildlife protection measures) 

to respond to the worst case release in the specific area where the exploration plan 

is to be carried out. 

The liability limits for damages should be increased to reflect the availability of 

private insurance in the marketplace for smaller companies and be lifted altogether 

for large oil and gas companies with self-insurance capability. The Oil Spill Liability 

Trust Fund should be increased in size and amended to facilitate government response to large spills when responsible parties do not have the capability. 

In addition to these principles, as discussed below, the Conservancy also urges 

that OCS leasing be conducted in accordance with comprehensive regional marine 

plans that integrate all ocean uses to achieve the maximum benefit for the American people. 

83 

Title IV—Full Funding for the Land and Water Conservation and Historic 

Preservation Funds 

The Nature Conservancy strongly and enthusiastically supports Chairman Rahall’s commitment to fully fund the Land and Water Conservation Fund (LWCF). 

This is the most significant proposal to invest in federal land protection in nearly 

a decade and can be an important step to a comprehensive program to conserve by 

various means America’s most significant watersheds, ecosystems and metropolitan 

greenways. 

More specifically, Title IV of H.R. 3534 would provide full, permanent and dedicated funding for the LWCF, the principal source of land acquisition funding for the 

National Park Service, U.S. Fish and Wild Service, Bureau of Land Management 

and the U.S. Forest Service. Such an action would accelerate the fulfillment of the 

President’s promise to fully fund LWCF by FY 2014. It would also provide core 

funding to realize the America’s Great Outdoors Initiative that has been advanced 

by the Obama Administration including funding for the conservation of working 

landscapes through conservation easements and support for increasing access by 

hunters and anglers to public lands. 

The Committee’s Discussion Draft would modify H.R. 3534 by substituting language more closely tracking S. 2747, the Land and Water Reauthorization and 

Funding Act introduced by Senators Bingaman and Baucus. Rather than amending 

the LWCF by mandating a particular formula for the federal and state-side programs of LWCF, the Discussion Draft would allocate $900 million to the purposes 

of LWCF. Such an approach would continue to provide discretion to the Administration and Congress to allocate particular funding levels to the federal and state-side 

programs, plus two competitive matching grant programs that fund land acquisition 

by states and counties—the Forest Legacy and Cooperative Endangered Species 

Conservation Fund, both of which are now funded through LWCF. Enhanced and 

dedicated funding for states to match their own ongoing conservation funding initiatives would allow the states to play an even more significant role in protecting natural areas for their multiple benefits and in providing places for outdoor recreation 

for America’s families. 

The U.S. has been a leader in conservation for well over a century. Even during 

the struggles of the Civil War, President Lincoln provided protection for Yosemite 

Valley. In 1872, the Congress set aside Yellowstone National Park as the world’s 

first national park. And at the turn of the last century, President Theodore Roosevelt created numerous National Monuments, National Forests and the first national wildlife refuge. 

In 1965, responding to a commission created by President Eisenhower and legislation proposed by President Kennedy, Congress created the Land and Water Conservation Fund to provide a reliable source of funding to conserve landscapes 

throughout the nation. Since then, it has been the source of funding for numerous 

federal protected areas, including West Virginia’s Monongahela National Forest and 

Canaan Valley National Wildlife Refuge, Washington’s North Cascades National 

Park, Colorado’s Great Sand Dunes National Park, Montana’s Rocky Mount Front 

Conservation Area, Florida’s Everglades National Park, the Appalachian National 

Scenic Trail and a host of other irreplaceable components of our natural heritage. 

We are, today, faced with unprecedented threats to the integrity of natural, recreational, scenic, and cultural resources and the long-term conservation of our nation’s lands and waters. From our nation’s cities and metropolitan areas to remote 

backcountry locations, Americans depend on natural areas, working landscapes and 

cultural sites in fundamental and diverse ways. Accelerating climate change, continuing population growth, development and other land-use pressures, alternative 

and traditional energy production, constrained federal and state budgets, and the 

increasing separation of young people from experiences with nature all demand 

rapid action if our most important lands and waters are to be protected. 

The need to invest in land conservation is well appreciated by voters throughout 

the nation. In November, 2008, nearly three-fourths of state and local ballot measures for new land and water funding were approved, authorizing $8.4 billion in new 

land and water conservation investments. Yet, there continue to be unmet conservation needs in federal conservation areas and in many of our states. 

Recent public opinion polling demonstrates strong voter support for continued 

funding of the LWCF, particularly in light of the recent Gulf oil spill. For example, 

when asked whether some of the funds from offshore drilling fees should continue 

to go to the LWCF, an overwhelming majority of voters—86 percent—are supVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00087 Fmt 6633 Sfmt 6621 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
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1Polling of 800 voters throughout the United States was conducted from May 11–13 2009 by 

the bipartisan research team of Public Opinion Strategies (R) and Fairbank, Maslin, Maullin, 

Metz & Associates (D). <P> 

portive. And 77% of voters favor dedicating at least $900 million annually to the 

LWCF. 1

There is a national need for expanded and new land and water programs to conserve the network of natural lands and waters, recreational open spaces, working 

landscapes, urban and metropolitan parks, and cultural and historic sites that: • Provide a foundation for our economy through sustainable jobs, including within 

working rural landscapes of forest and agricultural lands and in the expanding 

tourism and recreation industries. (A more detailed description of the economic 

and other benefits of land conservation is attached). • Provide sufficient clean water and other ecological services for a growing U.S. 

population. • Help ecosystems withstand the impacts of climate change so that they can continue to provide habitat for the full range of native species and serve the needs 

of human communities. • Provide access to outdoor recreation and healthy exercise for every American 

from young people living in cities and suburbs to hunters and fishermen seeking traditional outdoor activities. • Reflect the natural and historic heritage and cultural diversity of the American 

people. 

Full and dedicated funding of the Land and Water Fund through this legislation 

would be an immensely important step forward, but in itself it is not sufficient to 

create the network of healthy natural areas and metropolitan greenspaces needed 

to sustain the character and quality of the lives of all Americans. A revitalized Land 

and Water Conservation Fund should be the foundation for the efforts of states, federal agencies, local communities and non-profit organizations to work together to restore and conserve whole watersheds and large landscapes for their multiple benefits. 

The Conservancy also urges the Committee to include in any final legislation provisions to provide full and permanent funding to both the Payments in Lieu of 

Taxes (PILT) and Refuge Revenue Sharing programs. These important programs 

provide payments to counties where land has been taken off the local property tax 

roles and put into federal ownership. In some counties, protection of nationally significant natural resources impacts the tax base that funds local government services, including schools and public safety. Fully funding PILT and the Refuge Revenue Sharing programs would provide an important complement to fully funding 

LWCF and would honor the federal government’s commitment to impacted communities. 

Conservation of our country’s land and water is not a luxury but is an essential 

part of our economy, our health and welfare and our way of life. While our country 

has made wonderful conservation progress over the last hundred years, we have not 

yet conserved sufficient land and water to protect the many values of natural lands 

and working landscapes against the threats they now face. We applaud Chairman 

Rahall for his leadership in proposing to fully fund the LWCF, the core component 

of a renewed commitment to conserve landscapes throughout the nation. 

Title V—Alternate Energy Development 

The Nature Conservancy supports the development of renewable sources of energy 

as an important strategy to mitigate climate change emissions. While desirable to 

reduce greenhouse gas emissions and diversify energy supplies, renewable sources 

of energy require much larger areas of land to produce the same amount of energy 

as the fossil sources they will replace. We, therefore, urge that renewable energy 

development be carefully planned and that any adverse impacts to wildlife habitat 

and ecosystem functions be fully remedied. 

We strongly support the thrust of Title V to quickly evolve the process for development of wind and solar energy resources on public lands away from the present 

‘‘first come, first served’’ right of way approach to a more comprehensive leasing approach, with appropriate provisions to allow an orderly transition from the current 

approach 

We support the requirement in sections 501(b) and 502 to issue comprehensive 

regulations establishing best management practices, including incorporation of the 

full mitigation hierarchy (avoid, minimize, and if necessary offset) across the full 

range of adverse impacts of wind and solar development. Any such regulations 

should be in addition to and fully consistent with the provisions of the Endangered 

Species Act. These additional requirements, if strengthened as indicated below, will 

85 

help ensure that the development of wind and solar energy is accomplished in a rational manner while ensuring that such development involves the least possible adverse impact on other important values associated with and societal benefits derived 

from public lands. In partnership with the Environmental Law Institute, the Conservancy has recently completed extensive research on the use of mitigation in the 

U.S. We believe that the rigorous application of the mitigation hierarchy by Federal 

agencies using an ecosystem framework for making decisions can avoid severe environmental damage and can result in the much more effective expenditure of compensatory funds. A comprehensive approach to mitigation using new and existing 

State and Federal plans as a framework for decision-making can both improve environmental protection and facilitate siting of alternative energy facilities. 

While we support the thrust of Title V, we also believe that its provisions can and 

should be strengthened in important ways: • The siting of renewable energy facilities is hampered by a lack of the necessary 

scientific data on biodiversity impacts and governmental mechanisms to employ 

such data in comprehensive plans. A comprehensive long-range regional framework should be developed to collect the scientific data necessary to optimally 

site renewable energy facilities, consider cumulative impacts, provide for the 

full application of the mitigation hierarchy (avoid, minimize, or offset) with regard to environmental impacts, and coordinate energy and transmission development with other land uses. • The Secretary of the Interior should, as an essential step in developing a comprehensive leasing approach, be required to identify areas of federal land suitable for wind and solar energy development that would minimize conflict with 

other uses including recreation and habitat for wildlife, taking into consideration completed and ongoing efforts to identify such areas and the results of 

consultation and coordination with other federal agencies, state and local officials, industry participants, environmental organizations, and other stakeholders. These planning efforts should define the total capacity (load limits) for 

renewable energy production from wind and solar resources in the geographic 

region covered by the plan and should include an analysis of the impact of full 

capacity utilization on other competing land and resource uses in the region. • This will help ensure that the leasing program will: 

Æ consider the potential cumulative effects of a full build out of such facilities 

on biodiversity, water resources, including natural aquifers, springs, seeps, 

perennial or ephemeral streams, and washes, and other key resources within 

areas identified for leasing; Æ allow rational coordination with the improvement and expansion of necessary 

transmission facilities and other associated infrastructure; Æ facilitate the orderly development of facilities within areas made available for 

leasing; and 

Æ allow full development with the least possible impact on natural systems and 

other values and benefits derived from public lands. 

• Title V should contain express and detailed siting criteria and require such criteria to be incorporated into the regulations implementing the leasing program. 

Inclusion of such criteria will allow Congress to ensure that the leasing program 

is implemented in a manner that minimizes the impacts of development on 

other resources and the need for associated infrastructure through economies of 

scale and ‘‘clustering’’ of development, where possible in already disturbed 

areas, while maximizing production—in other words, to help concentrate renewable development in areas that do not involve significant ecological impacts. 

• Title V should specifically address water use by solar thermal facilities in desert 

basins. Given the extremely dry conditions in the regions likely to host significant solar energy development, even the modest water requirements of drycooled concentrating solar and photovoltaic facilities may represent considerable 

stress on the limited local water resources. In addition, climate change models 

project that the desert will become even drier in the future, making water resources in the desert all the more precious and subject to overuse. Wet-cooling 

of solar-thermal facilities may be incompatible with these dry ecosystems. 

Therefore, we recommend that as a pre-condition of being granted a permit or 

lease, every solar energy developer should be required to submit for approval an 

evaluation of their water supply needs, a proposal for the source of that water, an 

assessment of potential impacts of their water use on biodiversity, a comprehensive 

water monitoring plan to identify any adverse impacts on the local water resources, 

and detailed mitigation measures for estimated water resource impacts including 

contingency measures for unforeseen impacts detected by later monitoring. As a condition for operation, the permitted entity should be required to pay for implementation of the approved water monitoring plan. 

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• Title V should provide additional guidance, consistent with and supplemental 

to regulations and guidance implementing the Endangered Species Act of 1973, 

concerning and mechanisms for the effective mitigation of the impacts of wind 

and solar energy development to encourage a shift from traditional, and frequently ineffective, small-scale, ‘‘on site’’ mitigation efforts to a much more effective, larger scale mitigation regime by: 

Æ incorporating the requirement to apply ecosystem-based management (as defined in section 3(6)) in the best management practices required by section 

502(3) and in the regulations required by section 501(b); Æ when suitable private lands are not available allowing the Secretary to identify areas of land suitable as mitigation lands to offset the impacts of wind 

and solar energy development, and to withdraw those lands permanently 

from uses incompatible with accomplishing mitigation objectives; and Æ requiring that mitigation funds dedicated to restoration or enhanced conservation management of public lands be in addition to historical levels of appropriated funding dedicated management of those lands. 

We recommend that income from such rents and royalties be allocated as follows: 

• 20 per cent to the State within which the income from production is derived; • 20 percent to the county or counties from which the income from production is 

derived; • 45 percent to a newly established Treasury account designated the ‘‘Wind and 

Solar Energy Habitat Conservation Fund’’, to be available without further appropriation and available until expended, as supplemental funds to be used for 

conservation purposes over and above required mitigation in ecosystems with 

extensive wind and solar development by the Secretary of the Interior, transferred as supplemental funds for those purposes to other federal agencies, or 

granted for those purposes to states, tribes, or qualified non-governmental organizations, or, as determined by the Secretary, included as supplemental funds 

to the Land and Water Conservation Fund. 

• For a specified period, 15 percent to fund improvements in the system for reviewing and resolving bids for leases for the development of wind and solar energy, with a specified cap on the maximum funding allocated to such purposes, 

with provision that following the specified period, these funds will be allocated 

to the Wind and Solar Energy Habitat Conservation Fund. 

In order to allow realization of the full mitigation and conservation benefit of 

funds allocated to the Wind and Solar Energy Habitat Conservation Fund, we also 

recommend that non-federal recipients of such funds be specifically authorized to: 

• Create an interest-bearing, non-wasting endowment for the management of 

mitigation lands; and 

• Use such funds to satisfy matching funds or cost share requirements of any federal conservation program. 

Modification of the provisions of Title V to adopt the recommendations above 

would, in our view, greatly strengthen its provisions and would facilitate the rapid 

and orderly development of wind and solar energy production facilities on federal 

land while also minimizing the impacts of such development on biodiversity, habitat, water resources, and other values derived from public lands and allowing for 

the full, effective, and sustainable mitigation of any such impacts. 

Title VI—Outer Continental Shelf Coordination and Planning 

Offshore Energy Development and the Creation of an Ocean Resources 

Conservation and Assistance Fund 

The Nature Conservancy applauds the proposed creation of the Ocean Resources 

Conservation and Assistance Fund. Reinvesting a portion of OCS revenues into the 

protection, maintenance, and restoration of ocean, coastal and Great Lakes ecosystems is long overdue and was called for by the U.S. Commission on Ocean Policy. 

We strongly support these provisions of the bill. 

In addition, the regional coordination and planning provisions for offshore energy 

development in Title VI could lead to significant improvements over the current 

processes. In particular, the Conservancy supports the bill’s inclusion of an ecosystem-based and multi-objective context for planning as well, a regional approach 

and greater reliance on spatial data and spatial planning, and taking into account 

the potential impacts of climate change and the need to adapt to such change. To 

further strengthen the bill, we propose the following changes to ensure that regional 

planning fully considers ecological, economic, and social objectives for the allocation 

of ocean space, and adequately considers conservation priorities and marine ecosystem health. 

• Expand the scope of regional strategic plans to address important issues in addition to offshore energy. We propose expanding the purpose and objectives of 

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this Title to allow the Councils to engage in more comprehensive planning for 

multiple offshore uses, including but not limited to offshore energy development. Authorizing the Councils to look holistically at ocean uses will better enable them to consider multiple objectives and cumulative effects. We would like 

to see this legislation support planning and actions that move ocean management towards a more multi-objective, integrated approach, rather than reinforcing non-integrated, sector by sector decision making. However, if a more 

comprehensive approach is not feasible at present, we suggest a phased approach where the Councils may start with offshore energy planning and then 

expand over time to incorporate additional management issues. • Increase the number and geographic coverage of the regions. The regions currently proposed in H.R. 3534 do not align with existing regional governance 

structures, federal agency jurisdictions, marine ecology, and in some cases are 

too large to function effectively (i.e. Atlantic region). Moreover, certain regions 

that are experiencing the pressure of offshore energy development are excluded 

including the Great Lakes and island territories. We suggest the legislation reflect the nine regions as laid out in the President’s Interim CMSP Framework, 

with the recognition that some regions like Alaska may need to be divided into 

sub-regions to recognize the geographic breadth and logistical constraints of 

planning and coordination at such a large scale. • Stakeholder Input to the Councils. We recommend adding language to this Title 

ensuring stakeholder input to the councils and permitting stakeholders to be 

appointed to advisory committees or task forces as needed to obtain necessary 

expertise and advice as input into regional assessments and strategic plans. 

• Council Leadership. To achieve science-based, multi-objective planning that appropriately accounts for ecosystem conditions and impacts, assessments and 

strategic plans need to be administered jointly by representatives from the Department of the Interior and the National Oceanic and Atmospheric Administration (NOAA). The Secretaries of Commerce and Interior should also share equal 

responsibility for appointing members and guiding and approving the work of 

the Councils. 

• Plan Revisions. In reviewing and revising the Strategic Plans, we recommend 

adding language stating the process should be adaptive, include public participation, and use best available science. 

• Establish Funding Source for the Councils. Presently there is no funding mechanism to support the assessments and strategic plans to be developed by the 

Regional Outer Continental Shelf Councils. Solutions include adding a specific 

authorization within the Department of Interior budget or amending the allocation within the ORCA fund to permit the Councils to use the funds in addition 

to the Regional Ocean Partnerships. 

• Strengthen the definitions. In Sec. 3 of this bill, we recommend strengthening 

the definitions of ecosystem based management to make clear that cumulative 

impacts are more than just considered but the agencies are directly managing 

for them. In addition, the definition of ‘‘marine ecosystem health’’ should emphasize marine habitats in addition to species. There should also be provisions 

taking into account the need to adapt to climate change. 

Title VIII—Gulf of Mexico Restoration 

The Deepwater Horizon disaster has now become the largest offshore oil spill in 

U.S. history. The oil still spreading across the Gulf is also an unprecedented environmental catastrophe in one of the most important and productive ecosystems on 

Earth. Coming on top of decades of degradation, merely cleaning up the effects of 

the spill will not be enough to save the Gulf’s ecosystems and all the benefits it provides for the people of the Gulf and the nation. We need a bold vision and comprehensive plan for reversing the long trend of decline and restoring the Gulf to 

good health. The Conservancy is grateful to the Committee for including the structure for this program in title VIII of the bill. 

The health of the Gulf’s ecosystems is important to the future of the Gulf Region 

and the nation. Long seen as a major producer of seafood, trade and energy, the 

Gulf is also home to globally important biological diversity. Warmed by subtropical 

waters and harboring a complex suite of habitats that includes barrier islands, 

hyper-saline bays, coastal marsh estuaries, mangrove forests, shellfish reefs, sea 

grass beds, coral reefs, deep water open ocean, and the delta of the largest river 

on the North American continent, the Gulf of Mexico is one of the most productive 

places on the planet. The lives and livelihoods of 24 million Americans living along 

this coast are linked to the health, resilience and sustainability of the Gulf’s ecosystems. The economy of the United States as a whole is tightly linked to the energy, shipping and other industries that operate in the Gulf region. 

88 

The full impact of the spill on the Gulf’s ecosystems will not be known for some 

time. Scientists tell us that a spill of this magnitude would have profound effects 

on the healthiest of ecosystems, but the risks to Gulf coastal habitats are greatly 

magnified by the decades of degradation that preceded it. A host of disturbances affecting the Gulf include alteration of critical freshwater and sediment inflows, construction of levees and canals in coastal wetlands, conversion and development of 

coastal prairies and forests, dredging and unsustainable harvest of shellfish beds, 

and incompatible use of coral reefs and sea grass beds that have been severely damaged. As a result, many thousands of acres of marshland and other habitats have 

been lost, fisheries and shellfish stocks have declined, dozens of species have become 

threatened or endangered, and the resiliency of these systems in the face of natural 

or man-made disturbances has been compromised. Degradation of our coast affects 

the services provided by these ecosystems. The ability to dampen storm surges is 

lost as marsh and barrier island habitat disappears, vital economic fisheries decline, 

the cost to maintain critical human infrastructure needs increases, and the way of 

life for millions of people becomes more threatened. 

BP must be held accountable for the full cost and extent of damages associated 

with the effects of the spill, but given what’s at stake, the nation’s response must 

go well beyond cleaning up the current spill. With the degraded state of the Gulf, 

limiting our efforts to only cleaning up the direct effects of the spill will not be sufficient to sustain this critical ecosystem. 

Our vision is to reverse the long decline of the Gulf to re-build a healthy and improving Gulf ecosystem that can continue to provide its many benefits to future generations. We need a robust long-term effort to protect and restore Gulf coastal ecosystems, across 5 states from Texas to Florida, restoring critical habitats and the 

ecological processes that sustain them. What needs to be done to achieve this vision 

is well understood: • Restore clean freshwater in-flows to key estuaries, especially the Mississippi, 

providing the freshwater and sediments needed to re-build marshes while reducing the nutrient loads that create dead zones in the Gulf. • Restore millions of acres of estuarine and coastal habitat, such as oyster reefs, 

seagrass beds, marshes and migratory bird areas that provide critical nursery 

habitat to re-build Gulf fisheries and protection for Gulf communities from 

storms and sea level rise. • Ensure ongoing oil and gas development in the Gulf minimizes impacts to important natural resources, is carried out in safe and responsible manner, and 

contributes to the long-term restoration of Gulf ecosystems. 

Title VIII creates a structure to coordinate these efforts across the entire Gulf ecosystem. Led by a chairperson working in the White House, a task force of agencies 

would integrate the many efforts that are ongoing and stimulate planning for the 

large-scale projects, especially restoration of freshwater flows and sediments, that 

are essential to recovering the biological bounty the Gulf once produced. 

We have three suggested changes in the draft language: 

• First, we urge that the Chair of the Task Force be given a stronger role in coordinating the environmental restoration work across federal programs. One 

means to this end would be the presentation of a combined Gulf of Mexico restoration budget as part of the President’s budget presentation each year. This 

would highlight the projects and programs that are being carried out by each 

Federal agency to implement the restoration plan developed by the Task Force. 

A similar approach was taken in the 1980s to coordinate the $600 million acid 

rain research program carried out by the National Acid Precipitation Assessment Program. 

• Second, we think that the Task Force should identify priorities for restoration 

and not simply list every project that every government agency might propose. 

And we believe that addressing the impacts of subsidence and erosion in the 

Mississippi River Delta should receive the highest priority in the early years of 

the effort. It is not necessary to reinvent the restoration agenda in the Delta. 

The work is ready to begin immediately and is of the greatest importance to 

the health of the entire ecosystem. 

• Third, we urge that Congress find a dedicated source of funding to support this 

restoration effort. Crude oil and petroleum products are taxed today at a rate 

of eight cents per barrel to create the Oil Spill Liability Trust Fund that responds to the acute impacts of oil spills. The Gulf of Mexico ecosystem has been 

damaged by the chronic impacts of the same industry over many decades and 

it seems reasonable to us that this same tax mechanism be used to correct the 

damage that has been done. We urge that Congress increase the tax by ten 

cents per barrel and that these funds be dedicated to Gulf of Mexico restoration 

for a period of at least ten years. We fully appreciate that the tax is not the 

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jurisdiction of the Natural Resources Committee and will need to be pursued 

at a later point in the legislative process. 

Summary 

The provisions of H.R. 3534 discussed here are critically important to America’s 

well being. This bill is about giving the American people the means to shape the 

future of the land and water so critical to the health of our citizens and to the character and quality of their lives. It is about carrying on the highly successful conservation tradition that filmmaker Ken Burns calls in his film on our National 

Parks, ‘‘America’s best idea’’ in the face of a new wave of threats that could undo 

those conservation accomplishments. It is, in this very difficult and contentious 

world, about our being responsible citizens and remembering at this critical period 

in history what Theodore Roosevelt said a hundred years ago: 

‘‘It is time for us now as a nation to exercise the same reasonable foresight 

in dealing with our great national resources that would be shown by any 

prudent (person) in conserving and wisely using the property which contains the assurance of well-being for (ourselves and our) children’’. 

Thank you for the opportunity to present The Nature Conservancy’s recommendations for H.R. 3534, The Consolidated Land, Energy, and Aquatic Resources Act of 

2010. 

Ms. BORDALLO. I would like to begin with you, Ms. Jones. I have 

a few questions here. Do you buy the argument that this bill would 

be a job killer or do you think it establishes a balance between various resource-dependent industries, including oil and gas, fishing, 

and tourism? 

Ms. JONES. I think that continuing to do OCS exploration 

unsafely is the job killer. When you look at the number of jobs that 

are supported by having a healthy ecosystem, a healthy marine resource, commercial fishing, recreational fishing, tourism and tourism-related jobs, it is a substantial number of job. 

We recognize that there are oil and gas jobs that are affected as 

well, but this is not just about oil and gas jobs, and it is not just 

about oil and gas exploration. It is about how we actually manage 

our ocean resources responsibly and how we make sure that the 

marine resources are healthy enough to support all of our coastal 

economies. 

Ms. BORDALLO. Do you think the Discussion Draft adequately 

separates the planning, the leasing, and inspection functions in 

MMS, and does it address conflict of interest issues sufficiently? 

Ms. JONES. There is no question that MMS is a broken agency. 

It has been demonstrated quite adequately, that it has been captured by the agency that is it supposed to regulate. The separation 

in the Discussion Draft I think is very useful, separating leasing, 

in particular, from the environmental analysis, from the revenue 

collection is particularly important. 

I do think in addition to that there is a critical need to interject 

a broader view and a broader consideration in making these OCS 

decision because they affect, as demonstrated by the disaster, not 

to just oil and gas but other marine resources. I think one of the 

positive things in the bill as well is to include NOAA, for example, 

as our nation’s oceans agency, and give them a more critical role 

in expressing their views about OCS decisions. 

Ultimately the most important thing, however, is to make sure 

that the standard for pursuing OCS development is one that is protective of marine health. It is our view that it is more important 

to change the nature of the job than it is to restructure the agency, 

but we do think that the Discussion Draft provisions are helpful. 

90 

Ms. BORDALLO. Following up on your mention of NOAA, can you 

explain further what current expertise NOAA offers that should be 

included in the planning and the leasing process? 

Ms. JONES. NOAA has the ability to do some of the widespread 

surveys that are needed to more fully develop our understanding 

and develop some baseline information that is lacking in the marine context. It is the agency where most of the marine resource 

experts are housed. The Fish and Wildlife Service also has expertise as does EPA and the Coast Guard. NOAA stands out, but we 

would also support the inclusion of some of those other resource 

agencies, making sure that as Mineral Management Service’s successor makes these OCS decisions again there are a broader set of 

considerations, not just about oil and gas development but about 

the effect of that development on the environment and the effect 

on our coastal economies as well. 

Ms. BORDALLO. Thank you. Thank you, Ms. Jones. 

Dr. Dismukes, I have a couple of questions for you. You are obviously very concerned about the fact that the bill would repeal the 

deepwater royalty relief provisions from the Energy Policy Act, but 

I would like you to address a few facts. 

There have been over 2,6000 deepwater leases issued since these 

royalty relief provisions came into effect. Companies bid over 9 billion for these leases, and the number of those leases that would 

have royalty free oil today zero. Because all of these leases have 

clauses that say that if the price of oil is greater than about $40 

a barrel, there will be no royalty relief. 

In 2008, companies bid roughly 4 billion for nearly 700 deepwater leases while oil was approaching $150 a barrel. I believe that 

it defies common sense to argue that any of those companies in 

2008 or any of them today expect oil to go below $40 a barrel. 

So how is it credible to say that repealing this provision would 

result in massive job losses and compromise national energy security? 

Dr. DISMUKES. Well, I think for a variety of reasons. The provisions that are included in the Deepwater Royalty Relief Act provided, in addition, a floor for operators that want to develop these 

particular areas in case those prices do wind up falling. They provide security and a sound investment environment for them in the 

Gulf of Mexico, and if you look at one of the reasons why operators 

have returned to the Gulf, a lot of it has to do with the regulatory 

certainty and stability that has been created historically over the 

last 10 to 15 years from provisions, and like the Deepwater Royalty 

Relief Act. 

So I would disagree that the legislation has not had a profound 

impact on the industry. Over 21 percent of our domestic crude oil 

supplies come from deepwater activities and from deepwater production. Most of that occurred after 1995 when the deepwater legislation was passed. 

Ms. BORDALLO. Thank you. Thank you very much, Dr. Dismukes. 

And now we have our Ranking Member, Mr. Cassidy from Louisiana who has a few questions. 

Mr. CASSIDY. Thank you, Madam Chair. 

Dr. Dismukes, again I feel like I am channeling folks from back 

home when I point out that when the Secretary says that his foot 

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is on the neck of BP, they actually feel as if it is on the neck of 

the roustabouts, the rig workers, you know where I am going with 

that. 

Dr. DISMUKES. Yes, sir. 

Mr. CASSIDY. Can you discuss if this, and one thing you just said 

is that there is a great need for certainty when it comes to drilling. 

Dr. DISMUKES. Yes, sir. 

Mr. CASSIDY. An atmosphere of uncertainty creates caution. Caution inhibits investment. Fair statement? 

Dr. DISMUKES. Yes, sir, that is correct. 

Mr. CASSIDY. So can you comment upon the economic impact of 

this job moratorium, if I may put it that way, the way folks back 

home describe it, upon the number of workers, the average wage 

per worker, those jobs relative to jobs in other fields, et cetera? 

Dr. DISMUKES. Well, the oil and gas industry pays an above-average wage in south Louisiana, as you well know, and is a significant 

employer within the state as well as in other communities along 

the Gulf Coast. The current moratoria has the potential of being 

very devastating on the deepwater side as well as some of the activities that you commented on earlier about decreases in shallow 

water activity that we are starting to hear stories and information 

about. 

There is, as I mentioned before, about 100,000 people just in the 

coastal parishes alone, in the coastal parishes and counties along 

the Gulf of Mexico that are dedicated to just the direct jobs associated with oil and gas activity, not the multiplier jobs I am talking 

about, but directly in exploration, directly in production, and directly in in-services. 

If we look over the next six months just for the moratoria along, 

we are looking at probably in the near term as much as 3,000 jobs 

lost, increasing to as much as 6,000 by the time we approach the 

end of the moratorium up to a maximum of close to 10,000 jobs, 

if not more, and that is really based on our forecasts at the current 

price levels of where crude oil is. If those prices were to increase 

and oil and gas activity—that would be foregone oil and gas activity that we would be taking advantage of that we could not because 

of those increases in price, so certainly there are additional opportunities there. 

Some of the conventional wisdom is that we may not make it to 

the six months, that we may go longer than that because the moratorium may—— 

Mr. CASSIDY. Keep in mind the moratorium technically has not 

started because it only begins with the first meeting, and the first 

meeting has not yet been held. 

Dr. DISMUKES. Right. 

Mr. CASSIDY. And then it is only after consideration of those findings, so indeed it truly may be that the moratorium, six-month 

moratorium which we are what—it is now May 20 I think was 

when it was first announced—it is going to be much longer than 

that. 

Dr. DISMUKES. Right. And even if, depending on when we start 

this, at the end of six months it is probably not likely that you will 

have a flash cut into moving right after the six months. There may 

be another permitting process that will go anywhere from 90 to 120 

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days more than that that are going to create additional delays in 

bringing more rigs back on line, so those will create employment 

impacts as well. 

Mr. CASSIDY. OK. And I think there is a misconception that this 

moratorium is going after Tony Hayward, in the sense that it is BP 

executive who is suffering from this, and he may be. He wants his 

life back. On the other hand, those folks I know in south Louisiana, 

south Mississippi and Texas who work on these rigs, can you describe the type of job that we are talking about? 

Dr. DISMUKES. Anything from technical positions, tool pushers 

and people that are involved in the day-in and day-out drilling operations, engineering jobs, service jobs that will come out and provide catering services, that will provide fluids, drilling fluids, other 

types of support equipment that is needed, rental equipment, marine transport back and forth to the boats. There are a wide variety 

of people that service this industry from the shoreline. 

Mr. CASSIDY. So, working-class, middle-class folks and small 

business people. 

Dr. DISMUKES. Primarily, particularly in the service end of the 

business where you have a lot of homegrown businesses in Louisiana, a large portion of those activities being there in the service 

bases along the coast. 

Mr. CASSIDY. Now, I think of a service base, for example, you 

mentioned catering, as being fairly cash-flow dependent. Have you 

done any analysis of how these small businesses will do if this moratorium stretches out? 

Dr. DISMUKES. They will have to find other opportunities or they 

will have to start shutting down operations and laying people off. 

Mr. CASSIDY. So the jobs moratorium, as somebody calls it back 

home, could truly be a jobs moratorium? 

Dr. DISMUKES. It could result in significant job losses and it is 

of great concern for the state right now. 

Mr. CASSIDY. I yield back. 

Ms. BORDALLO. I thank the Ranking Member, and now I would 

like to recognize the gentlelady from California, Ms. Capps. 

Ms. CAPPS. Thank you, Madam Chairwoman. 

It is my conviction that every phase of the offshore drilling, exploration, development and production, can result in significant impacts to the environment, and that is why I believe the Interior Department should prepare an EIS, an Environmental Impact Statement, at every phase of the drilling process. We have made some 

gains in this area in the Pacific Region. For example, seismic surveys off the coast of Santa Barbara require a separate environmental review. I believe this is a good step to ensure meaningful 

opportunity for public participation in the OCS review process. 

Ms. Searles Jones, do you agree that requiring more in depth environmental reviews would provide decisionmakers with critical information concerning potential significant impacts from drilling? 

Ms. JONES. Congresswoman Capps, absolutely. One of the problems with the current OCS statutory scheme, which this Discussion 

Draft takes some great strides in addressing, is that decisions are 

made at such a great level of remove that commit us to a course 

of action that by the time we get to the ability to do any site-specific meaningful analysis that is full and fair, that considers a 

93 

range of alternatives, that displays all of that information for the 

decisionmaker and for the public, that really doesn’t happen. 

The exploration stage, the exploration permit is when that 

should happen, the current law requires the Minerals Management 

Service to approve permits within 30 days after the agency has 

deemed it to be submitted. The agency’s course of practice has been 

to not start any environmental analysis until after it has deemed 

the exploration plan as submitted, and so it basically has created 

a situation where it feels like it only has 30 days to make that decision, and sometimes the lease sale analysis that has preceded the 

exploration plan is on the order of tens of millions of acres, which 

is not a meaningful scale of analysis, and we really cannot display 

the effects. We cannot have a discussion about what the consequences might be. The decisionmaker is denied information that 

it needs to actually make a good decision, and so that is one of the 

key features that this Discussion Draft advances that kind of analysis. 

Ms. CAPPS. Thank you very detailed. Let me follow up. As the 

President has noted, one necessary outcome of BP’s oil spill must 

entail lessening our reliance on fossil fuels and facilitating the implementation of a clean energy policy. This is a long-term goal. 

When the Department prepares an EIS for offshore drilling, do 

you think it is a good idea to require a range of alternatives, including conservation, efficiencies, and renewable sources of energy 

that are capable of avoiding or minimizing the impacts of that drilling? 

Ms. JONES. That is a great question, and I think two things that 

this Discussion Draft starts to do that we can do a little bit better 

is to make these decisions and make these considerations not just 

about oil and gas exploitation, but more broadly about energy production and how we are actually going to meet our energy needs, 

and to expand the range of alternatives to actually consider the effects on other sectors. 

There is some language in the Discussion Draft that moves toward considering other types of resources as you are doing the assessments, and I think that is a very positive thing. Ultimately 

every commission that has ever looked at ocean governance has 

said we have to move away from single sector-by-sector-by-sector 

management. 

When you are in a single sector statute like OCSLA, Outer Continental Shelf Lands Act, it would be a significant advance to have 

that kind of consideration of a broad range of alternatives that includes different types of energy development as well, and understands what the tradeoffs are in making an OCS decision, for example, for renewable site. 

Ms. CAPPS. Madam Chair, I would like to request that this witness be charged with expanding on those thoughts in writing to 

submit to the record for the purposes of this hearing if it is your 

wish. 

Ms. BORDALLO. Hearing no objections, so ordered. 

Ms. CAPPS. Thank you. And I see the yellow light is on, I have 

a couple more questions which I could ask now or could I just press 

on if you do not mind, Mr. Ranking Member? 

94 

In my opinion, the Department should be required to assess the 

response and spill capacity for various spill scenarios in the environmental review process. Now, as we have seen all too clearly 

most cleanup efforts are only 10 to 15 percent effective. I saw that 

with the boom that was laid in 1969 off the Santa Barbara coast, 

the same effects were seen with the kind of spill response that is 

currently going on today. Requiring an analysis is critical to ensure 

that the public and decisionmakers are not misled into believing 

that spills can be effectively cleaned up if they really cannot. This 

CLEAR Act does require a thorough analysis of the impacts associated with various cleanup methodologies. 

Now, here is my particular question to you, which may be need 

to be elucidated a little bit more in this bill. Do you agree that 

these impacts must be addressed up front, up front is the operative 

word, not after a spill occurs so that not only those methods that 

will—so that those methods that will avoid exacerbating spill impacts are allowed? 

In other word, we should be clear ahead of time about which spill 

cleanup methods are appropriate in which scenarios. 

Ms. JONES. I think that is absolutely true. One of the clearest 

lessons learned with the deepwater disaster is that we were not 

prepared. We did not have a spill response plan. We did not have 

adequate response capability. The states are in an exceedingly difficult situation because the spill response plan simply did not deal 

with a disaster of this magnitude. 

It is also true that our technological approaches to actually dealing with oil spills are very limited and they have not changed much 

since the Exxon Valdez days, so we are doing the same thing we 

were doing in the Exxon Valdez, and with Exxon Valdez we only 

recovered about 10 percent of the oil. 

Ms. CAPPS. Right. 

Ms. JONES. So the reality is once it is in the water we have a 

very limited set of tools to deal with it, and it is absolutely our 

view that we should have to demonstrate under real world conditions that we are actually capable of dealing with a worst case spill 

before we actually go ahead and do exploration and production. 

Ms. CAPPS. If I could ask a question at a different level now. 

Should the Federal Government provide additional technical and financial resources to assist the coastal states for their oil spill planning logistics response and recovery? Getting to the point that 

some of the particularities, as I mentioned about what is required 

in California now with our seismic studies that are required up 

front, should there be both a requirement and also the resources 

for doing it to particular states and regions that they could implement specific requests? 

Ms. JONES. Absolutely. 

Ms. CAPPS. And then finally, and thank you for you indulgence, 

Madam Chair, why is the Gulf of Mexico restoration program, 

which is not intended to supplant the existing natural resource 

damage process, why is this program important to understanding 

the chronic impacts of this oil spill? 

Ms. JONES. That is a good question, and I think one thing that 

would be useful in the Discussion Draft would be to clarify the relationship of the restoration program in the bill with the existing 

95 

restoration work that will happen under the Oil Pollution Act of 

1990, the existing natural resource damage assessment process. 

We are witnessing an oil spill of a scale that we have never confronted before. We have a lot of lessons that we can learn from the 

Exxon Valdez, but the reality is that this is a completely new situation. We have never applied this volume of dispersants before. We 

have a lot of different habitat types up and down the coast from 

sandy beaches to marshes. The restoration effort will be very long 

term. It will require a lot of resources and a constant monitoring 

and evaluation of that process is very important. 

And that is one of the other things that this bill helps do. Prevention is the most important thing, but once oil gets in the water 

if you do not have good information about your baseline conditions 

restoration is much more difficult. So, I think this bill does a lot 

of good things to both work on the prevention side, but also try to 

make the restoration side a little bit more possible. 

Ms. CAPPS. Thank you. At what point would the baseline be 

made? Would that be part of this legislation or would that be up 

to the Gulf of Mexico restoration program? 

Ms. JONES. If my memory is correct in terms of where the sections are in here, there is a provision in here that is part of the 

Outer Continental Shelf Lands Act amendment—— 

Ms. CAPPS. Yes, that is a baseline. 

Ms. JONES.—that require some baseline collection. 

Ms. CAPPS. Thank you. Thank you very much. 

Ms. BORDALLO. I thank the gentlelady from California. Now I 

would like to recognize the Ranking Member, Mr. Cassidy. 

Mr. CASSIDY. Ms. Jones, and I know you didn’t intend to but 

there is oftentimes a kind of confusion where people suggest that 

renewable energy, as they typically mean solar and windmills 

which provide electricity, can in some way supplant transportation 

fuel, which is typically fossil fuel. 

Now, are you suggesting that we can supplant our transportation 

requirements with renewables? 

Ms. JONES. It is undeniable right now, Congressman Cassidy, 

that our economy is heavily dependent on fossil fuels. It is also undeniable that fossil fuels are ultimately a finite resource, and that 

there are significant—— 

Mr. CASSIDY. Yes, but that peak oil concept, if you will, has been 

continually disprove in the sense that we continue to have more oil 

discovered, more natural gas discovered. I accept that it is finite in 

the sense that everything is finite except maybe God, except definitely God. On the other hand, there still seems to be a heck of a 

lot more than we thought there was. 

Ms. JONES. And let me be clear. I appreciate your perspective. I 

don’t think that anyone on this Committee thinks—well, I actually 

don’t know if this is true, but I suspect that no one on this Committee thinks that investments in renewables is a bad idea, and ultimately looking at the long term that that is the future of domestic energy production. Given our relative consumption rates and 

our production rates, clearly we need to invest in alternative forms 

of energy as well. 

I appreciate what you say about this being a fossil fuel-based 

economy, and I think that is part of the challenge for us, is how 

96 

as a nation do we turn a little bit and turn the corner toward having a more diverse and renewable energy portfolio so that we can 

actually—— 

Mr. CASSIDY. But even if we say that currently windmills and 

solar provides about 1 percent of our electrical grid, and almost 

none of our transportation needs, there are a few electric cars but 

that is about it, and there is a big dead zone off the mouth of the 

Mississippi from fertilizer coming down the Mississippi, and that 

dead zone in the Gulf of Mexico is related to fertilizers used to 

grow corn to make ethanol, I am a little dubious about the renewables for transportation fuel. Your thoughts? 

Ms. JONES. I am not an transportation fuel renewables expert 

but I would observe that part of what we need to do is to grapple 

more broadly with that energy policy question. 

Mr. CASSIDY. But there is actually a dichotomy, isn’t there, between electricity and transportation? And again, we often blur that 

line when we speak about renewables, we typically mean, again, 

biomass or windmills or solar, but that has almost no relationship 

at all to transportation needs. 

Ms. JONES. I would agree that it has almost no relationship right 

now to the way our transportation system currently operates, but 

necessity is the mother of invention, and part of what I think is 

that if we invest more in different forms of technology, electric cars, 

hybrid cars, there are other alternatives out there, and they are 

worthy of pursuit. 

Mr. CASSIDY. Dr. Dismukes, this CLEAR Act has really a kind 

of novel concept. If a state declares a moratorium on offshore drilling, then the Federal waters are off limit meaning that effectively 

the state owns a Federal resource. If you happen to live in Oregon 

or someplace else, I am specifically not saying Louisiana, you own 

that, and you can tell the people in Kansas even though your tax 

dollars are otherwise flowing and lowing, nevertheless we own it 

and we deny you access except for Louisiana. I am struck by that 

and I would like your perspective on this. 

In Louisiana, we generate all this Gulf of Mexico activity, and 

yet the money is spread out across the nation, so it is kind of like 

what is theirs is theirs, and what is ours is theirs if I want to 

speak of it from a Louisiana perspective. What would be your 

thoughts? 

Dr. DISMUKES. I would agree. Certainly there is an inconsistency 

in that policy. I do think that states should have some say-so over 

the activities that occur off their shoreline. There should be some 

sharing in that activity between the Federal Government and the 

state governments, but I don’t think there has been historically 

that fair sharing relationship as it relates to the offshore energy 

production that has occurred to date in the Gulf of Mexico, particularly as it relates to the Gulf states. 

You see those types of provisions for onshore production and 

mining on Federal lands where you have at least 50/50 sharing relationships, and when the reclamation dollars come back they are 

far in excess of 50 percent going back to the states, and yet you 

don’t have those same kind of relationships for the Gulf Coast 

states for all the energy production that they do, and not just the 

energy production that is offshore, but all the supporting infraVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00100 Fmt 6633 Sfmt 6602 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
97 

structure that is onshore that provides all the gasoline and the nature gas, and the gas transportation, and the gas processing, all 

the petrochemical facilities that are in the state that make these 

plastic bottles that makes the plastic that goes onto the name tags 

that are here, and all the infrastructure, the refined product pipelines that originate in the area, all the other aspects that are there 

because of that energy production. 

Mr. CASSIDY. And so you don’t have to comment on what I am 

about to say, the tyranny of the Federal Government is in the boot 

of our roustabouts and rig workers, denying them the opportunity 

to work for something which has no scientific basis—if you listen 

to the National Academy of Engineering—and it is also in the boot 

of our state in the sense that it allows other states—at least in this 

bill—to effectively have control over their Federal resources, but it 

doesn’t accord the same to us. It continues to put in a job moratorium, which we would object to, on the grounds that it is their 

right. It seems like a bad deal for Louisiana. 

I yield back. Thank you. 

Ms. BORDALLO. I thank the gentleman, and I would like to thank 

the two witnesses, and I do apologize for the long time you spent 

here in the hearing room. We had votes, and so I thank you for 

your patience. 

I would also like to remind you that the hearing record will be 

open for 10 days. The members of the Committee may have additional questions, so please be advised, and we hope that you can 

answer them in a timely manner. 

Without further business here the Full Committee of Natural Resources now stands adjourned. 

[Whereupon, at 2:13 p.m., the Committee was adjourned.] 

[Additional material submitted for the record follows:] 

[A letter submitted for the record by Blancett Ranches follows:] 

Congressman Rahall: 

Thank you for holding the hearings on new and revised regulations for an Industry that is long overdue. 

I am a sixth generation rancher in Northwest New Mexico. Our family has being 

on the same lands for parts of three centuries. The ranch encompasses 30 sections 

of mostly federal lands and a federal grazing permit. 

Early in January and again in March, we notified Conoco Phillips we would be 

putting cattle out on the lower end of the grazing allotment. After being off the 

ranch for the last five years, we returned this year with our cattle. We restored the 

water and wells that were not maintained in our absence. The grass was high, well 

and spring water clean, and the pastures well rested after a 5 years. 

What was not right was the contamination on the well sites throughout the lower 

end of the ranch. We documented the problems with pictures and test results of the 

contamination with a local lab. All test results from the labs of contaminates were 

very high and well above limits allowable. Our information was given to Bureau of 

Land Management in Farmington and Washington, the New Mexico Game and 

Fish, your office and several other congressional offices in DC. To date BLM has 

made no attempt to address the concerns. We as ranchers are charged with the surface stewardship of the land and water for both our livestock and the wildlife. We 

are rendered powerless because the government entities will not enforce the regulations or recognize the standing of other resources. 

The San Juan Basin is the largest producing Natural Gas field in North America. 

The resource dollars from the San Juan Basin number in the BILLIONS each year. 

Our Basin has been designated a sacrifice area for decades on the altar of the oil 

and gas industry. With as much money as is generated in our area, we should have 

the best run gas and oil operation in the Nation and instead it is the worst in the 

Rocky Mountain West. 

98 

Thank you. 

Blancett Ranches (established in 1882) 

Tweeti Blancett 

Linn Blancett 

Box 55 

Aztec, NM 87410 

The documents listed below submitted for the record have been 

retained in the Committee’s official files. 

• Alexander, Ryan, President, Taxpayers for Common Sense Action, Letter dated 

July 12, 2010, addressed to members of the House Committee on Natural 

Resources; 

• Costner, Kevin, Founder, Costner Industries Nevada Corporation and CoFounder/Partner, Ocean Therapy Solutions, WestPac Resources, Video attached 

via website; 

• Defenders of Wildlife, Natural Resources Defense Council, and the Wilderness 

Society, Letter to Chairman Nick Rahall dated July 7, 2010; 

• Emrich, Ron, Executive Director, Preservation New Jersey, Inc., Letter dated 

July 14, 2010, addressed to Chairman Nick Rahall; 

• Erickson, Peggy, Executive Director, Heritage Tourism Alliance (HTA), Letter 

dated July 12, 2010, addressed to Chairman Nick Rahall; 

• Giffords, The Honorable Gabrielle, a Representative in Congress from the State 

of Arizona, Letter submitted for the record; 

• Griggs, Gary, Chair, Ocean Protection Council Science Advisory Team, and 

Director, Institute of Marine Sciences, University of California Santa Cruz, Document entitled ‘‘Ocean Protection Council Science Advisory Team Consensus 

Statement on Ocean Observing’’; 

• Maryland Association of Historic Districts, Testimony dated July 12, 2010; 

• Meadows, William H., The Wilderness Society, Letter dated July 13, 2010, 

addressed to members of the House Committee on Natural Resources; 

• Pierpont, Ruth, President, National Conference of State Historic Preservation 

Officers, and Director, Division for Historic Preservation, New York State Office 

of Parks Recreation and Historic Preservation, Letter dated July 13, 2010, 

addressed to Chairman Nick Rahall; 

• Project on Government Oversight, Document dated July 12, 2010, entitled 

‘‘POGO Recommendations for Improvements to the CLEAR Act, H.R. 3534, to 

Strengthen Oversight and Accountability and End the Cozy Relationship 

Between Interior and Industry’’; 

• Publish What You Pay, Document dated July 7, 2010, entitled 

‘‘Recommendations on Enhancing Transparency and Accountability Measures in 

H.R. 3534’’; 

• Smithberger, Mandy, Project on Government Oversight, Document entitled 

‘‘CLEAR Act Provisions that POGO Hopes Will Survive Markup’’; 

• Tercek, Mark R., President and CEO, The Nature Conservancy, Letter dated 

July 8, 2010, addressed to Chairman Nick Rahall; 

• Trozzo, Charles L., Chairman, Alexandria Historical Restoration and Preservation Commission, Letter dated July 13, 2010, addressed to Chairman Nick 

Rahall; and 

• Wayne, Lucy B., President, American Cultural Resources Association, Letter 

dated July 12, 2010, addressed to Chairman Nick Rahall. 

[A letter submitted for the record by William H. Meadows, The 

Wilderness Society, follows:] 

The Wilderness Society 

1615 M Street NW 

Washington, DC 20036 

Ph (202) 833-2300 

June 29, 2010 

The Honorable Nick Rahall II 

Chairman 

House Committee on Natural Resources 

99 

1324 Longworth House Office Building 

United States House of Representatives 

Washington, DC 20510 

Dear Chairman Rahall: 

On behalf of The Wilderness Society and our 500,000 members and supporters, 

I am writing to commend you for your leadership in developing your legislative proposal to address the systemic fiscal and environmental problems that have accumulated and afflicted the Department of the Interior’s onshore and offshore oil and gas 

programs for many years. Please include this letter supporting your proposal into 

the Committee on Natural Resources’ June 30, 2010 hearing record. 

The abject tragedy of the ongoing Gulf oil spill disaster reminds us of the paramount importance of allowing offshore oil and gas development to occur only in appropriate places, and only if there are effective policies and practices in place to assure the safety of workers and protection of the environment. Moreover, your proposal recognizes the grave risks to the terrestrial environment from the ‘‘drill at any 

cost’’ policies put in place during the past decade, policies which encouraged the extraction of oil and gas resources from our onshore public lands at the expense of 

a healthy environment. And, your proposal addresses a number of vexing problems 

in the fiscal management of our federal oil and gas programs that have needed to 

be rectified for a long time. 

The ‘‘Discussion Draft’’ contains a number of vital reforms of the Outer Continental Shelf oil and gas program. We are especially supportive of provisions in Title 

II, Subtitle A that: strengthen environmental review standards for the protection of 

marine life and coastal areas; require specific and practical oil spill prevention and 

clean-up plans; require the use of ‘‘best availability technology’’ to assure safe drilling operations; and provide more flexibility for the Interior Department to review 

exploration and development plans. The Draft also contains important fiscal reforms 

of the offshore program. 

Provisions of Title II, Subtitle B of the ‘‘Discussion Draft that are of priority importance to The Wilderness Society include: the ‘‘diligent development’’ provisions of 

Sec. 221(a); the directive limiting lease sales to no more than 3 per year per state 

in Sec. 224(b); the increases in yearly rental rates and minimum royalty rates in 

Sec. 224(c); the elimination of non-competitive lease sales in Sec. 224(d); the requirement that Interior mandate ‘‘best management practices’’ for operations on federal 

leases in Sec. 226; the bonding, reclamation, and restoration requirements of Sec. 

227; the wildlife sustainability requirements in Sec. 228; and the chemical disclosure requirements in Sec. 229. With respect to the chemical disclosure provision in 

Sec. 229, we recommend amending the language to require that companies publicly 

disclose the chemicals they intend to use on federal drill sites at least 15 days before 

such chemicals are deployed, in addition to the requirement that disclosure of actual 

chemicals used be disclosed 30 days after operations are completed. We also strongly 

urge inclusion of Sec. 308 of H.R. 3534 as introduced, which repeals Sec. 390 of the 

Energy Policy Act of 2005 (EPACT). The misuse of this provision of EPACT has 

been well-documented by the Government Accountability Office, and should be repealed. Finally, we urge you to include Sec. 221 of H.R. 2337 introduced in the 

109th Congress, which protects the rights of surface owners over federal oil and gas 

deposits. 

We strongly support Title IV of the ‘‘Discussion Draft’’, which re-authorizes the 

Land and Water Conservation Fund with permanent funding, and re-authorizes the 

National Historic Preservation Fund, also with permanent funding, and establishes 

a new Ocean Resources Conservation and Assistance Fund. These programs have 

contributed so much to our nation’s natural and cultural heritage, and we commend 

your commitment to assuring that they are perpetuated and adequately funded into 

the future. The BP oil spill highlights the need for sustained investment of OCS proceeds, through LWCF and the National Historic Preservation Fund, in land conservation. OCS production has always been predicated on the idea that the depletion of one national, non-renewable natural resource must be balanced by the longterm protection of threatened habitats, beaches, waterways, and other special places 

across America. As the devastating effects of the Deepwater Horizon spill demonstrate, OCS production can itself be a major threat to our nation’s already-limited 

inventory of natural resources. Full, reliable funding of LWCF and the National Historic Preservation Fund is needed to provide a fair environmental return to the public, and accordingly, it is time to renew the commitment to conservation through full 

and permanent funding both programs. 

Title V of the ‘‘Discussion Draft’’ is a major step forward in improving the federal 

authorization and environmental review processes governing wind and solar development on federal lands. We commend the Committee for calling on the Department 

100 

to promulgate rules within 18 months that clarify where and how leasing should 

proceed. We recommend that Sec. 501(f) require the Department to issue guidance 

setting out how the backlog of wind and solar applications inherited by this Administration will be worked down in an expedient, fair, and environmentally responsible 

manner. Additionally, we recommend inserting language in Sec. 502 clarifying that 

wilderness-quality lands, lands managed for conservation purposes, and important 

habitat should be avoided or excluded from leasing. Finally, we recommend that 

Sec. 503 authorize a portion of royalty and other revenues to be used to enhance 

the Department’s ability to protect sensitive wildlife and ecosystems to mitigate the 

unavoidable impacts of solar and wind development. 

Finally, with respect to Title VIII, we recommend that in authorizing significant 

spending on restoration, that care be taken to ensure that the restoration strategies 

are chosen with an eye towards the future. The Global Change Research Program 

has identified important projected climate-driven changes in the Gulf, for example, 

which need to guide restoration priorities or else there is significant risk that the 

restoration work could be in vain and the money wasted. Accordingly, we suggest 

that the definition of ‘‘restoration programs and projects’’ be clarified by adding the 

following clause to the end of section 801(d)(2): ‘‘,taking into account the future alteration of regional conditions reasonably projected to be brought about by climate 

change and ocean acidification;’’ 

In conclusion, we greatly appreciate your leadership in taking on the daunting 

task of reforming the federal government’s energy programs, both in terms of your 

proposals to assure a fair return to taxpayers for use of their assets by the oil and 

gas industry, and your commitment to protecting the environment from irresponsible practices, the consequences of which are all too apparent to anyone watching 

the nightly news. We look forward to working with your committee in moving these 

reforms forward. 

Sincerely, 

William H. Meadows 

[A letter submitted for the record by the National Federation of 

Regional Associations for Coastal and Ocean Observing follows:] 

National Federation of Regional Associations 

for Coastal and Ocean Observing 

June 30, 2010 

The Honorable Nick J Rahall, II 

Chairman 

House Natural Resources Committee 

1324 Longworth Office Building 

Washington DC 

The Honorable Doc Hastings 

Ranking Member 

House Natural Resources Committee 

1324 Longworth Office Building 

Washington DC 

Dear Chairman Rahall and Ranking Member Hastings: 

We would like to express our strong support for section 605 of the Consolidated 

Land, Energy and Aquatic Resources Act of 2010 (Discussion Draft, Amendment in 

the Nature of a Substitute to H.R. 3534). Section 605 would establish the Ocean 

Resources Conservation and Assistance (ORCA) Fund for grants to coastal states, 

long-term ocean and coastal observations, and regional ocean partnerships. The importance of these investments is well documented, and unfortunately, the Deepwater Horizon disaster further demonstrates the tremendous need for such support. 

Public Law 111–11 formally established and authorized an Integrated Coastal and 

Ocean Observing System in 2009 to provide sustained observations for our nation’s 

coasts and Great Lakes. The ORCA Fund would allocate the resources to build, operate and maintain this system, providing a sustained source of emergency response 

capabilities, including critical ocean data and models for planners and responders, 

like those needed in the Gulf of Mexico now. But it will also allow the realization 

of broader benefits of an integrated ocean observing system, including those relevant 

101 

to climate and ecosystem trends, water,quality, marine operations, and coastal hazards. 

A sustained ocean observing system for the nation is fundamental to improving 

our understanding and stewardship of the oceans and coasts. Had such system been 

fully funded and implemented before the Deepwater Horizon spill, responders would 

not be faced with the current dearth of ocean observations in the Gulf of Mexico 

that limits plume tracking, modeling, and response. We thank you for¥our commitment to our coasts and Great Lakes and your support for an Ocean Resources Conservation and Assistance Fund. 

Sincerely, 

Mark R. Abbott, Dean, College of Oceanic & Atmospheric Sciences, Oregon State 

University 

Alaska Ocean Observing System 

Applied Science Associates, Inc. South Kingstown, RI 

Larry Atkinson, Slover Professor, Old Dominion University 

Nancy Bird, President, Prince William Sound Science Center 

Wendell S. Brown Professor of Oceanography, University of Massachusetts at 

Dartmouth 

California State Coastal Conservancy 

Caribbean Regional Association for Integrated Ocean Observing 

Council of American Master Mariners 

Richard E. Dodge, Ph.D., Dean, Nova Southeastern University Oceanographic 

Center 

Ian Dutton, President & CEO, Alaska SeaLife Center 

John W. Farrington, University of Massachusetts-Dartmouth 

Newell Garfield, Romberg Tiburon Center, San Francisco State University 

Great Lakes Observing System 

Gary Griggs, Institute of Marine Sciences, University of California, Santa Cruz 

Dr. Burt Jones, University of Southern California Dr. Pete Jumars, University of 

Maine 

Krista Kamer, California State University Council on Ocean Affairs, Science and 

Technology (COAST) 

Michael Kellogg, San Francisco Public Utilities Commission 

Steven E. Lohrenz, Chair and Professor, Department of Marine Science University 

of Southern Mississippi 

Maritime Association of the Port of NY/NJ 

Gil McRae, Director, FL Fish and Wildlife Conservation Commission 

Captain Richard McKenna, Marine Exchange of Southern California 

Mid-Atlantic Coastal Ocean Observing Regional Association 

Mark A. Moline, Center for Coastal Marine Sciences, California Polytechnic State 

University 

Mike Munger, Executive Director, Cook Inlet Regional Citizens Advisory Council 

Northwest Association of Networked Observing Systems 

Northeast Regional Association for Coastal Ocean Observing, Rye, NH 

Ocean Inquiry Project, Seattle WA 

Oregon Department of Land Conservation & Development 

John Payne D POST Staff Scientist and US Coordinator 

Pacific Islands Ocean Observing System 

Port Gamble S’Klallam Tribe 

Quinault Indian Nation 

Roffer’s Ocean Fishing Forecasting Service, Inc., West Melbourne, FL 

Sea-Bird Electronics, Inc. Bellevue, WA 

Dr. Peter Sheng, Professor, University of Florida 

102 

Mark Siegmund, Chairman, Society for Underwater Technology—Houston Branch, 

TX 

Dr. Moby Solangi, President and Chief Executive Officer, Institute for Marine 

Mammal Studies, MS 

Dr. Tom Soniat, Co-founder, Oyster Sentinel, LA 

Southeast Coastal Ocean Observing Regional Association 

Southern California Coastal Ocean Observing System 

Elizabeth Smith, Chesapeake Bay Observing System 

Sound Ocean Systems, Redmond, WA 

Dr. Gregory W. Stone, Director, Coastal Studies Institute and WAVCIS Laboratory, 

LA 

William Sydeman, Farallon Institute for Advanced Ecosystem Research 

Darryl Symonds, Director of Marine Measurements Product Lines, Teledyne RD 

Instruments 

John Ricker, Santa Cruz County of Environmental Health Services 

Dr. Carolyn Thoroughgood, Professor of Marine Science and Policy, College of Earth, 

Ocean, and Environment, University of Delaware 

Dr. Larry Warrenfeltz, IHMC Director for Sponsored Research, Florida Institute for 

Human and Machine Cognition, FL 

Dr. Robert Weisberg, Professor, University of South Florida, FL 

Neil Werner, Executive Director of the Hood Canal Salmon Enhancement Group 

Dr. Brian Taylor, School of Ocean & Earth Science & Technology University of 

Hawaii at Manoa 

J.P. Walsh, East Carolina University 

Dr. Libe Washburn, University of California Santa Barbara 

Woods Hole Oceanographic Institution 

[A letter submitted for the record by the Southern Utah 

Wilderness Alliance follows:] 

Southern Utah Wilderness Alliance 

425 East 100 South 

Salt Lake City, UT 84111 

76 S Main Street 

Moab, UT 84532 

122 C Street NW, Ste 240 

Washington, DC 20001 

June 29, 2010 

The Honorable Nick Rahall II 

Chairman 

House Committee on Natural Resources 

1324 Longworth House Office Building 

United States House of Representatives 

Washington, DC 20510 

Dear Chairman Rahall, 

Thank you for your efforts in reforming the federal government’s oil and gas program. We support the substance outlined in the current discussion draft of your bill, 

H.R. 3534, the Consolidated Land, Energy, and Aquatic Resources Act of 2009 

(CLEAR). 

We strongly support the inclusion Sec. 308 of H.R. 3534 as introduced, which repeals Sec. 390 of the Energy Policy Act of 2005 (EPACT). This section of law was 

abused under the previous administration to exempt drilling projects on public lands 

from important National Environmental Policy Act analyses. SUWA’s recent settlement of a legal challenge brought against the federal government’s misuse of this 

103 

practice has now ended the use of categorical exclusions in cases of extraordinary 

circumstances, making the case for a more permanent statutory fix even more compelling. The misuse of categorical exclusions in the Nine Mile Canyon region in particular threatened Utah’s tremendous wilderness and cultural resources by exempting projects from cumulative impact analysis. Repeal of this section of law will go 

to further restore balance to the government’s oil and gas program and protect 

Utah’s nationally recognized wilderness resources. 

Thank you again for your continued efforts to protect our natural resources and 

restore balance to the federal government’s oil and gas program. We look forward 

to seeing your efforts result in robust and meaningful legislative reform. 

Best Regards, 

Richard Peterson-Cremer 

Legislative Director 

Southern Utah Wilderness Alliance 

[A letter submitted for the record by the Powder River Basin 

Resource Council follows:] 

June 29, 2010 

The Honorable Nick Rahall, II 

Chairman 

House Committee on Natural Resources 

1324 Longworth House Office Building 

United States House of Representatives 

Washington, DC 20510 

Dear Chairman Rahall, 

On behalf of the Powder River Basin Resource Council and our 1,000 members, 

many of whom are impacted by oil and gas development, I write to commend you 

on your efforts to implement much needed reforms for the oil and gas industry. We 

believe these reforms will help address some longstanding regulatory failings regarding onshore activities of the oil and gas industry. Please include this letter supporting your proposal into the Committee on Natural Resources’ June 30, 2010, 

hearing record. 

The elements of the legislation of direct importance to our landowners impacted 

by oil and gas development concern the need for the industry to be adequately bonded in order to assure reclamation and restoration of our lands. As you know, the 

coal industry, under SMCRA, is required to be bonded for the exact cost of reclamation. There is no reason to require less of the oil and gas industry. 

We are also supportive of the provisions to reduce impacts from oil and gas drilling and to require this industry to disclose to the public and affected landowners 

chemicals they use in drilling and production operations. 

Finally, we urge you to support an additional amendment to the bill to provide 

more real protections for split estate surface landowners when federal minerals are 

developed beneath their property. 

We thank you for your leadership and look forward to the passage of this important and long overdue legislation. 

With Best Regards, 

Bob LeResche 

Chair, Powder River Basin Resource Council 

cc: Representative Lummis 

104 

[A letter submitted for the record by Larry Schweiger, President 

& CEO, National Wildlife Federation, follows:] 

June 30, 2010 

Honorable Nick J. Rahall 

Chairman – House Committee on Natural Resources 

1324 Longworth House Office Building 

Washington, DC 20515 

Dear Chairman Rahall, 

On behalf of our four million members and supporters and 47 state and territorial 

affiliates we write in support of the Consolidated Land, Energy, and Aquatic Resources Act of 2010. While there are some areas that should be strengthened and 

improved, overall the CLEAR Act includes many of the most urgent and necessary 

reforms in response to the worst oil spill in Americas History. 

We are especially encouraged by its provisions assuring better environmental, 

safety, leasing and permitting practices both offshore and onshore. Noteworthy are 

the repeal of categorical exclusions, mandatory Best Management Practices, as well 

as chemical disclosure of all materials related to exploration on federal leases. 

We also support provisions in CLEAR that would promote responsible renewable 

energy development. By providing more certainty for project proponents while balancing the needs of wildlife and developers, the bill represents a significant step toward an expansion of renewable energy across the country. We are particularly 

pleased that CLEAR establishes a commercial wind and solar leasing program, requires Interior Department regulations on mandatory best management practices, 

off-site impact mitigation, and ongoing reclamation of a project site, and promotes 

fiscal management reforms intended to ensure the government is receiving ‘‘fair 

market value’’ for taxpayer-owned resources. 

We appreciate the efforts in CLEAR to enhance investments in land, oceans and 

Great Lakes conservation and especially appreciate the dedicated funding for the 

Land and Water Conservation Fund. Unfortunately, as it now stands, the Ocean Resources Conservation and Assistance Fund does not adequately address the needs 

of the ecosystem most impacted by the BP spill. Much of the oil inundating the 

marshes and wetlands of the Mississippi Delta cannot be cleaned up. Instead, we 

will need to invest in the long-term restoration of the coast including funding large 

scale diversions of freshwater and sediment from the Mississippi Delta to these 

coastal areas. Through these efforts, we can over-time, restore the health of this 

internationally significant ecosystem. We urge that the bill be amended over the 

course of the legislative process to ensure dedicated funding for Mississippi Delta 

restoration and expedite the 16 projects already authorized in the Water Resources 

Development Act of 2007. 

We also believe CLEAR could be improved with Education Act (H.R. 3644). This 

bill education programs nationwide. An educated citizenry will make better, more 

informed decisions about their energy sources. 

Other measures we suggest to improve CLEAR: 

• Increase royalty rates from believe the bill should include language on the split 

estate issue that remain private landowners that do not own the minerals 

under issue passed the full House of Representatives in the 110 2005 Energy 

Policy Act that requires BLM to act on a lease within 30 days of receipt of application. We feel this is far too short of time to do a thorough review of the 

application. 

• Dedicate some portion of the to protect sensitive wildlife and ecosystems, including ensuring the conservation of lands essential for natural resource adaptation 

to unavoidable climate change. forms, first, enhance the Department’s ability to 

guide development to smart places with appropriate mitigation requirements 

and second, restoration, mitigation, and land acquisition to help offset the impacts of development. Furthermore, we would recommend language to guide the 

Department’s siting decisions during the 18 month transition to a leasing program. 

Once again, thank you for your leadership in creating a balanced approach to our 

current energy needs and making an investment to our clean energy future. other 

members of the committee to enact the strongest and most effective oil spill response legislation possible. 

Sincerely, 

Larry Schweiger 

President & CEO 

National Wildlife Federation 

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[The Section-by-Section Analysis of the Discussin Draft follows:] 

Consolidated Land, Energy, and Aquatic Resources (CLEAR) Act of 2009 

H.R. 3534 

Section-by-Section 

Of The 

Amendment In The Nature of a Substitute Discussion Draft 

(June 22, 2010, 5:25pm) 

Sec. 1. Short Title.—The title of the bill is the ‘‘Consolidated Land, Energy, and 

Aquatic Resources Act of 2009.’’ 

Sec. 3. Definitions.— 

• The term ‘‘administrator’’ means the Administrator of the National Oceanic and 

Atmospheric Administration (NOAA) 

• The term ‘‘affected Indian tribe’’ means an Indian tribe with federally reserved 

rights affirmed by treaty, statute, order, or other law. 

• The term ‘‘alternative energy’’ means electricity generated by a ‘‘renewable energy resource’’, which is defined as wind, solar, geothermal, marine 

hydrokinetic, biomass, landfill gas, and qualified hydropower, as defined by Section 1301(c) of the Energy Policy Act of 2005 (26 U.S.C. 45(c)). 

• The term ‘‘coastal state’’ is given the same definition as in the Coastal Zone 

Management Act, where it means any of the states bordering the Atlantic, Pacific, Gulf of Mexico, Long Island Sound, Arctic Ocean, or the Great Lakes. 

Puerto Rico and the insular areas are also included in the definition under the 

CZMA (16 U.S.C. 1453). 

• The term ‘‘Department’’ means the Department of the Interior. 

• The term ‘‘ecosystem based management’’ means an integrated approach to 

management considers an entire ecosystem, aims to maintain ecosystems in a 

healthy and sustainable condition, emphasizes the protection of the ecosystem 

as a whole, considers the cumulative impacts of all activities occurring within 

the ecosystem, explicitly accounts for the interconnectedness within an ecosystem, and integrates ecological, social, economic, cultural, and institutional 

perspectives. 

• The term ‘‘Federal land management agency’’ means the Bureau of Land Management, U.S. Forest Service, U.S. Fish and Wildlife Service, and the National 

Park Service. 

• The term ‘‘function’’ means authorities, powers, rights, privileges, immunities, 

programs, projects, activities, duties, and responsibilities. 

• The term ‘‘important ecological area’’ means an area that contributes significantly to local or larger marine ecosystem health or is an especially unique or 

sensitive marine ecosystem. 

• The term ‘‘Indian land’’ has the same definition as under the Indian Tribal Energy Development and Self-Determination Act of 2005 (25 U.S.C. 3501(2)), 

which includes all lands within Indian reservations, pueblo, or rancherias, lands 

held in trust by the United States for tribes or individuals, and certain other 

lands. 

• The term ‘‘marine ecosystem health’’ means the ability of an ecosystem in ocean 

and coastal waters to support and maintain patterns, important processes, and 

productive, sustainable, and resilient communities of organisms, having a species composition, diversity, and functional organization resulting from the natural habitat of the region, such that it is capable of supporting a variety of activities and providing a complete range of ecological benefits. 

• The term ‘‘minerals’’ has the same definition as in the Outer Continental Shelf 

Lands Act (OCSLA; 43 U.S.C. 1331 et seq.), where it means oil, gas, sulphur, 

geopressured-geothermal, and all other minerals authorized by Congress to be 

produced from federal lands. 

• The term ‘‘nonrenewable energy resource’’ means oil and natural gas. 

• The term ‘‘Outer Continental Shelf’’ has the same definition as in the Outer 

Continental Shelf Lands Act (OCSLA; 43 U.S.C. 1331 et seq.), where it means 

all submerged lands lying outside of 3 geographical miles (roughly 3 nautical 

miles) from the coastline of most states, and outside of 9 geographical miles 

(roughly 9 nautical miles) from the Gulf of Mexico coastlines of the states of 

Florida and Texas. 

• The term ‘‘public land State’’ means Alaska, Washington Oregon, California, 

Idaho, Nevada, Utah, Arizona, Montana, Wyoming, Colorado, and New Mexico. 

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• The term ‘‘Regional Ocean Partnership’’ means collaborative initiatives between 

two or more states to implement policies or activities under authorities granted 

to the states under the Coastal Zone Management Act (16 U.S.C. 1451 et seq.). 

• The term ‘‘renewable energy resource’’ means wind, solar, geothermal, biomass, 

landfill gas, incremental hydropower, free-flowing hydropower, wave, tidal, current, and ocean thermal energy. 

• The term ‘‘Secretaries’’ means the Secretary of the Interior and the Secretary 

of Commerce. 

• The term ‘‘Secretary’’ means the Secretary of the Interior. 

• The term ‘‘surface use plan of operations’’ means a plan for the use and restoration of Federal lands for energy development approved by either the Bureau of 

Land Management or the Forest Service. 

• The terms ‘‘Federal land’’, ‘‘lease’’, ‘‘lease site’’, and ‘‘mineral leasing law’’ have 

the same definitions as under the Federal Oil and Gas Royalty Management 

Act (30 U.S.C. 1701 et seq.). 

• The term ‘‘Tribe’’ has the same definition as under the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b(e)). 

Title I—Creation of New Department of the Interior Agencies 

Sec. 101. Bureau of Energy and Resource Management.—This section would 

establish a Bureau of Energy and Resource Management (BERM), with a mandate 

to manage the leasing and permitting for renewable energy, non-renewable energy, 

and mineral resources on all onshore and offshore Federal lands in the United 

States; however, leasing on Indian lands would not be handled by BERM. The 

BERM Director would be appointed by the President and subject to Senate confirmation. Subsection (d) would provide additional authority and direction to the 

Secretary for conducting studies and collecting data that are necessary to fulfill the 

Secretary’s environmental responsibilities under the Outer Continental Shelf Lands 

Act; a separate office within BERM would be responsible for managing the Bureau’s 

environmental studies and analysis activities. Under subsection (f), the Bureau of 

Land Management and Forest Service would retain their authorities as the multiple-use managers of lands under their jurisdiction, and would be responsible for 

ensuring that energy production on Federal lands is done in an environmentally 

sound matter, through the identification of lands and waters that are eligible for 

energy development, the establishment of best management practices, the authorization of waivers to lease stipulations, the establishment and enforcement of appropriate financial assurances to ensure proper site reclamation, environmental site inspections, authority to issues notices of non-compliance for violations of permits and 

surface use plans, and other activities as deemed necessary by the Secretary. Bureau of Safety and Environmental Enforcement (BSEE; established in Section 102) 

employees would also have the authority to issue notices of noncompliance and issue 

civil penalties for land-use violations observed during BSEE inspections. 

Sec. 102. Bureau of Safety and Environmental Enforcement.—This section 

would establish a Bureau of Safety and Environmental Enforcement (BSEE), with 

a mandate to carry out all the safety and environmental regulatory activities, including inspections, on all onshore and offshore Federal lands in the United States. 

The BSEE Director would be appointed by the President and subject to Senate confirmation. Subsection (d) would give BSEE the following responsibilities: oversight 

for BERM’s OCS National Environmental Policy Act (NEPA) reviews; suspension or 

cancellation of leases in the event that activities under those leases threatens health 

or the environment; developing health, safety, and environmental regulations for operations on onshore and offshore federal lands, including mandatory Safety and Environment Management programs; conducting investigations; and implementing the 

new Offshore Technology Research and Risk Assessment Program established under 

Section 211 of this Act. Subsection (e) would require that BSEE inspectors be highly 

qualified and well-trained, and would establish a National Oil and Gas Health and 

Safety Academy (‘‘Academy’’) for training the national oil and gas inspector workforce. Subsection (e) would also allow the Secretary to work with educational institutions and the oil and gas industry to create appropriate training and continuing 

education programs outside the Academy. 

Sec. 103. Office of Natural Resources Revenue.—This section would establish 

an Office of Natural Resources Revenue (ONRR), which would be responsible for collecting and disbursing all royalties and other revenues from energy and mineral related activities on onshore and offshore federal lands, auditing such collections, and 

promulgating regulations relevant to revenue collection and management. Subsection (d) would create an independent program within ONRR to carry out auditing 

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and oversight of revenue collection. The ONRR would be headed by a Deputy Assistant Secretary appointed by the President and subject to Senate confirmation. 

Sec. 104. Ethics.—This section would require that the Secretary of the Interior 

certify that all BERM, BSEE, and ONRR employees that interact with oil and gas 

companies are in full compliance with all Federal employee ethics laws and regulations. 

Sec. 105. Direct Hiring Authority for Critical Scientific and Technical 

Personnel.—This section would allow the government to better compete for talent 

with industry by providing the Secretary authority to hire highly-qualified technical 

personnel for BERM, BSEE, or ONRR outside of the civil service system. In addition, subsection (c) would allow the Secretary to hire certain individuals for up to 

4-year terms at enhanced salaries if those individuals bring extremely high levels 

of crucial expertise, provided that there are no more than 40 such hires at any one 

time at BERM or BSEE. Subsection (d) allows the Secretary to rehire former employees without a reduction of termination of their annuities. 

Sec. 106. References.—This section would ensure that all references to functions 

that previously existed in the Minerals Management Service or in the Bureau of 

Land Management energy program are transferred to the appropriate new entities 

created in this Act. 

Sec. 107. Abolishment of Minerals Management Service.—This section 

would formally abolish the Minerals Management Service (MMS), and ensure that 

all completed administrative proceedings, pending administrative proceedings, and 

pending civil actions related to MMS are not affected by this abolishment. 

Sec. 108. Conforming Amendment.—This section would add the titles of the 

heads of the new agencies to the appropriate pay scale section of the U.S. Code. 

Sec. 109. OCS Safety and Environmental Advisory Board.—This section 

would create a new safety and advisory board under the Federal Advisory Committee Act. This board would be tasked with providing to the Secretary advice on 

safety and environmental issues surrounding energy and mineral development 

issues on the Outer Continental Shelf. 

Title II—Federal Oil and Gas Development 

Subtitle A—Safety, Environmental, and Financial Reform 

of the Outer Continental Shelf Lands Act 

Sec. 201. Short Title.—This title of this subtitle is the ‘‘Outer Continental Shelf 

Lands Act Amendments of 2010.’’ 

Sec. 202. Definitions.—This section would amend the Outer Continental Shelf 

Lands Act (OCSLA) to add a definition for ‘‘safety case’’. A safety case is defined 

as a body of evidence that provides a basis for determining whether a system is adequately safe for a given application in a given environment, and requirements for 

its use in offshore drilling operations have been adopted by a number of countries 

around the world, including Norway and the United Kingdom. 

Sec. 203. National Policy for the Outer Continental Shelf.—This section 

would amend Section 3 of the OCSLA to require a more balanced approach to energy development that acknowledges the other resources of the OCS, and to emphasize that energy-related activities should be conducted without harming the marine, 

coastal, or human environments. 

Sec. 204. Jurisdiction of Laws on the Outer Continental Shelf.—This section would amend Section 4 of the OCSLA to ensure that the laws of the United 

States also apply to renewable energy facilities on the OCS. Currently, U.S. laws 

clearly apply to oil and gas facilities, but court rulings indicate that renewable energy facilities, such as offshore windmills, may not be covered. 

Sec. 205. OCS Leasing Standard.—This section would amend Section 5 of the 

OCSLA to clarify the authority of the Secretary to issue regulations related to operational safety and environmental protection on the OCS, and would require the Secretary to issue regulations mandating: independent third-party certification of crucial pieces of safety equipment (such as blowout preventers); new requirements for 

subsea testing and secondary activation of blowout preventers; independent thirdparty certification of the well casing and cementing procedures; adoption of safety 

and environmental management systems by operators on the OCS; and compliance 

with other environmental and natural resource conservation laws. The Secretary 

would also be required to consult with the Secretary of Commerce on any regulation 

that may affect the marine or coastal environment. This section would also require 

that the Secretary provide to the public, free of charge, any documents incorporated 

by reference into any OCS-related regulations. 

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Sec. 206. Leases, Easements, and Rights-of-Way.—This section would amend 

Section 8 of the OCSLA by adding three new subsections related to royalties and 

financial assurances. New subsection 8(q) would require the Secretary to conduct a 

bonding study at least once every five years to determine if financial assurance levels are adequate for operations on the OCS. New subsection 8(r) would require the 

Secretary to conduct a fiscal system review at least once every three years that 

would outline in-place royalty and rental rates and indicate whether the Secretary 

intended to modify those rates. New subsection 8(s) would require the Secretary to 

conduct a comparative fiscal review at least once every five years, in which would 

assess the overall oil and gas fiscal system of the United States and compare it to 

systems in place in other countries. Subsection (b) of Section 206 would disqualify 

a company from bidding for new leases if it was not meeting safety and environmental requirements on its existing leases, or if it had outstanding obligations 

under the Oil Pollution Act of 1990. Subsection (c) would amend the alternative energy leasing subsection of OCSLA to delete ambiguous language from Section 388 

of EPACT (43 U.S.C. 1337(p)) that could be interpreted to allow non-energy development under the Secretary’s offshore alternative energy leasing authority. The section would also provide for non-competitive authorizations if an applicant were seeking to carry out short-term meteorological or marine testing. Subsection (d) would 

require the Secretary to request a review by the Secretary of Commerce of any proposed lease sale. Subsection (e) would eliminate the authority of the Secretary to 

lease a tract greater than 5,760 acres. 

Sec. 207. Disposition of Revenues.—This section would amend Section 9 of the 

OCSLA to provide for yearly mandatory funding of $900 million for the Land and 

Water Conservation Fund, $150 million for the Historic Preservation Fund, and 10% 

of total offshore revenues for a new Ocean Resources Conservation and Assistance 

(ORCA) Fund, as created by Section 605 of this Act. 

Sec. 208. Exploration Plans.—This section would amend Section 11 of the 

OCSLA to strengthen and create new requirements for exploration plans, as well 

as eliminate the 30-day deadline for approval of those plans. Exploration plans 

would be required to include blowout scenarios with estimated timelines for drilling 

a potential relief well, and an analysis of the impact of a worst-case-scenario discharge from drilling. Categorical exclusions would no longer be allowed for approving plans, and a plan would only be able to be approved if the applicant has demonstrated capability and technology to respond immediately to a worst-case-scenario 

oil spill. Subsection (d) would add additional requirements for obtaining drilling permits, including a full engineering review of the well and safety systems that certifies 

that best available technology will be used. New subsection 11(j) adds additional requirements for deepwater wells, and new subsection 11(k) would provide additional 

authority for the disapproval of a plan if the exploration activities would probably 

cause damage to the marine, coastal, or human environments. 

Sec. 209. OCS Leasing Program.—This section would amend Section 18 of the 

OCSLA to provide for additional consideration of environmental factors in the preparation of 5-year leasing plans. This section would also require consultation with the 

Secretary of Commerce during the preparation of those plans. In addition, a new 

subsection 18(i) is added, which would establish a research and development program designed to improve the ability to estimate oil and gas resources and address 

gaps in environmental data on the OCS. 

Sec. 210. Environmental Studies.—This section would amend Section 20 of the 

OCSLA to require environmental studies, in cooperation with the Secretary of Commerce, at least once every three years of OCS areas where oil and gas lease sales 

are scheduled. Subsection (b) would direct the Secretary to conduct research on the 

impacts of deepwater oil spills and the use of dispersants. 

Sec. 211. Safety Regulations.—This section would amend Section 21 of the 

OCSLA to require more frequent studies by the Secretaries of Interior and Homeland Security on the adequacy of health and safety regulations relevant to operations on the OCS. This section would also broaden the requirement to use best 

available and safest technologies, and require the Secretary to publish lists of the 

best available technologies for key areas of well design and operation, including 

blowout preventers and oil spill response technologies. New subsection 21(g) would 

mandate regulations requiring all operators to have safety cases before they could 

receive new permits to drill. New subsection 21(h) would create an Offshore Technology Research and Risk Assessment Program designed to research and assess industry trends, new drilling technologies, and oil spill response technologies, among 

other topics. 

Sec. 212. Enforcement of Safety and Environmental Regulations.—This 

section would amend Section 22 of the OCSLA to require monthly inspections of 

drilling rigs, more frequent investigations of safety-related incidents on the OCS, inVerDate Nov 24 2008 17:13 Oct 22, 2010 Jkt 000000 PO 00000 Frm 00112 Fmt 6633 Sfmt 6621 L:\DOCS\57230.TXT Hresour1 PsN: KATHY
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vestigations of all allegations brought by employees of operators or contractors, and 

certifications from operators, operators’ Chief Executive Officers, and independent 

third parties regarding compliance with safety and other regulations. 

Sec. 213. Remedies and Penalties.—This section would amend Section 24 of 

the OCSLA to increase civil penalties from $20,000 per day to $75,000 or $150,000 

per day, depending on the violation. Subsection (b) raises the maximum criminal 

fine under the Act from $100,000 to $10,000,000. 

Sec. 214. Uniform Planning for OCS.—This section would amend Section 25 

of the OCSLA to strengthen and create new requirements for development and production plans, and to ensure that such requirements extend to all areas of the OCS, 

whereas in existing law the Gulf of Mexico is exempt. As with exploration plans, 

this section would require development and production plans to include blowout scenarios with estimated timelines for drilling a potential relief well, and an analysis 

of the impact of a worst-case-scenario discharge from drilling. Approval of plans 

through categorical exclusions would no longer be allowed. This section would also 

require applicants to provide a comprehensive survey of the marine and coastal environment within their proposed area of operations, and to use production platform 

as observation stations for collecting data for the Integrated Coastal and Ocean Observing System. Development and production plans would not be able to be approved unless the applicant has the demonstrated ability to effectively remediate a 

worst-case release of oil from activities conducted under the plan. 

Sec. 215. Oil and Gas Information Program.—This section would amend Section 26 of the OCSLA to require lessees to provide additional data on drilling operations to the Secretary, and to provide it in electronic format in real-time, or as 

quickly as possible if real-time is not feasible. This section would also delete provisions requiring the government to pay for data reproduction costs. 

Sec. 216. Limitation on Royalty-in-Kind Program.—This section would 

amend Section 27 of the OCSLA to eliminate the authority for the Secretary to conduct a regular royalty-in-kind program. 

Sec. 217. Repeal of Royalty Relief Provisions.— This section would repeal the 

shallow-water-deep-gas, deep-water, and Alaskan OCS royalty relief provisions that 

were enacted in the Energy Policy Act of 2005 (EPAct) (P.L. 109–58). 

Sec. 218. Registry Requirements.—This section would amend Section 30 of the 

OCSLA to clarify that U.S. immigration laws apply to facilities on the OCS, and to 

require that all vessels conducting operations on the OCS pursuant to the OCSLA, 

including drilling rigs, be flagged in the United States. This section also would add 

an ‘‘intention of Congress’’ section that states that energy development activities on 

the OCS should be conducted in a way so as to support domestic industry and jobs. 

Sec. 219. Developing Innovations in Oil Spill Containment and Response 

Technologies.—This section would add a New Horizon Oil Spill Containment and 

Response Technology grant program to the OCSLA. This program would provide 

competitive grants for research into new technologies for preventing, modeling, responding to, and cleaning up from oil spills. 

Subtitle B—Safety, Environmental, and Financial Reform 

of the Federal Onshore Oil and Gas Leasing Program 

Sec. 221. Diligent Development.—This section would require the promulgation 

of regulations establishing diligent development benchmarks for oil and gas leases. 

The regulations would have to provide for extending those benchmarks in situations 

where diligent development is not possible due to environmental or other restrictions beyond a lessee’s control. 

Sec. 222. Reporting Requirements.—This section would require lessees to report twice a year on the steps that are being taken to develop each of their nonproducing leases. This information would be put into an electronic searchable database available to the public. Currently, according to the Department of the Interior’s 

Inspector General (OIG Evaluation C–EV–MOA–0009–2008, ‘‘Oil and Gas Production on Federal Leases: No Simple Answer,’’ February 2009), the Department does 

not know exactly what is occurring on non-producing leases. 

Sec. 223. Notice Requirements.—This section would require the Secretary of 

the Interior to notify the public, surface land owners, and holders of special use 

recreation permits (such as outdoor recreation companies, hosts of annual events, 

etc.) when relevant lands are being offered for oil and gas leasing. 

Sec. 224. Oil and Gas Leasing System.—This section would amend Section 17 

of the Mineral Leasing Act (30 U.S.C. 181 et seq.) to make changes in the federal 

oil and gas leasing system, such as requiring the receipt of fair market value, changing the bidding system from oral to sealed bids, changing the requirement of a minimum four lease-sales per state per year to a maximum of three lease sales per state 

110 

per year, allowing the Secretary to evaluate the value of the lands proposed for 

lease, and eliminating non-competitive leasing. The national minimum acceptable 

bid would be raised from $2 per acre to $2.50 per acre, and rentals would be raised 

from the current structure of $1.50/acre for the first five years and $2/acre for the 

remaining years, which has not been adjusted since 1987, to $2.50/acre for the first 

five years and $3/acre for the remaining years. The Secretary would also be given 

explicit authority to increase rental rates if necessary to enhance financial returns 

to the United States and to promote more efficient management of oil and gas resources on federal lands. 

Sec. 225. Electronic Reporting.—This section would authorize the Secretary to 

inform Congressional committees of large pipeline right-of-way applications and proposed lease reinstatements electronically instead of through a paper copy, if the 

committee requests. 

Sec. 226. Best Management Practices.—This section would require oil and gas 

operators on federal lands to adhere to best management practices, with site-specific 

adjustments allowed to account for special circumstances. 

Sec. 227. Surface Disturbance, Reclamation.—This section would amend Section 18 of the Mineral Leasing Act to require the submission of interim and final 

reclamation plans along with each application for a permit to drill. Lessees who had 

not completed reclamation activities on existing leases no longer in production 

would be unable to obtain new leases. This section also requires the Secretary to 

set the amount of required financial assurances high enough to ensure that reclamation can be undertaken if necessary, and to establish reclamation standards. 

Sec. 228. Wildlife Sustainability.— This section would direct the Secretaries of 

Interior and Agriculture to plan for and manage areas under their respective jurisdictions in order to maintain sustainable populations of native and desirable nonnative species of plants and animals, consistent with the requirements of existing 

law. If conditions beyond the Secretary’s control prevent sustainability, the Secretary concerned would be required to protect the survival of species and certify that 

management activities do not increase the likelihood of extirpation. The Secretaries 

would be required to establish monitoring programs using identified focal species to 

evaluate sustainability and to coordinate management at the federal and state levels. 

Sec. 229. Online Availability to the Public of Information Relating to Oil 

and Gas Chemical Use.—This section would require the list of chemicals (as well 

as information about those chemicals) used in drilling or completing a well to be 

posted online within 30 days after completion of drilling the well. 

Title III—Oil and Gas Royalty Reform 

Sec. 301. Amendments to Definitions.—This section would add additional detail to the definition of ‘‘mineral leasing law’’ in the Federal Oil and Gas Royalty 

Management Act of 1982, as amended (FOGRMA) (30 U.S.C. 1701 et seq.); would 

clarify the definition of ‘‘designee’’ under FOGRMA in order to allow the Secretary 

to correspond with a designee only, as opposed to having to contact each individual 

lessee (that has designated a designee) in writing as is required under current law; 

would allow penalties to be assessed for permit violations as opposed to just lease 

violations as is currently the case; would include a definition of ‘‘compliance review’’ 

(increasingly used reviews of royalty payments that are less intensive than audits) 

in FOGRMA; and would modify a definition of ‘‘marketing affiliate’’ that existed in 

regulation by no longer requiring that the affiliate’s sole function be the marketing 

of the lessee’s production. 

Sec. 302. Compliance Reviews.—This section would provide statutory authority 

for the Secretary to conduct compliance reviews of royalty payments, and require 

any uncovered discrepancies to be referred to an auditor. The Secretary would have 

to provide notice to payors that a compliance review was being conducted. 

Sec. 303. Clarification of Liability for Royalty Payments.—This section 

would clarify that designees would be liable for royalty payments under a lease, and 

that lease owners and operators would be liable for their pro-rated share of payment 

obligations under a lease. 

Sec. 304. Required Recordkeeping.—This section would require oil and gas 

records to be kept by payors for seven years instead of the current six, which would 

align that timeframe with the statue of limitations for the government established 

under the Royalty Fairness and Simplification Act of 1995 (P.L. 104–185) to collect 

unpaid royalties. 

Sec. 305. Fines and Penalties.—This section would amend FOGRMA to double 

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alty for theft. These penalties have not been increased since 1983. The section would 

also extend the statute of limitations for oil and gas leases held by violators. 

Sec. 306. Interest on Overpayments.—This section would eliminate the requirement, under current law, that the Federal government pay interest on royalty 

overpayments made by operators. This would eliminate the incentive that operators 

have to make errors in their favor on their royalty calculation and receive a guaranteed return of the payment made in error plus interest. 

Sec. 307. Adjustments and Refunds.—This section would eliminate the opportunity for lessees to make adjustments to their royalty obligations after a compliance review or audit is completed on a lease in question, and would limit the ability 

to make adjustments to four years after the date royalties were initially due. Currently, lessees are allowed to make adjustments for a full six years even after MMS 

has already completely a compliance review or audit. 

Sec. 308. Conforming Amendment.—This section would repeal a section of 

FOGRMA that related to a study on noncompetitive leases that was due in 1983. 

Sec. 309. Obligation Period.—This section would establish that in the case of 

an adjustment made by a lessee that results in an underpayment, the lessee would 

be obligated to repay that amount (plus interest) from the date the lessee makes 

the adjustment, thus extending the statute of limitations on that royalty payment. 

This would enable OFEML to audit such lease during the ensuing six-year cycle. 

Sec. 310. Notice Regarding Tolling Agreements and Subpoenas.—This section would allow the Secretary to correspond only with the lease designee in the 

case of subpoenas or agreements to pause the statute of limitations. 

Sec. 311. Appeals and Final Agency Action.—This section would extend the 

timeframe for the Secretary to issue final decisions on any appeals on demands or 

orders to pay royalties or penalties to 48 months, from the current 33 months. 

Sec. 312. Assessments.—This section would repeal a section of FOGRMA that 

prohibits the Secretary from imposing assessments on payors who chronically submit erroneous royalty reports. 

Sec. 313. Collection and Production Accountability.—This section would establish a pilot project for the automated transmission of electronic data from offshore wellheads and meters to the federal government, in order to improve the accuracy and efficiency of data and royalty collection. 

Sec. 314. Natural Gas Reporting.—This section would require the Secretary to 

implement the steps necessary to ensure accurate reporting of heat content values 

of natural gas, which is a key component to determining the amount of royalties 

owed.. 

Sec. 315. Penalty for Late or Incorrect Reporting of Data.—This section 

would establish a penalty for companies that file late or incorrect data, to be set 

at a level the Secretary would determine is sufficient to ensure that companies file 

correct data on time, but no less than $10 per incorrect line of data. The filing of 

late or inaccurate reports creates considerable administrative difficulties for the government, and charging a penalty for faulty reporting has shown in the past to 

incentivize the filing of fully accurate and on-time data. A similar penalty was previously imposed by regulation, but was repealed last year. 

Sec. 316. Required Recordkeeping.—Section 103 of FOGRMA currently gives 

the Secretary of the Interior the authority to require lessees, operators, or anyone 

involved in developing, producing, transporting, purchasing, or selling oil or natural 

gas from federal lands to provide records to the federal government upon request, 

if the Secretary implements such authority by rule. The current regulations promulgated under section 103, however, apply only to lessees and operators, ignoring the 

federal government’s authority to audit natural gas purchasers. Section 216 would 

require the Secretary to amend existing regulations to encompass the full authority 

granted under FOGRMA. 

Sec. 317. Limitation on Royalty-In-Kind Program.—This section would eliminate the ability for the Secretary of the Interior to run a regular program for taking 

oil or gas royalties in kind.. 

Sec. 318. Shared Civil Penalties.—This section would eliminate a disincentive 

for states and tribes to diligently pursue royalty violators. Under current law, any 

civil penalties that are collected under FOGRMA due to the work of State or Tribal 

auditors are divided evenly between the states or tribes and the Federal government. The amount the state or tribe receives from the civil penalty is then subtracted from the amount of money they would have received under their cooperative 

agreements with MMS. This means that, currently, state and tribal auditors receive 

no benefit for any work they do in identifying royalty violators. 

Sec. 319. Applicability to Other Minerals.—This section would extend the civil 

and criminal enforcement authority in FOGRMA, as amended to coal and other solid 

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minerals on federal lands, as well as to solid mineral mining or alternative energy 

development on the Outer Continental Shelf. 

Sec. 320. Entitlements.—This section would require the Secretary to publish 

final regulations regarding procedures for reporting royalties on entitled shares of 

production from unitized leases when lessees do not actually sell their share of production from that lease. 

Title IV—Full Funding for the Land and Water Conservation Fund 

Subtitle A—Land and Water Conservation Fund 

Sec. 401. Amendments to the Land and Water Conservation Fund Act of 

1965.—This section would establish that all language in this subtitle would amend 

the Land and Water Conservation Fund (LWCF) Act of 1965 (16 U.S.C. 460l-4 et 

seq.). 

Sec. 402. Extension of the Land and Water Conservation Fund.—This section would extend the authorization of the LWCF until 2040. 

Sec. 403 Permanent Funding.—This section would provide for $900 million to 

be available to the LWCF each year out of OCS receipts without further appropriations. 

Subtitle B—National Historic Preservation Fund 

Sec. 411. Permanent Funding.—This section would provide for $150 million to 

be available to the Historic Preservation Fund (HPF) each year out of OCS receipts 

without further appropriations, and would extend the authorization of the HPF 

until 2040. 

Title V—Alternative Energy Development 

Sec. 501. Commercial Wind and Solar Leasing Program.—This section 

would establish a leasing program for wind and solar projects on Federal lands, in 

contrast to the special-use permits and rights-of-way authorizations that are used 

now. The Secretary would not be allowed to lease Forest Service lands for renewable 

energy over the objections of the Secretary of Agriculture. Final regulations establishing a leasing program would be required to be published within 18 months after 

the date of enactment, and leasing would be required to commence no later than 

90 days after issuance of the regulations. Subsection (d) would eliminate the ability 

to site commercial solar or wind projects on BLM or Forest Service land using a 

right-of-way or special use permit, although subsection (f) would allow rights-of-way 

or special use permits to be issued for projects that have submitted a plan of development or installed a data collection device prior to the date of enactment of the 

bill. Subsection (e) would allow for the issuance of noncompetitive leases for noncommercial testing purposes, and the Secretary would have the authority to award 

preference to holders of noncompetitive leases during a commercial lease sale. Subsection (g) would require the Secretary to promulgate diligent development requirements for solar and wind leases. 

Sec. 502. Land Management.—This section would require the Secretary to issue 

regulations for solar and wind leasing, establishing the lease terms, bonding requirements, and land reclamation requirements. 

Sec. 503. Revenues.—This section would require the Secretary to set rates for 

rentals, royalties, etc., at a level to ensure a fair return to the United States and 

encourage development of wind and solar energy on federal lands. 

Sec. 504. Recordkeeping and Reporting Requirements.—In order to allow 

for future audits or compliance reviews of renewable energy production on federal 

lands, this section would require lessees, permit holders, or renewable energy operators to maintain records for seven years. 

Sec. 505. Audits.—This section would provide authority for the Secretary to conduct audits of onshore wind and solar leases. 

Sec. 506. Trade Secrets.—This section would allow confidential or proprietary 

information to be made available by the Secretary to other federal agencies if necessary to carry out the provisions of this Act or other federal law. 

Sec. 507. Interest and Substantial Underreporting Assessments.—This section would allow interest to be charged on late royalty payments for wind and solar 

leases, and also would establish a civil penalty of up to 25% for underpayments, in 

addition to making royalty violators subject to the civil penalty provisions of 

FOGRMA. The Secretary would have the authority to waive penalties if the underpayment is corrected before the payor receives a notice from the Secretary of that 

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underpayment, and for other reasons. This section would also establish joint and 

several liability for royalty payments on a lease. 

Sec. 508. Indian Savings Provision.—This section would ensure that the rights 

and interests of Indian tribes are not affected by this Subtitle. 

Title VI—Outer Continental Shelf Coordination and Planning 

Sec. 601. Regional Outer Continental Shelf coordination.—This section 

would address the need for long-term, coordinated planning to guide OCS energy 

development within the context of other activities occurring in OCS regions established in the Atlantic, Pacific, Gulf of Mexico and Alaska. 

Sec. 602. Regional Outer Continental Shelf Councils.—This section would establish Regional OCS Councils (Councils). Council membership would include representatives of relevant Federal agencies, coastal State Governors, affected Tribes, 

and representatives from stakeholder groups such as the relevant Regional Ocean 

Partnership, Regional Fishery Management Council, and interstate marine fisheries 

commission. 

Sec. 603. Regional Outer Continental Shelf strategic plans.—Strategic Plans 

would be prepared and completed by each of the Councils within 2 years after completion of an initial OCS Region assessment and would be used by the Department 

in developing 5-year OCS leasing plans under the OCS Lands Act. 

Sec. 604. Regulations.—This section would direct the Secretaries to promulgate 

regulations to administer this Title. 

Sec. 605. Ocean Resources Conservation and Assistance Fund. A percentage of all OCS revenues would be deposited into an Ocean Resources Conservation 

and Assistance (ORCA) Fund, established by this section, which would provide 

grants to coastal states and Regional Ocean Partnerships for activities that contribute to the protection, maintenance, and restoration of ocean, coastal and Great 

Lakes ecosystems including: the development and implementation of comprehensive, 

science-based plans for monitoring and managing the wide variety of uses affecting 

the oceans, coasts and Great Lakes ecosystems; activities to improve the ability of 

those ecosystems to become more resilient and adapt to and withstand the impacts 

of climate change and ocean acidification; planning for and managing coastal development to minimize the loss of life and property associated with sea-level rise and 

the coastal hazards resulting from it; research, assessment and monitoring that contribute to these purposes; strengthened planning for coastal State oil spill response; 

and the implementation and operation of an integrated ocean observation system. 

Sec. 606. Waiver.—This section would exempt the Councils from the Federal Advisory Committee Act. 

Sec. 607. Transition Period.—To ensure uninterrupted leasing and development of our nation’s OCS resources while the Strategic Plans are being prepared, 

this section would allow the Secretary to continue the preparation and execution of 

5-year plans under the OCS Lands Act, and the leasing of areas for offshore alternative energy under the existing alternative energy rule, until the Strategic Plans 

are approved. 

Sec. 608. Alternative Energy on the Outer Continental Shelf.—Prior to approval of a strategic plan, the Secretary of the Interior would continue to implement 

the rule for Renewable Energy and Alternate Uses of Existing Facilities on the OCS. 

Approval of strategic plans would not affect projects for leases approved under that 

rule, nor tracts of the OCS for which competitive alternative energy leasing process 

under that rule has been initiated prior to submittal of the Plan for approval. 

Title VII—Miscellaneous Provisions 

Sec. 701. Repeal of Certain Taxpayer Subsidized Royalty Relief for the Oil 

and Gas Industry.—This section would repeal the shallow-water-deep-gas, deepwater, and Alaskan OCS royalty relief provisions that were enacted in the Energy 

Policy Act of 2005 (EPAct) (P.L. 109–58). Subsection (c) would repeal language from 

EPAct that provided for lease extensions and royalty relief in the National Petroleum Reserve-Alaska. 

Sec. 702. Conservation Fee.—This section would impose a fee of $2 per barrel 

of oil, or 20 cents per million Btu of natural gas, for production from existing federal 

onshore and offshore leases. This fee would expire on December 31, 2021. 

Sec. 703. Leasing on Indian Lands.—This section would ensure that nothing 

in the bill would amend or modify leasing as it is currently carried out on Indian 

lands by the Bureau of Indian Affairs. 

Sec. 704. Offshore Aquaculture Clarification.—This section clarifies that the 

Secretary of Commerce and the Regional Fishery Management Councils do not have 

the authority to develop or approve fishery management plans for the purposes of 

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permitting or regulating aquaculture in the Exclusive Economic Zone of the United 

States. 

Sec. 705. State Moratoria.— This section would prohibit the Secretary from 

issuing a lease on OCS lands that are seaward or adjacent to a coastal State which 

has a moratorium on offshore oil, gas, and mining activities. 

Sec. 706. Liability for National Wildlife Refuges.— This section would amend 

the National Wildlife Refuge System Administration Act of 1966 to hold any person 

or instrumentality which destroys, causes the loss of, or injures a refuge resource, 

or any living or nonliving resource of the refuge system or marine national monument, liable to the United States. This section authorizes the Secretary to use the 

amounts recovered for costs of response actions and damage assessments. 

Sec. 707. Strengthening Coastal State Oil Spill Planning and Response.— 

This section would amend Section 306 of the Coastal Zone Management Act of 1972 

to provide grants, not to exceed $750,000, to eligible coastal States to revise relevant 

plans of management programs to ensure sufficient oil spill response capabilities. 

Sec. 708. Federal Coordination and Collaboration—This section would direct 

the President to establish policies and processes to promote better coordination and 

collaboration between Federal agencies with ocean and coastal related functions, to 

ensure adequate public comment and to support Regional Ocean Partnerships. 

Sec. 709. Information Sharing.—This section would amend Section 388(b) of 

the Energy Policy Act of 2005 (Public Law 109–58) to require other federal agencies 

to provide data and information to the Secretary of the Interior in support of the 

Coordinated OCS Mapping Initiative. 

Sec. 710. Savings Clause.—This section would ensure that no funds from this 

Act would be able to pay any cost that any responsible party under the Oil Pollution 

Act of 1990 is liable for. 

Title VIII—Gulf of Mexico Restoration 

Sec. 801. Gulf of Mexico Restoration Program.—This section would establish 

a Gulf of Mexico Restoration Task Force, composed of the heads of the relevant Federal agencies and the Governors of the Gulf Coast States, to develop and publish 

a long-term restoration plan within one year after the date of enactment. The Plan 

would identify processes and strategies for coordinating and implementing Federal, 

State, and local restoration programs and projects, using the best-available science. 

Sec. 802. Gulf of Mexico Long-Term Environmental Monitoring and Research program.—This section would direct the Secretary through NOAA to establish a long-term, comprehensive marine environmental monitoring and research program on the impacts of the Deepwater Horizon oil spill on the marine and coastal 

environment of the Gulf of Mexico, to remain in effect for a minimum of 10 years. 

The program would be developed in cooperation with the USGS and in consultation 

with the National Oceanographic Leadership Council, the Gulf Coast States, academic institutions, and other monitoring experts. Data from the program would be 

available to governmental and non-governmental personnel and the public. 

Sec. 803. Gulf of Mexico Emergency Migratory Species Alternative Habitat Program.—This section would establish an emergency migratory species alternative habitat program to support projects along the Northern coast of the Gulf of 

Mexico to ensure that migratory species have alternative habitat available for use 

outside of areas impacted by the oil spill. 

[A Summary of the Discussion Draft follows:] 

Summary of the 

Discussion Draft 

Amendment in the Nature of a Substitute 

[of June 22, 2010 (5:25 p.m.)] 

H.R. 3534 

The ‘‘Consolidated Land, Energy, and Aquatic Resources (CLEAR) Act ’’ 

• The Discussion Draft maintains and builds upon the ‘‘Consolidated Land, Energy, and Aquatic Resources (CLEAR) Act’’ (H.R. 3534), as introduced by 

House Natural Resources Committee Chairman Nick J. Rahall last year and 

which was the subject of two days of hearings by the committee. In recognition 

of the enormous sea change caused by the Deepwater Horizon incident, the 

draft would enact significant and wide-ranging amendments to ensure that oil 

and gas development in the U.S. is done efficiently while protecting human 

115 

safety and the environment. The draft would also create an Oceans Resources 

Conservation and Assistance Fund (ORCA) with oil and gas leasing revenues 

and fully fund the Land and Water Conservation Fund (LWCF) and the Historic 

Preservation Fund (HPF). 

The Discussion Draft would: 

Reorganize and Consolidate Energy Leasing Programs for Greater 

Efficiency & Effectiveness 

• Abolish the Minerals Management Service and divide it into three separate entities: 

o The Bureau of Energy and Resource Management (BERM), which would manage leasing & permitting both offshore and onshore oil and gas and renewable 

energy-related activities, and conduct necessary environmental studies; 

o The Bureau of Safety and Environmental Enforcement (BSEE), which would 

conduct all inspections and investigations, and issue health, safety, and environmental regulations for both offshore and onshore oil and gas and renewable energy-related activities; and 

o The Office of Natural Resource Revenue (ONRR), which would collect all offshore and onshore oil and gas and renewable energy-related revenues. 

• Ensure that only qualified individuals serve as oil and gas inspectors under 

strict ethical standards. 

• Create a training academy for federal oil and gas inspectors. 

Improve the Federal Offshore Leasing Program’s Safety & Environmental 

Protections 

• Eliminate the use of Categorical Exclusions under NEPA to approve exploration 

or development plans. 

• Require the inclusion of meaningful blowout and worst-case scenario response 

plans in all drilling plans. 

• Require applicants to have technology that is demonstrated to be able to respond to a worst-case release of oil. 

• Ensure compliance with environmental and natural resource conservation laws. 

• Extend the 30-day deadline for the review of exploration plans to 90 days. 

• Require monthly inspections of all drilling rigs. 

Create a Robust Planning Process for Energy Development on the Outer 

Continental Shelf 

• Establish regional ocean councils for the Atlantic, Pacific, Gulf of Mexico, and 

Alaska regions, which would prepare marine spatial strategic plans to guide 

OCS energy development. 

• Direct 10% of OCS revenues into a new Ocean Resources Conservation and 

Assistance (ORCA) Fund, which would be used to protect, maintain, and restore 

ocean, coastal, and Great Lakes ecosystems. 

• Increase the involvement of NOAA in the oversight of offshore drilling 

activities. 

Improve Federal Onshore Energy Leasing Programs 

• Require federal oil and gas lessees to diligently develop their leases. 

• Repeal Section 390 of the Energy Policy Act of 2005 relating to categorical 

exclusions. 

• Impose ‘‘best management practices’’ on oil and gas lessees to ensure they operate in an environmentally sustainable manner. 

• Establish a competitive wind and solar leasing program for Federal lands, while 

allowing non-competitive leases for research and testing. 

Improve the Federal Oil and Gas Royalty Collection Program 

• Permanently end the Royalty-In-Kind program, which was the source of a major 

scandal regarding overly-cozy relationships between private industry and 

government regulators. 

• Eliminate the practice of paying interest to oil and gas companies when they 

overpay royalties. 

• Enhance the ability of the government to go after oil and gas lessees that 

chronically or intentionally shortchange the American people of their rightful 

royalties. 

• Repeal unnecessary royalty relief provisions. 

116 

Fully Fund the Land and Water Conservation Fund, the Historic Preservation Fund and the Oceans Resources Conservation and Assistance Fund 

• Provide mandatory full funding, beginning in 2011, for the Land and Water 

Conservation Fund (LWCF), the Historic Preservation Fund (HPF), and the 

Oceans Resources Conservation and Assistance Fund (ORCA). 

• Assess a conservation fee on existing leases that are producing oil or gas from 

2011 through 2021 to pay for full funding of the LWCF, the HPF, and the 

ORCA. 

Establish a Restoration Planning Program for the Gulf of Mexico 

• Establish a Gulf of Mexico Restoration Planning Program to ensure that 

Federal and State restoration efforts are coordinated and based on the best 

available science to achieve the maximum restoration benefits for species, habitats and communities in the Gulf. 

• Establish a long term monitoring and research program to ensure the impacts 

of the spill on the marine and coastal environment are fully documented, 

understood, and mitigated. 

• Establish an emergency habitat restoration and establishment program to 

ensure that species that migrate through the Gulf, particularly waterfowl and 

other birds, have habitat available outside the areas impacted by the spill. 

[A letter submitted for the record by Pat Sweeney, Director, 

Western Organization of Resource Councils, follows:] 

WORC 

Western Organization of Resource Councils 

110 Maryland Avenue, NE, Suite 306, Washington, DC 20002 

(202) 547–7040 FAX (202) 543–0978 

E-mail: dc@worc.org http://www.worc.org 

June 29, 2010 

The Honorable Nick Rahall, II 

Chairman 

House Committee on Natural Resources 

1324 Longworth House Office Building 

United States House of Representatives 

Washington, DC 20510 

Dear Chairman Rahall, 

I am writing to express the support of WORC and its members for your bill, the 

Consolidated Land, Energy, and Aquatic Resources Act of 2009, H.R. 3534. WORC 

agrees that reforms are needed to ensure that our federal energy resources are managed in a safe and fiscally-sound manner, particularly in the areas of onshore oil 

and gas development. Please include this letter of support in the Natural Resource 

Committee’s June 30, 2010 hearing record. 

As you know, many of WORC’s members are farmers, ranchers and other rural 

landowners who are directly affected by the development of federal energy resources. We are not opposed to energy development, but we believe that changes are 

needed to defuse the controversies surrounding irresponsible oil and gas development. 

We urge you to include further protections for surface owners over federal oil and 

gas reserves, and repeal of the categorical exclusions from environmental review 

created by the Energy Policy Act of 2005. The CLEAR Act with these additions will 

provide badly needed changes to planning, leasing and development of onshore federal oil and gas resources. 

The Gulf disaster has focused the nation’s attention on the dangers of offshore 

drilling, yet many of the same risks apply to onshore oil and gas drilling, particularly in the case of federal minerals: 

• The Bureau of Land Management (BLM) has multiple, often conflicting responsibilities including land use planning, environmental review, leasing, revenue 

collection, permitting, inspections, and enforcement. 

• Limited resources force trade offs between facilitating development, protecting 

multiple uses, exercising oversight, and protecting the interests of taxpayers. 

117 

• Use of toxic chemicals poses risks to health, safety and the environment, yet 

the oil and gas industry is exempted from many environmental standards with 

which other industries must comply. 

• People living in affected communities don’t have the information they need to 

test their air or water for pollutants because little, if any, information about 

toxic chemicals used is made available to the public. 

• The people who rely on the land, air and water bear the brunt of the impacts, 

but have little or no ability to ensure responsible development. Onshore, this 

is often farmers and ranchers, who own the land above federal oil and gas. 

• Corporate liability is limited: In the case of onshore drilling, bonding requirements are 50 years out-of-date, putting taxpayers and landowners at risk for 

the cost of cleanups. 

Your bill includes common sense reforms that would address many of these critical issues, and help ensure that an appropriate balance is struck between developing our important federal oil and gas resources and protecting drinking water, air 

quality, agricultural lands, wildlife habitat, and the health of communities. 

These provisions from Title II, Subtitle B are of particular importance to WORC: 

Bonding and Reclamation 

Sec. 227 requires complete and timely reclamation of lease tracts, and restoration 

of any adversely affected lands or surface waters, through Interim and Final Reclamation plans that restore oil and gas sites to a condition approximate or equal 

to that which existed prior to the surface disturbance, including restoration of natural vegetation and hydrology, habitat restoration, salvage, storage and reuse of topsoils, control of erosion, invasive species and noxious weeds, and natural contouring. 

Sec. 101(f)(6) requires reclamation bonds sufficient to assure the completion of reclamation if the work were to be performed by the Secretary in the event of forfeiture. This requirement will result in long-overdue updates to BLM’s fifty-year-old 

onshore oil and gas bonding standards, which have been repeatedly criticized by the 

Government Accountability Office and others. 

Chemical Disclosure 

Sec. 229 requires public disclosure of the often-toxic chemicals used in drilling and 

completion of oil and gas wells on federal leases, giving people living near oil and 

gas sites the information they need to test their drinking water supplies and protect 

their families. 

Best Management Practices 

Sec. 226 requires the use of safety and environmental standards (now voluntary) 

to ensure the sound, efficient, and environmentally responsible development of oil 

and gas in a manner that avoids, minimizes, and mitigates actual and anticipated 

impacts from oil and gas development. 

In addition, we urge inclusion of the following: 

Protections for Surface Owners 

As you know, millions of acres of federal oil and gas lie beneath private land. 

Under current law, the Stockraising Homestead Act of 1916, landowners have limited rights to consultation and compensation, and face serious damages to their land 

and way of life. While Sec. 223 requires notification of surface owners in advance 

of leasing and permitting, additional protections are needed. We strongly urge you 

to include Sec. 221 of H.R. 2337 from the 110th Congress. 

End Categorical Exclusions 

‘‘Categorical exclusions’’ created by the Energy Policy Act of 2005 (EPAct) create 

a short cut to required environmental review and analysis for various types of oil 

and gas activities. We also urge inclusion of Sec. 308 of H.R. 3534 as introduced, 

which repeals Sec. 390 of EPAct. 

We thank you for your leadership on these critical issues, and look forward to 

working with you and your committee toward passage of the CLEAR Act. 

Sincerely, 

Pat Sweeney, Director 

Western Organization of Resource Councils 

118 

[A letter submitted for the record by the Theodore Roosevelt 

Conservation Partnership follows:] 

THEODORE ROOSEVELT CONSERVATION PARTNERSHIP 

555 11TH ST NW 

6TH FLOOR 

WASHINGTON, DC 20004 

202–639–8727 

WWW.TRCP.ORG 

June 30, 2010 

Honorable Nick J. Rahall II 

Chairman 

House Committee on Natural Resources 

1324 Longworth House Office Building 

Washington, DC 20515 

Honorable Doc Hastings 

Ranking Member 

House Committee on Natural Resources 

1203 Longworth House Office Building 

Washington, DC 20515 

Dear Chairman Rahall and Ranking Member Hastings: 

The hunting, fishing and conservation organizations listed below would like to 

thank you and other members of the House Committee on Natural Resources for 

addressing many of the concerns of sportsmen regarding the impacts of energy development on fish and wildlife in the discussion draft of the Amendment in the Nature of Substitute for the Consolidated Land, Energy and Aquatic Resources Act of 

2010 (H.R. 3534). 

We are pleased with the overall approach allowing pre-leasing analysis, evaluation of development plans before permitting and better coordination with federal 

and state agencies for offshore development. We also support this legislation addressing the deficiencies in policy and process that may have lead to the current 

problems in the Gulf of Mexico and the mitigation of impacts and restoration of 

habitats and values hurt by the BP spill. Specifically, we applaud the following provisions of H.R. 3534 and urge your continued support of these important points: 

1. Establishment of the independent Office of Environmental Science; 

2. Commitment to fully fund the Land and Water Conservation Fund at $900M 

without the need to go through annual appropriations; 

3. Establishment of a ‘‘due diligence’’ standard; 

4. Notification of affected stakeholders before leasing and development and the 

opportunity for public involvement in the process; 

5. Adjustments to the leasing process for onshore lease sales and making Best 

Management Practices mandatory; 

6. Inclusion of reclamation and wildlife sustainability planning, protection of corridors and more effective monitoring processes; 

7. Clear direction for coordination with other federal and state agencies; 

8. Requirement for disclosure of chemicals involved in energy development; 

9. Establishment of a leasing process for solar and wind development on federal 

lands; 

10. Establishment of the Ocean Resources Conservation and Assistance Fund; 

11. Establishment of liability for damages to national wildlife refuges; and 

12. Clarification that the changes contained will not affect states’ authority to 

manage fish and wildlife within their boundaries and their ability to manage 

hunting and fishing. 

We understand that in response to the tragedy in the Gulf, energy policy will be 

considered in the near future and we applaud the committee for beginning the process to address the needs of fish and wildlife in H.R. 3534. Please enter this letter 

into the official hearing record and contact any of the organizations listed below for 

assistance with issues involving fish and wildlife and energy development. 

Sincerely, 

Gordon Robertson 

American Sportfishing Association 

119 

Ralph Rogers 

North American Grouse Partnership 

Mike Schlegel 

Pope & Young Club 

Joe Hamilton 

Quality Deer Management Association 

Chris Wood 

Trout Unlimited 

Thomas M. Franklin 

Theodore Roosevelt Conservation Partnership 

Bruce Leopold 

The Wildlife Society 

Gray Thornton 

Wild Sheep Foundation 

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