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77–922 2013

THE ROLE OF THE INTERIOR DEPARTMENT IN 

THE DEEPWATER HORIZON DISASTER 

JOINT HEARING 

BEFORE THE

SUBCOMMITTEE ON OVERSIGHT AND 

INVESTIGATIONS 

AND THE

SUBCOMMITTEE ON ENERGY AND ENVIRONMENT 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

JULY 20, 2010 

Serial No. 111–145 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 


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COMMITTEE ON ENERGY AND COMMERCE 

HENRY A. WAXMAN, California, Chairman 

JOHN D. DINGELL, Michigan 

Chairman Emeritus 

EDWARD J. MARKEY, Massachusetts 

RICK BOUCHER, Virginia 

FRANK PALLONE, JR., New Jersey 

BART GORDON, Tennessee 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

BART STUPAK, Michigan 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

Vice Chairman 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANE HARMAN, California 

TOM ALLEN, Maine 

JAN SCHAKOWSKY, Illinois 

HILDA L. SOLIS, California 

CHARLES A. GONZALEZ, Texas 

JAY INSLEE, Washington 

TAMMY BALDWIN, Wisconsin 

MIKE ROSS, Arkansas 

ANTHONY D. WEINER, New York 

JIM MATHESON, Utah 

G.K. BUTTERFIELD, North Carolina 

CHARLIE MELANCON, Louisiana 

JOHN BARROW, Georgia 

BARON P. HILL, Indiana 

DORIS O. MATSUI, California 

DONNA M. CHRISTENSEN, Virgin Islands 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

CHRISTOPHER S. MURPHY, Connecticut 

ZACHARY T. SPACE, Ohio 

JERRY MCNERNEY, California 

BETTY SUTTON, Ohio 

BRUCE L. BRALEY, Iowa 

PETER WELCH, Vermont 

JOE BARTON, Texas 

Ranking Member 

RALPH M. HALL, Texas 

FRED UPTON, Michigan 

CLIFF STEARNS, Florida 

NATHAN DEAL, Georgia 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOHN B. SHADEGG, Arizona 

ROY BLUNT, Missouri 

STEVE BUYER, Indiana 

GEORGE RADANOVICH, California 

JOSEPH R. PITTS, Pennsylvania 

MARY BONO MACK, California 

GREG WALDEN, Oregon 

LEE TERRY, Nebraska 

MIKE ROGERS, Michigan 

SUE WILKINS MYRICK, North Carolina 

JOHN SULLIVAN, Oklahoma 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

PHIL GINGREY, Georgia 

STEVE SCALISE, Louisiana 

PARKER GRIFFITH, Alabama 

ROBERT E. LATTA, Ohio 


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SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

BART STUPAK, Michigan, Chairman 

BRUCE L. BRALEY, Iowa 

Vice Chairman 

EDWARD J. MARKEY, Massachusetts 

DIANA DEGETTE, Colorado 

MIKE DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

MIKE ROSS, Arkansas 

DONNA M. CHRISTENSEN, Virgin Islands 

PETER WELCH, Vermont 

GENE GREEN, Texas 

BETTY SUTTON, Ohio 

JOHN D. DINGELL, Michigan (ex officio) 

GREG WALDEN, Oregon 

Ranking Member 

ED WHITFIELD, Kentucky 

MIKE FERGUSON, New Jersey 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

EDWARD J. MARKEY, Massachusetts, Chairman 

MICHAEL F. DOYLE, Pennsylvania 

JAY INSLEE, Washington 

G.K. BUTTERFIELD, North Carolina 

CHARLIE MELANCON, Louisiana 

BARON P. HILL, Indiana 

DORIS O. MATSUI, California 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

JOHN D. DINGELL, Michigan 

RICK BOUCHER, Virginia 

FRANK PALLONE, JR., New Jersey 

ELIOT ENGEL, New York 

GENE GREEN, Texas 

LOIS CAPPS, California 

JANE HARMAN, California 

CHARLES A. GONZALEZ, Texas 

TAMMY BALDWIN, Wisconsin 

MIKE ROSS, Arkansas 

JIM MATHESON, Utah 

JOHN BARROW, Georgia 

RALPH M. HALL, Texas 

FRED UPTON, Michigan 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOHN B. SHADEGG, Arizona 

STEVE BUYER, Indiana 

GREG WALDEN, Oregon 

SUE WILKINS MYRICK, North Carolina 

JOHN SULLIVAN, Oklahoma 

MICHAEL C. BURGESS, Texas 


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C O N T E N T S 

Page 

Hon. Bart Stupak, a Representative in Congress from the State of Michigan, 

opening statement ................................................................................................ 1 

Prepared statement .......................................................................................... 4 

Hon. Michael C. Burgess, a Representative in Congress from the State of 

Texas, opening statement .................................................................................... 6 

Prepared statement .......................................................................................... 9 

Hon. Edward J. Markey, a Representative in Congress from the Commonwealth of Massachusetts, opening statement .................................................... 15 

Hon. Fred Upton, a Representative in Congress from the State of Michigan, 

opening statement ................................................................................................ 16 

Hon. Henry A. Waxman, a Representative in Congress from the State of 

California, opening statement ............................................................................. 17 

Prepared statement .......................................................................................... 19 

Hon. Joe Barton, a Representative in Congress from the State of Texas, 

prepared statement .............................................................................................. 21 

Prepared statement .......................................................................................... 23 

Hon. John D. Dingell, a Representative in Congress from the State of Michigan, opening statement ....................................................................................... 29 

Hon. Ed Whitfield, a Representative in Congress from the Commonwealth 

of Kentucky, opening statement ......................................................................... 30 

Hon. Diana DeGette, a Representative in Congress from the State of Colorado, opening statement ...................................................................................... 31 

Hon. John Shimkus, a Representative in Congress from the State of Illinois, 

opening statement ................................................................................................ 31 

Hon. Jerry McNerney, a Representative in Congress from the State of California, opening statement .................................................................................... 32 

Hon. Parker Griffith, a Representative in Congress from the State of Alabama, opening statement .................................................................................... 32 

Hon. Gene Green, a Representative in Congress from the State of Texas, 

opening statement ................................................................................................ 33 

Hon. Robert E. Latta, a Representative in Congress from the State of Ohio, 

opening statement ................................................................................................ 34 

Prepared statement .......................................................................................... 36 

Hon. Michael F. Doyle, a Representative in Congress from the Commonwealth 

of Pennsylvania, opening statement ................................................................... 38 

Hon. Phil Gingrey, a Representative in Congress from the State of Georgia, 

opening statement ................................................................................................ 39 

Hon. Lois Capps, a Representative in Congress from the State of California, 

opening statement ................................................................................................ 39 

Hon. Joseph R. Pitts, a Representative in Congress from the Commonwealth 

of Pennsylvania, opening statement ................................................................... 40 

Hon. Charlie Melancon, a Representative in Congress from the State of Louisiana, opening statement ................................................................................... 41 

Hon. John Sullivan, a Representative in Congress from the State of Oklahoma, opening statement .................................................................................... 42 

Hon. Jane Harman, a Representative in Congress from the State of California, opening statement .................................................................................... 43 

Hon. Ralph M. Hall, a Representative in Congress from the State of Texas, 

opening statement ................................................................................................ 43 

Hon. G.K. Butterfield, a Representative in Congress from the State of North 

Carolina, opening statement ............................................................................... 44 

Hon. John B. Shadegg, a Representative in Congress from the State of Arizona, opening statement ...................................................................................... 45 


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VI 

Hon. Doris O. Matsui, a Representative in Congress from the State of California, opening statement .................................................................................... 46 

Hon. Marsha Blackburn, a Representative in Congress from the State of 

Tennessee, opening statement ............................................................................ 46 

Hon. Janice D. Schakowsky, a Representative in Congress from the State 

of Illinois, opening statement .............................................................................. 47 

Hon. Steve Scalise, a Representative in Congress from the State of Louisiana, 

opening statement ................................................................................................ 48 

Hon. Betty Sutton, a Representative in Congress from the State of Ohio, 

opening statement ................................................................................................ 49 

WITNESSES

Gale Norton, Secretary of the Interior, 2001–2006 ............................................... 50 

Prepared statement .......................................................................................... 53 

Dick Kempthorne, Secretary of the Interior, 2006–2009 ...................................... 60 

Prepared statement .......................................................................................... 63 

Ken Salazar, Secretary of the Interior ................................................................... 125 

Prepared statement .......................................................................................... 129 

SUBMITTED MATERIAL

Letter of September 9, 2008, from the United States Department of the 

Interior to Secretary Kempthorne ...................................................................... 178 

Article entitled, ‘‘Ban on deep-water drilling adds insult to injury,’’ by Bobby 

Jindal, Washington Post, July 17, 2010 ............................................................. 182 

Hearing memorandum, July 16, 2010 .................................................................... 184 

Report by Congressional Research Service, June 1, 2010 .................................... 188 


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THE ROLE OF THE INTERIOR DEPARTMENT 

IN THE DEEPWATER HORIZON DISASTER 

TUESDAY, JULY 20, 2010 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATION, 

JOINT WITH THE

SUBCOMMITTEE ON ENERGY AND ENVIRONMENT, 

COMMITTEE ON ENERGY AND COMMERCE, 

Washington, DC. 

The Subcommittees met, pursuant to call, at 10:00 a.m., in Room 

2123 of the Rayburn House Office Building, Hon. Bart Stupak 

[Chairman of the Subcommittee on Oversight and Investigations] 

presiding. 

Members present: Representatives Stupak, Markey, Green, 

DeGette, Capps, Doyle, Harman, Schakowsky, Gonzalez, Inslee, 

Butterfield, Melancon, Matsui, Christensen, McNerney, Sutton, 

Braley, Dingell, Waxman (ex officio), Burgess, Upton, Hall, 

Stearns, Whitfield, Shimkus, Shadegg, Pitts, Sullivan, Blackburn, 

Gingrey, Scalise, Griffith, Latta, and Barton (ex officio). 

Staff present: Phil Barnett, Staff Director; Bruce Wolpe, Senior 

Advisor; Michal Freedhoff, Counsel; Caitlin Haberman, Special Assistant; Dave Leviss, Chief Oversight Counsel; Meredith Fuchs, 

Chief Investigative Counsel; Alison Cassady, Professional Staff 

Member; Molly Gaston, Counsel; Scott Schloegel, Investigator; Ali 

Neubauer, Special Assistant; Karen Lightfoot, Communications Director, Senior Policy Advisor; Elizabeth Letter, Special Assistant; 

Mary Neumayr, Minority Counsel; Alan Slobodin, Minority Counsel; Peter Spencer, Minority Professional Staff; Kevin Kohl Minority Professional Staff; Garrett Golding, Minority Legislative Assistant; and Jeanne Neal, Minority Research Analyst. 

OPENING STATEMENT OF HON. BART STUPAK, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

Mr. STUPAK. This meeting will come to order. Today we have a 

joint hearing titled ‘‘The Role of the Interior Department in the 

Deepwater Horizon Disaster’’. This is a joint hearing before the 

Oversight and Investigation Subcommittee and the Energy and Environment Subcommittee. I will chair the first panel, and Chairman Markey will chair the second panel. We will now hear from 

members for their opening statements. The Chairman and the 

ranking members will be recognized for five minute openings. All 

other members will be recognized for two minute openings. I will 

begin. 


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Last week, for the first time in 87 days, we heard some encouraging news. Finally the flow of oil that has ravaged much of the 

Gulf of Mexico is temporarily under control. Despite our relief that 

the flow of oil has abated, the consequences of this spill continue 

to mount. 11 men lost their lives on the day the Deepwater Horizon 

drilling rig exploded. The four states that border the Gulf of Mexico 

have suffered terrible economic and environmental devastation. 

That is why we are continuing our investigation. This is the fourth 

hearing the Oversight and Investigation Subcommittee has held, 

and the eighth hearing overall in the Energy and Commerce Committee. 

Our first hearing exposed serious deficiencies involving the blowout preventer. This supposed failsafe had a dead battery, a leaking 

hydraulic system, an emergency switch which failed to activate, 

and dangerous modifications. Our second hearing was a field hearing in New Orleans, where we heard from the widows of two men 

who died on the Deepwater Horizon explosion, as well as shrimpers 

and other small business owners who have suffered from the environmental catastrophe that followed. Our third hearing identified 

five key well design decisions relating to casing and cementing that 

increased the risk of a blowout. BP made a series of poor judgments before the blowout. The company took one shortcut after another in order to save time and money, and when the blowout occurred, BP was horrifically unprepared to deal with the consequences. 

Today the Oversight and Investigation Subcommittee and the 

Energy and Environment Subcommittee are jointly holding this 

hearing to examine the conduct of the regulators who overseen— 

who have overseen oil and gas development in the Gulf of Mexico. 

There has been a pervasive failure by the regulators to take the actions necessary to protect safety and the environment. These failures to regulate happen at the time as Federal officials offered oil 

and gas companies new incentives to drill deeper and riskier 

waters in the Gulf of Mexico. The number of producing deep water 

wells increased from 65 in 1985 to more than 600 in 2009, but the 

number of Federal inspectors working for the Minerals Management Service, MMS, has not kept pace with the number and complexity of the wells and the distance inspectors must travel. MMS 

had 55 inspectors in 1985, and just 58 some 20 years later. Currently MMS has approximately 60 inspectors in the Gulf of Mexico 

to inspect almost 4,000 facilities. Inspection has not been a priority. 

The Department of Interior also backed off when the oil and gas 

industry objected to proposals to strengthen government regulations. Reports prepared for MMS in 2001, 2002 and 2003 recommended two blind-shear rams on blowout preventers and questioned the reliability of their backup systems. Yet regulations finalized in 2003 during Secretary Gale Norton’s tenure did not require 

a second blind-shear ram, backup systems on BOPs, or even testing 

of backup systems. 

The same rulemaking identified poor cementing practices as one 

of the main primary causes of sustained casing pressure on producing wells. But an oil and gas industry coalition opposed mandatory requirements, and the Department opted against any prescriptive cementing requirements. Some helpful changes were made by 


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Secretary Salazar and the Obama Administration. The abuse-prone 

royalty-in-kind program was phased out. New ethical standards 

were adopted, and stronger regulations were proposed. But these 

changes were more cosmetic than substantive. For the Deepwater 

Horizon and the BP well, it remained business as usual. 

I want to thank former Secretaries Norton and Kempthorne for 

appearing today. I hope they will address what went wrong under 

their tenure and what lessons can be learned. And I want to thank 

Secretary Salazar for appearing before the Committee. He has proposed and begun implementing many significant changes to the 

Minerals Management Service, now called the Bureau of Ocean Energy Management Regulation and Enforcement. I would like to 

hear more about what he has planned and how he will ensure that 

these changes make a real difference. 

I also want to extend my appreciation to Chairman Markey. Our 

Subcommittees have worked collaboratively throughout this investigation, and I thank him and Chairman Waxman for their leadership in this area, and with respect to the Blowout Prevention Act 

that we have reported out of committee last week. 

That concludes my opening statement. 

[The prepared statement of Mr. Stupak follows:] 


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Opening Statement 

Rep. Bart Stupak, Chairman 

Committee on Energy and Commerce 

Subcommittee on Oversight and Investigations 

"The Role of the Interior Department in the Deepwater Horizon Disaster" 

July 20, 2010 

Last week, for the first time in 87 days, we heard some encouraging news. Finally, the 

flow of oil that has ravaged much of the Gulf of Mexico is temporarily under control. 

Despite our relief that the flow of oil has abated, the consequences of the spill continue to 

mount. Eleven men lost their lives the day the Deepwater Horizon drilling rig exploded. The 

four states that border the Gulf of Mexico have suffered terrible economic and environmental 

devastation. 

That is why we are continuing our investigation. 

This is the fourth hearing that the Oversight & Investigations Subcommittee has held and 

the eighth hearing overall in the Energy and Commerce Committee. 

Our first hearing exposed serious deficiencies involving the blowout preventer. This 

supposed failsafe had a dead battery, a leaking hydraulic system, an emergency switch that failed 

to activate, and dangerous modifications. 

Our second hearing was a field hearing in New Orleans, where we heard from the 

widows of two men who died in the Deepwater Horizon explosion as well as shrimpers and other 

small business owners who have suffered from the environmental catastrophe that followed. 

Our third hearing identified five key well design decisions relating to casing and 

cementing that increased the risk of a blowout. BP made a series of poor judgments before the 

blowout. The company took one shortcut after another in order to save time and money. And 

when the blowout occurred, BP was horrifically unprepared to deal with the consequences. 

Today, the Oversight and Investigations Subcommittee and the Energy and Environment 

Subcommittee are jointly holding this hearing to examine the conduct of the regulators who have 

overseen oil and gas development in the Gulf of Mexico. 

There has been a pervasive failure by the regulators to take the actions necessary to 

protect safety and the environment. These failures to regulate happened at the same time as 

federal officials offered oil and gas companies new incentives to drill in deeper and riskier 

waters in the Gulf of Mexico. 

The number of producing deepwater wells increased from 65 in the 1985 to more than 

600 in 2009. But the number of federal inspectors working for Minerals Management Service 

(MMS) has not kept pace with the number and complexity of wells and the distance inspectors 

must travel. MMS had 55 inspectors in 1985 and just 58 some 20 years later. Currently, MMS 

has approximately 60 inspectors in the Gulf of Mexico region to inspect almost 4,000 facilities. 

Inspection has not been a priority. 

The Department of the Interior also backed off when oil and gas industry objected to 

proposals to strengthen government regulations. Reports prepared for MMS in 200 I, 2002, and 

2003 recommended two blind-shear rams on blowout preventers and questioned the reliability of 

their backup systems. Yet regulations finalized in 2003 during Secretary Gale Norton's tenure 

did not require a second blind-shear ram, backup systems on BOPs, or even testing of backup 

systems. 
5 


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That same rulemaking identified "poor cementing practices" as one of the "main primary 

causes" of sustained casing pressure on producing wells. But an oil and gas industry coalition 

opposed mandatory requirements and the Department opted against any prescriptive cementing 

requirements. 

Some helpful changes were made by Secretary Salazar and the Obama Administration. 

The abuse-prone royalty-in-kind program was phased out, new ethical standards were adopted, 

and stronger regulations were proposed. But these changes were more cosmetic than 

substantive. For the Deepwater Horizon and the BP well, it remained business as usual. 

I want to thank former Secretaries Norton and Kempthorne for appearing today. I hope 

they will address what went wrong under their tenure and what lessons can be learned. 

And I thank Secretary Salazar for appearing before the Committee. He has proposed -

and begun implementing - many significant changes to the Minerals Management Service, now 

called the Bureau of Ocean Energy Management, Regulation and Enforcement. I would like to 

hear more about what he has planned and how he will ensure that these changes make a real 

difference. 

I also want to extend my appreciation to Chairman Markey. Our subcommittees have 

worked collaboratively throughout this investigation and I thank him and Chairman Waxman for 

their leadership in this area and with respect to the Blowout Prevention Act of2010. 
6 

I next to turn Mr. Burgess, ranking member of the Oversight and 

Investigation Subcommittee for his opening statement. 

OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. BURGESS. Thank you, Mr. Chairman, and this is a day we 

have long awaited for. We finally get an opportunity to talk to Secretary Salazar about some of the issues that led up to the events 

surrounding the loss of the Deepwater Horizon. 

You know, early on in the tenure of this, in the month of May, 

we had the executives from BP, Transocean and Halliburton here 

at the table in front of us, and, just like you, I was dismayed by 

all the finger pointing I saw. In fact, it even rose to the level of 

the national consciousness, where Jay Leno referred to it in his 

opening monologue, and said, wasn’t that a disgrace, all those executives pointing the finger at each other? And he said, President 

Obama has had enough of it. He said, no more finger pointing, and 

then he promptly went out and blamed Bush for the whole problem. Well, that is where we are this morning. 

Well, this hearing does come at a critical time. I am grateful that 

we are able to refer to the oil discharging in the Gulf in the past 

tense. We hope that that stays in the past tense. We have had encouraging news that it seems under control. There are serious environmental and economic impacts to confront in the Gulf. BP caused 

the spill. Some of the damage relates directly, though, to the administration’s decision-making in the aftermath of the Deepwater 

Horizon explosion. 

Most significantly, as we convene this hearing and people continue to struggle mightily to clean up after the BP spill, the Department of Interior has made decision upon decision in recent 

weeks that we are told may kill upwards of 20,000 jobs in the Gulf 

Coast energy industry. Some of this new wave of economic destruction is already occurring. This is where we are hitting people when 

they are down and when they need it the least. The governor of 

Louisiana this past Saturday wrote a powerful op-ed in the ‘‘Washington Post’’, and Mr. Chairman, I would like to submit that for the 

record. In this editorial the governor describes what he sees as a 

determined effort by the Secretary of the Interior, the current Secretary of the Interior, to impose a second economic disaster on the 

people of Louisiana. This second economic disaster is one of the 

most pressing issues before us, but there are other questions concerning the Department of Interior’s decision-making that we must 

explore today. And the person most able to answer these questions 

and provide us the necessary documents is the current Secretary 

of the Interior, Ken Salazar, so I appreciate very much finally having an opportunity to ask Secretary Salazar about the Department’s role in handling of the Deepwater Horizon incident. 

I understand the majority wishes to use the rearview mirror as 

the examining lens to talk about this disaster. Chairman Markey 

has explained to me before the recess, this is so we might understand the totality of the Department’s contribution to the Deepwater Horizon disaster. For this reason we will hear this morning 

from two former Secretaries of the agency. Both, as it happens, are 

from the Bush Administration, and, in fact, we are only going to 


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question former Secretaries from the Bush Administration. We are 

not going back to question Secretaries from the Clinton Administration. But we do have with us this morning, we are grateful for 

the participation, the voluntary participation, I might add, of Gale 

Norton and Dirk Kempthorne. I look forward to their experience 

perspective, both as former Cabinet Secretaries and former State— 

elected State officials. But I question whether now, as private citizens, they can really provide the Committee information as full and 

complete as we could otherwise obtain through agency documents 

through the current Secretary of the Interior. 

Today Secretary Salazar will appear on a second panel. The fact 

that a sitting Cabinet member responsible for the critical decisionmaking in a time of crisis follows two Interior—past Interior Secretaries—I don’t think he is here. I don’t think he is listening to any 

of our opening statements, unless he is tuned in with rapt attention to C–SPAN, but he should be here. So, Mr. Secretary, Mr. 

Salazar, if you are watching on C–SPAN, please come to the Committee Room. We need you here. The American people need you 

here. The people of the Gulf Coast of Louisiana need you here. 

Oversight of the Executive Branch means oversight of the administration in power, not past administrations. Yet the fruits of the 

Committee’s Executive Branch oversight relating to Deepwater Horizon, that has been underwhelming, as far as the deliverables to 

date. Committee requests for documents from the Department of 

Interior have amounted to some 2,000 pages. A few e-mails, internal memoranda, and other information. I hope we press for more 

cooperation, Mr. Chairman. By contrast, majority, with minority 

support, has effectively and aggressively investigated the companies associated with the disaster, some 120,000 pages of documents, all in the middle of one of the largest cleanup operations. 

This is asymmetric oversight, and it inhibits the Committee’s ability to get the full facts and circumstances behind this disaster. It 

inhibits our ability to understand fully current and ongoing actions 

by this administration in responding to this oil spill. 

The majority tries to trace the Deepwater Horizon back to the 

Bush Administration, and has technical regulatory issues in his 

hearing memo to imply that the blowup protector and cementing 

problems can be traced to that administration. But the majority 

knows all available evidence suggests the disaster resulted from 

the failure to follow existing regulations and best industry practices, not that George W. Bush prevented a second set of shear 

arms. And, in fact, when we heard from the two ladies who lost 

husbands on the Deepwater Horizon, which you referenced in your 

opening statement, they said, we don’t need more regulations, but 

we do need someone to oversee and insist that the regulations that 

are already in place are, in fact, followed. 

The fact remains it was under Secretary Salazar that BP’s initial 

exploration plan was reviewed and approved by the Minerals Management Service. It was under this administration that BP’s permit 

to drill the well was granted, and all the inspections of the operation and procedures were approved leading up to the explosion. 

We now observe the Secretary making decisions to restructure the 

agency in the middle of an environmental crisis. So we had a single 


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spinal cord response—a single spinal cord synapse, when really we 

should have cortical centers representing management evaluation. 

Mr. STUPAK. Finish up. 

Mr. BURGESS. How have these actions affected the ability of the 

Department to conduct its ongoing work and respond fully and effectively to the crisis? Do they inhibit the Secretary to ensure safe 

well drilling operations? We also see the Secretary appears to ignore—— 

Mr. STUPAK. Mr. Burgess, I am going to have ask you to finish— 

please. 

Mr. BURGESS. —State and local officials. Because of the time it 

has taken to get the Secretary of the Interior here, Mr. Chairman, 

I beg your indulgence to let me conclude. 

Mr. STUPAK. Well, Mr. Burgess, we have got a large group here. 

We are not going to let everyone go over time limits now. You are 

already a minute and a half over. I ask you to finish. 

Mr. BURGESS. The question we need to answer is what is going 

on in the—at the Department of Interior now really based on sound 

agency safety analysis, given what we know about offshore safety 

experience? Certainly we should try to gather information on past 

actions and decisions by the Department and—that have contributed to the current response problems. I would like to understand 

whether the companies—the oil companies had to rely on faulty 

government computer models and what the Secretary plans to do 

about improving those models. But we should not focus on the 

past—— 

Mr. STUPAK. Mr. Burgess, I am going to ask you to stop now. 

Mr. BURGESS [continuing]. Our most important activities happening right now by this administration during this crisis. Thank 

you, Mr. Chairman. I will—— 

[The prepared statement of Mr. Burgess follows:] 


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Opening Statement of the Honorable Michael Bnrgess 

Ranking Member, Subcommittee on Oversight and Investigations 

The Role of the Interior Department in 

The Deepwater Horizon Disaster 

July 20, 2010 

Thank you Mr. Chairman. This hearing comes at a very critical time 

in the Gulf Coast disaster. While we have good and encouraging news that 

the gusher at the BP well finally seems under control, we still have serious 

environmental and economic impacts to confront. BP caused the spill, but 

some ofthis damage relates directly to the Administration's decision-making 

in the aftermath of the Deepwater Horizon explosion. 

Most significantly, as we convene this hearing and people continue to 

struggle mightily to clean up the mess from the BP spill, the Department of 

the Interior has made decision upon decision in recent weeks that we are told 

may kill upwards of 20,000 jobs in the Gulf Coast energy industry. Some of 

this new wave of economic destruction is already occurring. Talk about 

hitting people when they are down and most in need. 

The Governor of Louisiana just this past Saturday wrote a powerful 

editorial in The Washington Post, which I would like to submit for the 
10 


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record. In this editorial, the Governor describes what he sees as a 

determined effort by the Secretary of Interior to impose a second economic 

disaster on the people of Louisiana .. 

This second economic disaster is one of the most pressing issues 

before us, but there are other questions concerning the Department of the 

Interior's decision-making that we must explore today. And the person most 

able to answer these questions or provide us with the necessary documents is 

the sitting Secretary of the Interior, the Honorable Ken Salazar. So I 

appreciate very much finally having an opportunity to ask Secretary Salazar 

about the Department's role in and handling of the Deepwater Horizon 

incident. 

I understand the Majority wishes to look backward to have a historical 

perspective. Chairman Markey has explained to me before the recess that 

this is so we might understand the totality of the Depmiment's contribution 

to the Deepwater Horizon disaster. For this reason, we will hear this 

morning from two former Secretaries of the agency, both as it happens from 

the Bush Administration and only the Bush Administration, the Honorable 

Gale Norton and the Honorable Dirk Kempthorne. 

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I look forward to their experienced perspective - both as fonner 

Cabinet Secretaries and fonner elected state officials - but I question 

whether they, now private citizens, can really provide the Committee 

infonnation as full and complete as what we could otherwise obtain through 

agency documents from the current Secretary of the Interior. 

Today, Secretary Salazar will appear on a second panel. The fact that 

a sitting Cabinet member - responsible for critical decision-making in a time 

of crisis -- has to follow past Interior Secretaries increases my concerns 

about the seriousness of the Majority's interest in current Administration 

decision-making. Given this is a joint hearing, by the time we get through 

statements and questioning of the first panel, we may not have full and fair 

opportunity to question the current Secretary before he has to leave. He is 

not even present yet to hear our statements. 

Oversight of the Executive Branch means oversight of the 

Administration in power, not past Administrations. Yet the fruits of the 

Committee's Executive Branch oversight relating to the Deepwater Horizon 

disaster has been underwhelming to date. Committee requests for documents 

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to the Department of Interior have so far amounted to a sum total of 2,036 

pages - with few emails, internal memoranda, or any other information 

essential for effective oversight. I hope we press for more cooperation from 

agency, Mr. Chairman. 

By contrast, the Majority, with Minority support, has been effectively 

aggressive investigating the companies associated with the disasterproducing something on the order of 120,000 pages of documents, all in the 

middle of one of the largest oil-spill cleanup operations. 

This asymmetrical oversight inhibits the Committee's ability to get 

the full facts and circumstances behind the Deepwater Horizon disaster. It 

also inhibits our ability to understand fully current and ongoing actions by 

the Administration in responding to the oil spill. 

The Majority tries to trace the Deepwater Horizon spill to the Bush 

Administration, and has raised technical regulatory issues in its hearing memo 

to imply BOP and cementing problems can be traced to this time-period. But 

the Majority knows all available evidence suggests the disaster resulted from 

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the failure to follow existing regulations and industry best practices, not that 

George W. Bush refused to require two sets of blind shear rams. 

The fact remains: it was under Secretary Salazar that BP's Initial 

Exploration plan was reviewed and approved by the Minerals Management 

Service. It was under this Administration that BP's permit to drill the well 

was granted, and all the inspections of the operation and procedures were 

approved leading up to the explosion. 

We now observe the Secretary making decisions to restructure the 

agency in the middle of an environmental and economic crisis. Are these 

actions seat-of-the pants decision-making, or do they represent considered 

management evaluation? How have these actions affected the ability of the 

department to conduct its on-going work and respond fully and effectively to 

the crisis? Do they inhibit the ability of the Secretary to ensure safe well 

drilling operations? 

We also see that the Secretary appears to ignore the objections of state 

and local officials in areas hit the hardest by the spill and impose what he 

acknowledges is economically damaging moratoria. What is behind the 

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Secretary's decision? Is it really based on sound agency safety analysis, 

given what we know about offshore safety experience? 

We should certainly try to gather infonnation on past actions and 

decisions by the Department that contributed to the cunent response 

problems. I would like to understand whether the oil companies have had to 

rely upon faulty government computer models and what the Secretary plans 

to do about improving those models. 

But we should not use a focus on the past to obscure our focus on the 

most important activities happening right now, by this Administration, 

during this cunent oil spill response. 

Thank you, Mr. Chainnan. 

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15 

Mr. STUPAK. Mr. Burgess, you asked for understanding. I am 

going to ask for your understanding. We are going to keep strict 

time limits today. We have two committees. We have got a full 

panel here. We are going to observe the time limits, OK? That goes 

for everybody. Mr. Markey, your opening statement, please. 

OPENING STATEMENT OF HON. EDWARD J. MARKEY, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH 

OF MASSACHUSETTS 

Mr. MARKEY. All right. Thank you, Mr. Chairman. I thank you 

for your leadership, and Chairman Waxman’s leadership upon this 

issue. I do believe that President Obama is wise in the maintenance of his moratorium in ultra-deep waters. If we are going to 

drill in ultra-deep waters, we should ensure that it is ultra-safe, 

and in the event of an accident, that a response would be ultrafast. Right now we are not sure that that is the case. That is why 

the President is wise. 

Oil is not the result of spontaneous generation. The conditions 

for its creation are set millions of years before. Organisms die and 

decay. Heat, pressure and time do the rest. Just as with the slow 

creation of fossil fuels, the condition that created the BP disaster 

in the Gulf were put in motion many years ago. Increasing pressure from the oil industry to relax regulations, and the willingness 

of regulators to take the heat off companies did the rest. 10 years 

before BP oil spill, in January of 2000, a directive issued by the Department of Interior under the Clinton Administration stated that 

the methods used to model spills ‘‘are not adequate to predict the 

behavior of spills in deep water’’, and that a new model would be 

required. Unfortunately, this never happened. The Bush Administration never followed through. 

Nine years and three months before the BP oil spill, just two 

weeks after taking office, President Bush created the Cheney Energy Task Force. The task force met in secret, largely with representatives of the oil, gas and other energy industries. A little less 

than nine years before the spill, on May 16, 2001, the Cheney Energy Task Force submitted its report. The report asserts that exploration and production from the outer continental shelf has an impressive environmental record. The report further states that existing laws and regulations were creating delays and uncertainties 

that can hinder proper energy exploration and production projects. 

We are warned that substantial economic risks remain to investment in deep water, and that the Interior Department must therefore be directed to consider economic incentives for environmentally 

sound offshore oil and gas development. With the Cheney Task 

Force report, the first condition for this disaster, rewriting the offshore drilling policies to prioritize speed rather than safety, was set 

in motion. 

Eight years before the spill the Interior Department began 

issuing regulations that would extend and ultimately expand the 

royalty-free drilling given to oil companies for offshore oil and gas 

production. But financial incentives weren’t enough, so the Bush 

Administration’s Interior Department made the choice to assert 

that a catastrophic spill could not occur. 


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Seven years before the spill the Bush Administration exempted 

most Gulf of Mexico lease holders from having to include blowout 

scenarios in their oil and gas exploration or production plans. Oil 

companies were also no longer required to say how long it would 

take to drill a relief well, and how a blowout could be contained by 

capping the well. BP therefore included no such information in its 

plans for the Deepwater Horizon well. 

Three years to the month before this spill, in April of 2007, the 

environmental impact statement approved by the Bush Administration for drilling in the Gulf of Mexico said that since blowouts 

are ‘‘rare events and of short duration’’, the potential impacts to 

marine water quality ‘‘are not expected to be significant.’’ The analysis concluded that the most likely size of a large oil spill would 

be a total of 4,600 barrels, and that ‘‘a sub-surface blowout would 

have a negligible impact on Gulf of Mexico fish resources or commercial fishing.’’ A few months later in 2007, in the Bush Administration’s Interior Department, it completed another environmental 

review and issued ‘‘a finding of no new significant impact.’’ No further environmental review was needed, according to the Bush Administration. 

On April 20, 2010 the regulatory house of cards erected over an 

eight year period by the Bush/Cheney Administration collapsed 

with the explosion on the BP Deepwater Horizon rig. Today we will 

hear from the nation’s last three Secretaries of Interior, who have 

presided over our nation’s leasing of offshore oil and gas since January 2001. I welcome the Secretaries, and we look forward to their 

testimony. 

Mr. STUPAK. Thank you, Mr. Markey. Mr. Upton, opening statement, 5 minutes. 

OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

Mr. UPTON. Thank you, Mr. Chairman. What happened on the 

Deepwater Horizon rig was truly a national tragedy. We all hope 

that the recently installed well cap will hold and not an ounce of 

oil will leak from that well ever again. Once this happens, our 

focus needs to shift to the cleanup and getting folks back to work. 

Citizens of the Gulf are facing unprecedented hardships. They don’t 

need to be further burdened by job killing policies being pushed by 

the Congress or the administration. 

Of course, we do want answers. We want all the answers. We 

must work to ensure a disaster like this never happens again. 

Since that rig exploded, and as millions of gallons of oil leaked into 

the Gulf, our economy and our national security posture has been 

weakened. A joint investigation of the causes of the Deepwater Horizon blowout explosion and spill are currently being conducted by 

the Coast Guard and MMS. In addition, President Obama announced a presidential commission that will investigate and report. 

The team of engineers tapped by Secretary Salazar to examine 

what went wrong on the Horizon rig recently wrote, ‘‘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 


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17 

and no environmental impacts offshore ever. However, we must understand that, as with any human endeavor, there will always be 

risks.’’ Secretary Salazar pointed to this team of engineers to rationalize the moratorium. Not only did the engineers disagree, so 

did the courts. The court has overturned the Salazar drilling moratorium a number of times. 

The Gulf accounts for nearly a third of the United States’ oil production. Knee jerk reactions and finger pointing won’t make drilling any safer, and certainly isn’t productive for the citizens of the 

Gulf. Let us learn from this awful mistake, fix the problem, clean 

up the Gulf, and move forward to fix our ailing economy and create 

private sector jobs. 

I yield back. 

Mr. STUPAK. Thank you, Mr. Upton. Mr. Chairman—Chairman 

Waxman for an opening statement, please. 

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Mr. WAXMAN. Thank you very much, Chairman Stupak and 

Chairman Markey, for holding this joint Subcommittee hearing. I 

think it is an important hearing. During the last three months 

since the Deepwater Horizon explosion and blowout this committee, 

and its subcommittees, has held seven hearings, and those hearings have focused on the actions of BP and other oil and gas companies, and we learned that BP repeatedly made dangerous choices 

to save time and money. Transocean’s blowout preventer had a 

dead battery, a leaking hydraulic system, and other serious flaws. 

And we learned that the entire oil industry was unprepared to 

deal, and is unprepared to deal, with a significant blowout. 

Today we are going to examine the role of the regulators. We will 

learn that the Department of Interior under both President Bush 

and President Obama made serious mistakes. The cop on the beat 

was off duty for nearly a decade, and this gave rise to a dangerous 

culture of permissiveness. Secretary Salazar has testified before 

several committees, and we welcome his appearance today. What 

makes this hearing unique is that we will be hearing from two of 

his predecessors, former Secretary Gale Norton and former Secretary Dirk Kempthorne, and I welcome both of them to our committee. This will allow us to examine the recent history of Federal 

drilling regulation and look at it in a broader context. 

Mr. Markey pointed out, and he is right, in many ways this history begins with Vice President Cheney’s secretive energy task 

force. This was initiated during President Bush’s second week in office, and for weeks it met privately with oil and gas executives and 

other industry officials whose identity the administration steadfastly refused to disclose. Four months later the vice president released a report describing the new energy strategy for the administration. The report directed the Interior Department to ‘‘consider 

economic incentives for environmentally sound offshore oil and gas 

development’’. As recommended in the report, President Bush immediately issued an executive order to expedite projects that will 

increase the production of energy. 


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Secretary Norton led the implementation of the Bush strategy for 

the Department of Interior. She promoted new incentives and royalty programs to encourage drilling. But she failed to act on safety 

warnings about blowout preventers, and she rejected proposals to 

strengthen standards for cementing wells. Those decisions sent a 

clear message. The priority was more drilling first, and safety second. 

Secretary Norton left amid the scandals involving Jack Abramoff 

to work as general counsel for Shell, a major oil company. Her successor, Secretary Kempthorne, oversaw the lease sale to BP of the 

future Macondo well, and Secretary Kempthorne also oversaw the 

deeply flawed assessment of potential environmental impacts associated with this lease sale, an assessment that did not anticipate 

the possibility or impacts of a catastrophic sub-sea blowout. As a 

result of these environmental assessments, BP did not have to include an oil spill response discussion, a site specific oil spill response plan, or a blowout scenario in its explanation plan. In many 

ways Congress was complicit in its oversight. The Energy Policy 

Act of 2005 granted royalty relief and subsidies to the industry, but 

did not strengthen regulatory requirements. 

As a Democrat, I hoped the Obama Administration would do better, and in some ways there have been reforms. The scandal-ridden 

royalty-in-kind program was cancelled. Secretary Salazar instituted 

new ethics programs, and in the Department’s budget Secretary 

Salazar requested more inspectors for offshore facilities. But there 

is little evidence that these reforms changed the laissez-faire approach of MMS in regulating the BP well. MMS approved the drill 

plan and changes to the well design plan that we have questioned 

during our investigations. 

The April 20 blowout was a wakeup call for this administration, 

and for Congress. Secretary Salazar’s now reorganized MMS issued 

a 30 day safety report, developed a plan to implement the reorganization, and asked the Department IG to examine culpability and 

issue suspensions of new high risk activity until there is evidence 

that blowout preventers are safe enough and the oil industry is capable to respond to another spill. 

These actions are long overdue, but they are necessary steps in 

the effort to revitalize drilling regulation, and I welcome this 

chance to learn more about them. 

Chairman Stupak and Markey, thank you for holding the hearing, and I hope we can learn the extra part of our investigation as 

to what the regulators were doing during this 10-year period. Yield 

back my time. 

[The prepared statement of Mr. Waxman follows:] 


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HENRY WAXMAN. CAUFORNIA 

CHAInMAN 

ONE HUNDRED ELEVENTH CONGRESS 

~ong;re55 of tbe mnitdl ~tate5 

~OUSt of i\rptrstntlltibrs 

COMMITTEE ON ENERGY AND COMMERCE 

2125 RAYS\,..IHN HousE OrneE: BUilDING 

WASHINGTON, DC 20515-6115 

Statement of Rep. Henry A. Waxman 

Chairman, Committee on Energy and Commerce 

BARTON, 

RANK!NG MEMBER 

"The Role of the Interior Department in the Deepwater Horizon Disaster" 

Suhcommittee on Oversight and Investigations and the 

Subcommittee on Energy and Environment 

July 20, 2010 

Chairman Stupak and Chairman Markey, I want to thank you for holding today's hearing. 

In the three months since the Deepwater Horizon explosion and blowout, we have held 

seven hearings. These hearings have focused on the actions ofBP and other oil and gas 

companies. 

We learned that BP repeatedly made dangerous choices to save time and money. We 

learned that Transocean's blowout preventer had a dead battery, a leaking hydraulic system, and 

other serious flaws. And we learned that the entire oil industry is unprepared to deal with a 

significant blowout. 

Today, we will be examining the role of the regulator. 

We will learn that the Department ofInterior under both President Bush and President 

Obama made serious mistakes. The cop on the beat was otf-duty for nearly a decade, And this 

gave rise to a dangerous culture ofpennissiveness. 

Secretary Salazar has testified before several committees, and we welcome his 

appearance today. What makes this hearing unique is that we will also be hearing from his two 

predecessors, former Secretary Gale Norton and former Secretary Dirk Kempthorne. This will 

allow us to examine the recent history of federal drilling regulation, and we thank them for their 

cooperation. 

In many ways, this history begins with Vice President Cheney's secretive energy task 

force. The energy task force was initiated during President Bush's second week in office, and 

tor weeks it met privately with oil and gas executives and other energy industry officials, whose 

identity the Administration steadfastly refused to disclose. Four months later, the Vice President 

released a report describing the Administration's new energy strategy. The report directed the 

Interior Department to "consider economic incentives for environmentally sound offshore oil and 
20 


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gas development." As recommended in the report, President Bush immediately issued an 

executive order to "expedite projects that will increase the production ... of energy." 

Secretary Norton led implementation of the Bush energy policies at the Department of 

the Interior. She promoted new incentives and royalty programs to encourage drilling. But, she 

failed to act on safety warnings about blowout preventers. And she rejected proposals to 

strengthen standards for cementing wells. Those decisions sent a cIear message: the priority was 

more drilling first, safety second. 

Secretary Norton left amid the scandals involving Jack Abramoffto work as a general 

counsel for Shell, a major oil company. Her successor, Secretary Kempthorne, oversaw the 

Lease Sale to BP of the future Macondo well. Secretary Kempthorne also oversaw the deeply 

flawed assessment of potential environmental impacts associated with this lease sale, an 

assessment that did not anticipate the possibility or impacts of a catastrophic subsea blowout. As 

a result ofthose environmental assessments, BP did not have to include an oil spill response 

discussion, a site-specific oil spill response plan, or a blowout scenario in its exploration plan. 

During the Bush Administration, there were a series of ethical scandals at the 

Department. It appeared that the Minerals Management Service's (MMS) mission had become 

to serve the oil and gas industry by facilitating the expansion of deepwater drilling. 

In many ways, Congress was complicit in this lack of oversight. The Energy Policy Act 

of2005 granted royalty relief and subsidies to the industry, but did not strengthen regulatory 

requirements. 

As a Democrat, I hoped the Obama Administration would do better and, in some ways, 

there have been reforms. The scandal ridden royalty-in-kind program was cancelled. Secretary 

Salazar instituted new ethics programs. And in the Department's budget, Secretary Salazar 

requested more inspectors for offshore facilities. 

But there is little evidence that these reforms changed the laissez-faire approach ofMMS 

in regulating the BP well. MMS approved the drill plan and changes to the well design that we 

have questioned during our investigation. 

The April 20 blowout was a wake-up call for the Administration. Secretary Salazar has 

now reorganized MMS, issued a 30-day safety report, developed a plan to implement the 

reorganization, asked the Department's IG to examine culpability, and issued suspensions of new 

high-risk activity until there is evidence that blowout preventers are safe enough and the oil 

industry is able to respond to another spill. 

These actions are long overdue. But they are necessary steps in the effort to revitalize 

drilling regulation, and I welcome the chance to learn more about them. 

Chairman Stupak and Markey, thank you for holding today's hearing. 

2 
21 

Mr. STUPAK. Thank you, Mr. Chairman. Mr. Barton for an opening statement, please. 

OPENING STATEMENT OF HON. JOE BARTON, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. BARTON. Excuse me. Thank you both Chairmans, and Full 

Committee Chairman Waxman, for this hearing. I welcome our two 

former Cabinet Secretaries, who are both friends of mine. We appreciate you all voluntarily coming today. 

Three months ago today an explosion tore through the Deepwater Horizon drilling ship. It killed 11 men. It has filled great 

swaths of the Gulf of Mexico with crude oil. As the spreading spill 

has focused the nation’s attention on what we need to do to stop 

it and prevent it from—in the future, our job here in this committee has been to conduct a bipartisan investigation to identify 

what went wrong and try to figure out if there is a way that we 

can help prevent it from the future. 

Last Thursday the Full Committee put together some of the results of the fruits of our investigation to pass out the Blowout Prevention Act of 2010. This bill passed this committee 48–0 on a bipartisan basis. It will improve safety, it will protect the environment, and yet it will allow responsible drilling to go forward in the 

outer continental shelf. Having said that, we still have a lot of 

work to do. As has been pointed out, right now it appears that the 

leak has been stopped, but we certainly haven’t stopped the economic and environmental harm in the Gulf of Mexico. I believe that 

this Committee’s bipartisan oversight is providing the most powerful searchlight for getting to the truth so that we can address in 

the very near future what additional steps, in addition to the Blowout Prevention Act that we passed last week, need to be done to 

prevent this tragedy from ever happening again. We have found 

and spotlighted a number of disturbing BP decisions, in some cases 

non-decisions, that were made or not made at critical moments 

that, if they had been made differently, perhaps this accident may 

not have occurred. 

Having said that, we need to remember that the drilling in the 

outer continental shelf and Federal waters is a regulated Federal 

industry. And today, finally, we are going to begin to look at the 

role of the regulator in this case, the Department of the Interior. 

We are going to see if perhaps past decisions and current practices 

have led to the accident that we all wish had not occurred. We 

want to understand why the Department has allowed BP to do 

what it did. Was the Department really watching what was going 

on at the drilling operation? Keep in mind that the blowout preventer that failed on April the 20th passed inspection only two 

weeks before. 

Americans want to understand what the Obama Administration’s 

response to the oil spill was and is, both in terms of what it did 

not do to stop the spread of oil and what it is doing right now, apparently, to stop energy production. It was the Obama Administration, not the Bush Administration, that didn’t waive the Jones Act 

so that some of our foreign friends could bring in their oil spill 

equipment. It was the Obama Administration, not the Bush Administration, that wouldn’t waive certain environmental impact 


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studies so that our friends in Louisiana and Mississippi and Alabama could put up some berms that could have prevented the oil 

from reaching their beaches. It was the Obama Administration, not 

the Bush Administration, that made the decision not to transfer 

pre-position equipment in other parts of the country for oil spills 

to the Gulf of Mexico to help in this spill. It was Secretary Salazar, 

not Secretary Barton or Secretary Kempthorne, that either made 

or didn’t make those decisions. 

What we have right now is a worst case scenario. The folks that 

depend on their livelihood for tourism on the beaches of the Gulf 

are not having the tourists come because tourists are afraid that 

the beaches might be soiled. The people that depend on their livelihood for fishing and recreation in the Gulf are not allowed to fish 

or recreate in the Gulf, and the people who depend on their livelihoods by drilling and working on these offshore rigs and the service 

facilities that service them are out of work because they are shut 

down. So we kind of have a lose-lose-lose situation, Mr. Chairman. 

We hope in the very near future that we can put it together in a 

win-win-win situation. 

The majority has invited former Cabinet Secretaries Norton and 

Kempthorne today, and we thank them for voluntarily appearing, 

for the transparent purpose, in my opinion, of attempting to focus 

blame on the Bush Administration. But as I have pointed out, the 

decisions and the non-decisions that are being made and have not 

been made are not being made by these two individuals. They are 

being made by Secretary Salazar and President Obama. So I would 

hope that we will focus most of the attention in today’s hearing on 

the current Cabinet Secretary and not the past Cabinet Secretary. 

I see my time has expired, Mr. Chairman. I will put the rest of 

my statement into the record, but thank you for holding this hearing. 

[The prepared statement of Mr. Barton follows:] 


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Opening Statement of the Honorable Joe Barton 

Ranking Member, Committee on Energy and Commerce 

Joint Subcommittee on Oversight and Investigations and 

Energy and Environment Hearing 

"The Role of the Interior Department in the 

Deepwater Horizon Disaster" 

July 20, 2010 

Three months ago today, an explosion tore through the 

Deepwater Horizon drilling ship, killing eleven men and filling 

great swaths of the Gulf of Mexico with crude oil. As the 

spreading spill turned urgent and the response sputtered, our job 

here was to identify what was going wrong and how it could be 

avoided in the future. 

Last Thursday we put our knowledge to work by reporting 

out of Committee the forward-looking Blowout Prevention Act of 

2010. 
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We still have plenty of work to do. The leak may have 

stopped, but the economic and environmental harm to the Gulf 

Coast certainly have not. 

I believe bipartisan oversight provides the most powerful 

searchlight for getting to the truth so we can address problems, and 

I think that we've done a solid job to date. We have found, 

analyzed and spotlighted disturbing BP decisions made at critical 

moments in the days leading up to the disaster. 

Yet we should not forget that offshore drilling is a regulated 

industry, and today we look at the role ofthe regulator. We look at 

the Interior Department's contribution to the poor decisionmaking. 

I am sure many Americans want to understand why the 

Department allowed BP to operate as it did. Was the Department 

really watching what was going on at BP's drilling operation? 

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Americans also want to understand the federal government's 

response to the spill, both in terms of what it did not do to stop the 

spread of oil and what it is doing right now to stop energy 

production. We seem to be headed toward a worst-case result in 

which ruination is visited on both the families who fish the Gulf 

for a living and on those who man the rigs that extract energy from 

the seabed, and where every American who drives pays a premium 

for gasoline that increasingly comes from places like Venezuela 

and the Middle East. Some say that some day alternative energy 

will make fossil fuels unnecessary. Yes, but not today or 

tomorrow or in this decade. 

The Majority has invited former Secretaries Norton and 

Kempthorne here today for the transparent purpose of focusing 

blame on the Bush Administration instead of the Obama 

Administration. I'm ready to learn something from past agency 

Secretaries about past agency actions, but only Secretary Salazar 

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can explain the actions of his Department during the months 

immediately before and after the Deepwater Horizon catastrophe. 

He is the Secretary. The disaster occurred on his watch. His 

department's decisions are the ones at issue in the present case. 

President Obama has already accepted responsibility for the 

slow culture change at the Department of Interior. He said, "I 

absolutely take responsibility." Period. And we understand now 

that this Administration's priorities were not focused on the tough 

work of reforming oil industry oversight. 

The first department-wide order issued by Secretary Salazar, 

on March 11, 2009 - before approval of the Deepwater Horizon 

permit - was to place "production, development, and delivery of 

renewable energy" as top priorities of the Department. Where did 

improving oversight of the safety of offshore oil drilling fit in to 

the Administration's green energy agenda? 

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The Secretary then chose a person to head the Minerals 

Management Service with a priority to "promote clean energy," 

Not to improve the regulatory oversight of oil drilling safety. 

Now that the Deepwater Horizon has shaken up 

Administration priorities, we're seeing a rush in another direction. 

While Americans, including those on the Gulf Coast, struggle with 

a recession that produced 9.5 percent unemployment last month, 

the Administration has decided to threaten the jobs of tens of 

thousands of people along the Gulf Coast with a blanket 

moratorium on energy exploration. We're already hearing reports 

that since they are barred from exploring for American energy in 

American territory, drilling rig operators are already entering into 

long-term contracts in other countries. 

We want to figure out how to ensure that America can rely 

on its own energy supplies instead of oil from overseas, and do it 

safely and effectively for the good of the entire country. I look 

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forward to hearing from Secretary Salazar how about his recent 

decisions and whether he thinks risking short and long-term health 

of scores of communities is in the nation's interest. 

### 

6 
29 

Mr. STUPAK. Thank you, Mr. Barton. Chairman Dingell, opening 

statement, please, 5 minutes. 

OPENING STATEMENT OF HON. JOHN D. DINGELL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN 

Mr. DINGELL. Thank you, Mr. Chairman. I would like to welcome 

our two witnesses today to the Committee, Secretary Norton and 

Secretary Kempthorne. It is a pleasure to see two old friends here 

before the Committee. Thank you for being here. 

Chairman Stupak and Chairman Markey, I thank you for holding this hearing today. It is very important, and I think it is extremely important that we continue to hear about the real and serious problems that have come to light as a result of the disaster in 

the Gulf. As this Committee has heard before, I am author of both 

the National Environmental Policy Act and the Marine Mammal 

Protection Act. I view these laws as my children, and while they 

have grown up, I find I still need to defend them from time to time 

against failures of proper administration. NEPA is a fairly simple 

statute. It simply requires agencies to look before their—before 

they leap. 

Now, as a poor Polish lawyer from Detroit, I just don’t see how 

an agency can look before it leaps when it grants broad categorical 

exclusions. These broad categorical exclusions require very broad 

statutory response to a situation within the agency. In other words, 

the agency can’t simply go out and just say, well, we are going to 

give a relief from the statute. It has to make certain findings and 

do a large number of things, which I do not believe could be said 

were done in the instances before us. I am pleased that the legislation reported by the House Resources Committee effectively takes 

these categorical exclusions off the table, although I must repeat I 

do not believe that it is necessary to do so. 

It has become clear that the Minerals Management Services is 

a dysfunctional agency. It has been that over a goodly period of 

time, and remained so until this administration came in to commence a change after the disaster in the Gulf. And it is unfortunate that it took a massive calamity and a tragic loss of life to 

bring this about. An Inspector General report in 2008 implicated 

a dozen officials of criminal and unethical behavior. I am pleased 

that the legislation recently reported by the Committee on Natural 

Resources will codify the changes put in place by Secretary Salazar 

and does away with the Mineral Management Service. Time will 

only tell whether the changes have been enough, and I hope that 

they will, but I would observe that a lot will depend upon administration. 

As this Committee knows, BP in particular has a long history of 

cutting corners, and the testimony before us showed that to be the 

case. I know that you, Mr. Chairman Stupak, offered an amendment in the markup Blowout Prevention Act consideration last 

week to address whether or not permits could be granted to habitually bad actors. Regrettably, it was not agreed to. I am pleased 

that the Natural Resources Committee has adopted a similar 

amendment in their legislation by unanimous consent, and I hope 

that it will be included when the legislation reaches the floor. 


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This is not, and should not, be a partisan issue. I hope that none 

of my colleagues, and I hope the Congress, again, will not treat it 

in that fashion. This is simply an issue of where we need to find 

out what is going on and to commence to address the corrections 

that need to be made so that we may go forward with a sound energy policy, and also with proper protection for the environment. 

I would just like to mention my—to my two good friends, the Secretaries, that the refuge that you saw when you were—came up 

into Michigan to visit with us on the Detroit River now constitutes 

something close to 6,000 acres. The Canadians will shortly be coming in, and your good work is appreciated not only by this member 

of the Committee, but, very frankly, by the citizens in the area, so 

I hope you feel welcome here this morning. 

Mr. Chairman, I thank you for your courtesy. 

Mr. STUPAK. Thank you. Mr. Whitfield for an opening statement. 

Two minutes, please. 

OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF KENTUCKY 

Mr. WHITFIELD. Thank you, Mr. Chairman, and thank you, Secretary Norton, Secretary Kempthorne, for joining us today. I want 

to reiterate my agreement with Mr. Dingell that this should not be 

a partisan issue. And yet when I read the Democratic memorandum to the Democratic members of this committee, 10 out of 13 

pages referred to the Bush Administration and decisions that the 

Bush Administration had made and didn’t make. And there was an 

insinuation that the Bush Administration was responsible for the 

BP blowout. I think we do a disservice to the American people 

when we try to place blame on anyone when we don’t know the 

reason for this blowout. The report is not due for nine more 

months, and it is being investigated. And at the end of that investigation, hopefully we will know and be able to move constructively 

forward to solve the problem. 

There are many people throughout the United States and the 

world today that believe it is unsafe to drill offshore, and—on the 

outer continental shelf. And yet we know that the last major oil 

spill from a platform occurred in 1969, off the coast of Santa Barbara. There are 7,000 active leases in the Gulf today. There are 1.7 

million barrels of oil per day being produced. There are 602 active 

wells today. So it is not like it is inherently dangerous, but yet the 

loss of one life is too many. And I will also note that in former documents from the Department of Interior it states—stated that natural cracks in the sea bed causes more oil seepage, 150 times larger in volume, than oil spill due to outer continental shelf oil and 

gas activities. 

So I look forward to the testimony today, and hopefully, with 

their testimony and the testimony of experts in the report, we will 

know what actually happened at the BP site. Thank you. 

Mr. STUPAK. Thank you, Mr. Whitfield. Ms. DeGette, two minutes, opening statement, please. 


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OPENING STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF COLORADO 

Ms. DEGETTE. Thank you very much, Mr. Chairman,for holding 

this hearing. The former MMS, which is, as you said, now the Bureau of Ocean Energy Management Regulation and Enforcement, 

has been involved in all of these issues. They regulate and they 

oversee drilling activities, and it was their job in this case to monitor offshore drilling, inspect violations, and to collect royalty revenue. 

One of the things that really dismays me, having been in Congress now for a while, is how you can take an agency like this, that 

has been, frankly, having trouble for many years, and make it a 

partisan issue on both sides of the aisle. Because the truth is the 

MMS has been dysfunctional for many years. That is why I want 

to welcome both of the former Secretaries who are here today, in 

particular my friend Secretary Norton, who I have known for many 

years in Colorado. And also, why I look forward to listening to the 

testimony of another Coloradoan on our next panel, Mr. Salazar. 

Because until we get the full picture, we can’t completely revamp 

this agency. And until we revamp this agency, we can’t guarantee 

that we have appropriate regulatory oversight over this—over drilling. And until we can get appropriate regulatory oversight over 

drilling, we can’t be sure that we should be having safe deep water 

drilling, and that is the way it is. 

At this point the administration is trying to revamp the former 

MMS. They are eliminating conflicts of interest. They are eliminating the royalty-in-kind program, and they have hired Michael 

Bromwich to oversee this reorganization. Last we heard from him 

in the Natural Resources Committee, he was brand new on the job 

and didn’t have anything new to add. So these are all positive 

steps, but until we get the historical view of what happened with 

this agency, we won’t adequately be able to make it effective, and 

we won’t be adequately able to perform our regulatory functions. 

Thank you very much, Mr. Chairman. 

Mr. STUPAK. Thank you, Ms. DeGette. Mr. Shimkus, your opening statement, please? 

OPENING STATEMENT OF HON. JOHN SHIMKUS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS 

Mr. SHIMKUS. Thank you, Mr. Chairman, and Secretary Norton, 

Secretary Kempthorne, welcome. I wish Secretary Salazar would be 

listening to some of these opening statements. Our colleagues have 

been real involved with this, as you can imagine. He should be 

hearing these. I agree with my colleague, Dr. Burgess. 

Point one is, remember, the President announced expansion of oil 

and gas drilling in the OCS a week before the explosion. Point two, 

in the military there is a clear sign when a change of command occurs. The outgoing commander grabs a flag and hands it over to 

the incoming commander. And when that occurs, the mission 

changes from the outgoing commander to the incoming commander, 

and the incoming commander is responsible for all his unit does or 

fails to do. I think there is a lesson to be learned here, that there 

is going to be a time when this administration is going to have to 


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accept some responsibility. Maybe not all, but at least a smidgen, 

a little bit. They are going to have to say, yes, this did happen on 

our watch. Yes, we didn’t really reorganize MMS when we first got 

in. Yes, it took the disaster for us to do that. Yes, maybe we were 

too slow to deploy assets. I think it would help in a—in, really, a 

bipartisan manner that they accept a little bit. In the military, it 

happens day one, and as a Commander-in-Chief, you would think 

he would learn that. 

I will focus on a lot of things today, but in my remaining time, 

I just want to highlight three things. I am an avid Facebook guy, 

and I mentioned the moratorium, and the—and rigs being moved, 

and one of my opponents put on there, I will believe it when I see 

it. Well, Diamond Offshore Drilling, Incorporated announces relocation of deep water ocean confidence to the Congo. Three deep water 

drilling rigs to be moved from sites south of Cameron Parish. 

Brazil sees silver lining in BP spill, more rigs. If we don’t move 

carefully on this, we are going to increase our reliance on imported 

crude oil. 

Thank you, Mr. Chairman. I yield back my time. 

Mr. STUPAK. Thank you, Mr. Shimkus. Mr. Inslee for an opening 

statement, please. Two minutes. 

Mr. INSLEE. I will resume my time. Thank you, Mr. Chairman. 

Mr. STUPAK. OK. Mr. McNerney, opening statement, two minutes. 

OPENING STATEMENT OF HON. JERRY MCNERNEY, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Mr. MCNERNEY. Thank you, Mr. Chairman. I want to thank Secretary Norton, Secretary Kempthorne, for participating. It may not 

be an easy morning for you, and I appreciate that. 

The oil spill is clearly a tragedy, and there are no winners in this 

situation. But as tempting as it is to use this hearing as an opportunity for partisan finger pointing, our duty and responsibility is 

to identify the causes of the tragedy and put rules in place to prevent this sort of disaster from happening again in the future. 

I hope we can accomplish this here today, but the obvious fact 

is that once a deep water blowout takes place, a massive spill is 

inevitable. Of course, once a spill takes place, we need to have an 

effective plan to quickly stop the spill and clean up the contamination. However, the real challenge is to prevent such occurrences 

from happening in the first place, and so it is understandable that 

we should place our emphasis on prevention. What went wrong, 

and how do we avoid these problems in the future? 

So I look forward to working with my colleagues on achieving 

this goal, and I hand back the balance of my time. 

Mr. STUPAK. Thank you, Mr. McNerney. Mr. Griffith for an opening statement, please. 

OPENING STATEMENT OF HON. PARKER GRIFFITH, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ALABAMA 

Mr. GRIFFITH. I would like to thank the Chairman for calling this 

important hearing today. Thank you also to these witnesses who 

have come before our subcommittee to discuss the administration’s 


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role in the recovery response of the Deepwater Horizon drilling disaster that has affected our Gulf States. 

It is essential that we continue to investigate why a disaster of 

this proportion took place, but more importantly we need to look 

into the agency’s response to the explosion and the spill. As the investigation and reviews continue, I think that Congress must question the administration’s response to the disaster. Bureaucracy is 

rarely able to facilitate a quick response. Even the bureaucracy, 

without leadership, is frozen in place, and this event has been yet 

another demonstration of government slowing in recovery. 

It is time to take a good hard look at the Federal response. It 

would have been wise for the administration to have called on all 

possible resources to help in the initial aftermath of this disaster, 

but this was not done. The American public must gain trust in 

their government for an appropriate response in times such as 

these. This means that the Federal government has to get the 

emergency response right. While the days and weeks tick by after 

the spill, most of us saw a lack of urgency in the Federal response. 

The one reaction we have seen from the government is the administration has shut down oil drilling and enforcing a moratorium 

in the Gulf. The Gulf of Mexico accounts for 24 percent of our oil 

production. It affects roughly 170,000 jobs, the economy and our 

energy security. As Louisiana Governor Jindal stated, the moratorium is a second man-made disaster. If we enact policies that drive 

drilling out of U.S. waters, we will cease to be able to ensure that 

crude oil and gas production be done in a safe and environmentally 

friendly manner. It is the duty of Congress to find out exactly what 

happened so that we can most effectively craft policy to prevent future incidents like this. 

I am glad that we have witnesses here today to explain the questionable response of the administration to the spill. As Congress 

draws conclusions into how to prevent another spill from ever happening again, I hope that we can gain insight into why the administration’s response to the spill was seen by the American public as 

slow, and at times absent. 

Thank you for being here today. We appreciate you volunteering 

to be here, and I look forward to your testimony. And Mr. Chairman, I yield back the balance of my time. 

Mr. STUPAK. Thank you. Next, Mr. Green for an opening statement, please. 

OPENING STATEMENT OF HON. GENE GREEN, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. GREEN. Thank you, Mr. Chairman, for holding the hearing. 

Again, welcome our former Secretaries, former Senator and Governor to our panel. And I would like my full statement be placed 

in the record. And clearly there are several decisions made along 

the way that led to a regulatory environment where an environmental disaster of this magnitude could take place, and I look forward to testimony. 

However, I want to take the use of my time today to focus on a 

separate issue that I will bring up when Secretary Salazar is 

present. I remain extremely concerned about what the offshore 

drilling moratorium means to the Gulf Coast and our country’s fuVerDate Mar 14 2013 04:56 Mar 20, 2013 Jkt 077922 PO 00000 Frm 00039 Fmt 6633 Sfmt 6633 E:\HR\OC\A922.XXX A922

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ture energy supply. The court—recent court decision to lift the— 

moratorium was an important step to keeping vulnerable oil and 

gas jobs in the Gulf States and keeping them—our economies viable. However, with the administration’s new reissued moratorium, 

these job losses are back in play. 

I would like to ask unanimous consent to place into the record 

a letter that Congressman Kevin Brady and I, along with other 

members of Congress, sent suggesting a solution to the deep water 

ban that would put people back to work, Mr. Chairman. 

Mr. STUPAK. Without objection. 

[The information was unavailable at the time of printing.] 

Mr. GREEN. It is my strong belief that a moratorium be allowed 

to continue the full 6 months or longer would significantly damage 

our already weakened economy along the Coast and cost tens of 

thousands of jobs, reduce local payrolls by nearly $2 billion and 

threaten the survival of many—related small business, mid-size 

businesses. Additionally, offshore oil and gas production support 

companies throughout the Gulf of Mexico engaged in shallow water 

drilling activities continue to be severely affected by the continued 

de facto moratorium. 

And Mr. Chairman, I would like to ask unanimous consent for 

a letter to be placed in the record—Secretary Salazar that Congressman Boustany and I, plus a number of members of Congress, 

sent to Secretary Salazar at the end of May. 

Mr. STUPAK. Without objection. 

[The information was unavailable at the time of printing.] 

Mr. GREEN. We have actually issued one shallow water drilling 

permit last week. And—even though the moratorium was released 

at the end of May. As a result, 19 jack up rigs, representing over 

35 percent of the available shallow water drilling rigs in the Gulf 

of Mexico, are now without work and idle, putting at risk thousands of jobs in the Gulf of Mexico and orderly production of domestic resources. And I would like to—look forward to hearing 

from the secretary. 

Mr. Chairman, I appreciate your patience, and we want to get to 

the bottom of what happened, but we also need to have domestic 

production of oil and natural gas in our country. So I yield back 

my time. 

Mr. STUPAK. Mr. Latta, opening statement, please, 2 minutes. 

OPENING STATEMENT OF HON. ROBERT E. LATTA, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF OHIO 

Mr. LATTA. Thank you, Mr. Chairman, Mr. Burgess. Again, 

thank you for holding this subcommittee hearing on the Interior 

Department’s role in the Deepwater Horizon disaster, and I also 

want to thank our witnesses for appearing today. 

Last month I had strong words for the BP CEO, Tony Hayward, 

when he testified in front of our Oversight and Investigation Subcommittee, and since then I have reiterated that BP needs to be 

held accountable for this disaster of epic proportions. However, I 

also have been awaiting the opportunity to hear from and question 

Department of Interior officials regarding their role in the Deepwater Horizon disaster, especially since President Obama has reVerDate Mar 14 2013 04:56 Mar 20, 2013 Jkt 077922 PO 00000 Frm 00040 Fmt 6633 Sfmt 6633 E:\HR\OC\A922.XXX A922

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peatedly said that he and his administration are in charge and 

take responsibility for the response effort, as the law so requires. 

Earlier this month I traveled with some of our colleagues to the 

Gulf to tour the Louisiana coast and meet with community leaders 

and residents who have been affected by the disastrous BP oil spill. 

While I was encouraged by the spirit of the hard working local residents, it is clear that they are frustrated by the Federal response 

and the lack of coordination amongst government agencies. The 

trip reinforced my belief that it is critical we find out what went 

wrong and how and why it happened. This includes a through investigation into the current administration’s actions leading up to 

the incident and during the response. 

Furthermore, I believe the administration’s moratorium on deep 

water drilling in the Gulf is devastating the region, and I would 

like to hear about the Interior’s role in making this decision. The 

recent report by a nationally known—renown economist from LSU 

states that the loss of 8,000 jobs, nearly a half a billion dollars in 

wages and over 2.1 billion in economic activity will be triggered in 

just the first six months of this moratorium. The administration 

would have been better advised that stopping the flow of oil instead 

of focusing on imposing a drilling moratorium, this in spite of a 

Federal Judge overturning the first moratorium ban, calling it arbitrary and capricious. 

Mr. Chairman, I look forward to hearing the testimony today, 

and I yield back. 

[The prepared statement of Mr. Latta follows:] 


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pwalker on DSK7TPTVN1PROD with HEARINGInsert offset folio 41 here 77922A.017

Congressman Robert E. Latta 

The Committee on Energy & Commerce 

Subcommittee on Oversight and Investigations and Energy and Environment 

Opening Statement - For the Record 

July 20, 2010 

MR. CHAIRMAN; MR. BURGESS: Thank you for holding this subcommittee hearing 

on the Interior Department's role in the Deepwater Horizon Disaster and I thank our witnesses 

for appearing. 

Last month, I had strong words for BP CEO Tony Hayward when he testified in front of 

the Oversight and Investigations Subcommittee and since then I have reiterated that BP needs to 

be held accountable for this disaster of epic proportions. However, I have also been awaiting 

the opportunity to hear from and question Department ofInterior officials regarding their role in 

the Deepwater Horizon disaster, especially since President Obama has repeatedly said that he 

and his Administration are "in charge" and take responsibility for the response effort, as the law 

so requires. 

Earlier this month, I traveled with some of our colleagues to the Gulf to tour the 

Louisiana coast and meet with community leaders and residents who have been affected by the 

disastrous BP oil spill. While I was encouraged by the spirit of the hard-working local residents, 

it is clear that they are frustrated by the federal response, and the lack of coordination amongst 

the government agencies. The trip reinforced my belief that it is critical we find out what went 

wrong and how and why it happened - this includes a thorough investigation into the cun-ent 

Administration's actions leading up to the incident and during the response. 

Furthennore, I believe the Administration's moratorium on deepwater drilling in the Gulf 

is devastating to the region and I would like to hear about the Interior's role in making this 

decision. A recent report by a nationally-renowned economist from LSU states that the loss of 
37 


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8,000 jobs, nearly $112 billion in wages, and over $2.1 billion in economic activity will be 

triggered in just the first six months of this moratorium. The Administration would have been 

better advised at stopping the flow of oil instead of focusing on imposing a drilling moratorium, 

this in spite of a federal judge overturning the first moratorium and calling it "arbitrary" and 

"capricious". 

Mr. Chairman, I look forward to hearing the testimony today, and I yield back. 
38 

Mr. STUPAK. Thank you, Mr. Latta. Mr. Doyle, for an opening 

statement, please. 

OPENING STATEMENT OF HON. MICHAEL F. DOYLE, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH 

OF PENNSYLVANIA 

Mr. DOYLE. Thank you, Mr. Chairman, for holding this hearing 

on the role of the Interior Department in the Deepwater Horizon 

disaster. I am grateful for the excellent work this committee has 

done on investigating the causes of the Deepwater Horizon accident 

and addressing them through legislation. 

You know, if there is any silver lining to this tragedy, I hope it 

is a renewed effort to engage in intelligent regulations of the industries that operate in our waters and our lands. Like most of you, 

I am frustrated to learn that permits were granted for deep water 

drilling, and Macondo well specifically, without proper safety requirements or oil spill response plans that included the ability to 

cap a leak should the infallible blowout preventer fail. It is even 

more frustrating to learn that required environmental impact 

statements were waived so that drilling the Macondo well could 

commence more quickly. 

Unfortunately, that seemed to set the tone for drilling operations 

on the Deepwater Horizon. As this committee’s investigation has 

proven, BP cut corners every step of the way, and the least protective measures were taken to speed up production of the well. It resulted in one of the worst environmental tragedies we have ever 

seen and further economic hardship in communities along the Gulf. 

Mr. Chairman, today I am not interested in assigning blame. I 

think there is enough to go around. Instead I hope we recognize 

what a great opportunity we have with the Secretaries of the Interior from the last 10 years before us. I look forward to hearing from 

Secretary Salazar, and I want to thank Secretaries Norton and 

Kempthorne for your willingness to be here today. 

While the recent reforms at the Mineral Management Service are 

a good start, there is still much more to do. If we are going to continue accessing the oil and gas resources in the Gulf of Mexico, we 

need smarter and more sufficient regulations of the industry. This 

tragedy has proved that blowout preventer is not a failsafe tool of 

the last resort. We are working in this Congress to bring about better research and development and technologies that can ensure the 

safety of offshore drilling. In fact, much of this R&D is being done 

in my hometown of Pittsburgh, at the National Energy Technology 

Laboratory. I know firsthand that, given the resources of the scientists and engineers at NETL, we are entirely capable of producing technologies that bring us into the 21st century of energy 

development. 

So, Mr. Chairman, I thank you and look forward to the testimony 

today. 

Mr. STUPAK. Thank you, Mr. Doyle. Mr. Gingrey, opening statement. 


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OPENING STATEMENT OF HON. PHIL GINGREY, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF GEORGIA 

Mr. GINGREY. Mr. Chairman, thank you for calling today’s hearing. Even though recent efforts have hopefully halted major oil 

leaks, it is critically important that we get to the bottom of the 

cause of the Deepwater Horizon accident that has severely devastated the Gulf Coast. 

As a member of the O&I Subcommittee, I was present at the 

hearing in which we hade the opportunity to pose questions to BP 

CEO Tony Hayward. At the outset of that hearing I, along with a 

number of my Republican colleagues, raised concerns as to why we 

were not also hearing from the administration to discuss its oversight role to help avoid future accidents of this nature. Mr. Chairman, despite these efforts and the economic and environmental destruction that has resulted from the Deepwater Horizon explosion, 

I am disappointed that it has taken the Committee three months 

to the day of the accident to hear from the Secretary of the Interior. There are several important questions that the administration 

needs to answer to help us find the best way to move forward. 

What was the role of Interior leading up to and in the aftermath 

of the explosion on April 20? Have the reorganization efforts of the 

Minerals Management Service in any way impeded Interior from 

being able to properly investigate and respond to the crisis? In fact, 

what is the purpose of renaming MMS to the Bureau of Ocean Energy Management Regulation and Enforcement, BOOEMRAE? 

Does that only create confusion for the public, media, members of 

Congress, the agency responding to the crisis? Lastly, what impact 

will the administration’s decision to impose a six month moratorium have on the Gulf Coast’s ability to create jobs and make us 

less dependent on foreign oil? 

Mr. Chairman, although I am pleased that we are finally hearing 

from the administration on the Deepwater Horizon disaster, I hope 

that we do not use this hearing to simply score political points, as 

some of my colleagues have said. Today we have the opportunity 

to move forward with answers and ideas for reform. We owe it to 

the families who lost loved ones on April the 20th. We owe it to 

the Gulf Coast region that has continued to struggle economically 

as a result of this disaster, and finally we owe it to our country, 

as we continue to compete successfully, hopefully, in an energy dependent global economy. 

And I yield back, Mr. Chairman. 

Mr. STUPAK. Ms. Capps for an opening statement. 

OPENING STATEMENT OF HON. LOIS CAPPS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Mrs. CAPPS. Thank you, Mr. Chairman, and welcome to our honorable witnesses. It is painfully clear that BP’s oil spill dwarfs any 

environmental disaster in our nation’s history. The first steps, of 

course, are to stop this leak, contain the spill and attend to its devastating consequences. President Obama and his administration 

swiftly responded to the BP disaster from day one, mobilizing resources to minimize harm to the health, economy and environment 

of the Gulf Coast. 


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The President established an independent commission, modeled 

on legislation I introduced with Chairman Markey, to investigate 

the cause, the response and the impact of BP’s spill. The President 

announced tougher safety requirements for offshore drilling and a 

strong inspection regime, and he took appropriate steps to ban new 

deep water wells and other exploratory drilling in sensitive areas. 

While we need immediate regulatory reform to make existing offshore oil development safer, we must also be bold and forward 

thinking in our response. The legacy of a safer, cleaner energy policy is the only possible silver lining to be found in this unthinkable 

catastrophe, and it is from what many of us on this side of the aisle 

had been pushing for years. The good news is there are lots and 

lots of ideas and proposals we can draw from. 

Unlike its predecessor, the Obama Administration has made immediately—immediate investments in efficiency, renewables and 

alternatives. The best way to protect the environment is simply to 

use less energy. Increases in efficiency and renewables can also create jobs and provide a boost to our domestic economy. Most importantly, these advances can be implemented now, with immediate 

benefits and results. Finally freeing ourselves from our costly oil 

addiction would be a fitting tribute to the terrible tragedy being 

borne by the people of the Gulf. 

I applaud the Committee’s efforts for continuing to shine the 

spotlight on this tragedy and for laying out the steps that we must 

take to keep situations from—like this from happening in the first 

place. 

I yield back. 

Mr. STUPAK. Thank you, Ms. Capps. Mr. Pitts, your opening 

statement, please? 

OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH 

OF PENNSYLVANIA 

Mr. PITTS. Thank you, Mr. Chairman. Thank you for holding this 

hearing on the role of the Department of Interior in the Deepwater 

Horizon disaster. I would like to welcome Secretary Kempthorne 

and Secretary Norton. 

The oil spill is indeed a tragedy in the history of our country. Not 

only have lives been lost, but massive amounts of oil have been 

leaked into the ocean, causing horrific effects, environmental and 

economic. It is imperative that we thoroughly understand what 

happened aboard Deepwater Horizon before, during and after the 

explosion so that it never happens again. Indeed, it is of the utmost 

importance that due diligence be done by those investigating the 

root causes of the Deepwater Horizon blowout explosion, and I am 

anxious to read the reports that have been commissioned, once 

they are finished. 

I do have several questions for our witnesses today which focus 

on the offshore drilling moratorium and the re-organization of 

MMS. I would like to know whether the change up in MMS has 

helped or hindered MMS’s ability to investigate and respond to the 

current crisis. 

Regarding the moratorium, I was struck by Governor Jindal’s 

editorial in the ‘‘Washington Post’’ this weekend where he catVerDate Mar 14 2013 04:56 Mar 20, 2013 Jkt 077922 PO 00000 Frm 00046 Fmt 6633 Sfmt 6633 E:\HR\OC\A922.XXX A922

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egorized the moratorium as ill-advised and ill-considered. In addition, he said, ‘‘The moratorium will do nothing to clean up the Gulf 

of Mexico, and it already is doing great harm to many hard working citizens.’’ I am interested to hear the administration’s rationale 

for the original moratorium and their rationale for continuing to 

pursue this policy, even after it has been struck down in the courts. 

Louisiana and the coastal States are already facing a horrific disaster, and we should make sure this moratorium does not worsen 

the blow. 

I look forward to hearing from our witnesses today, and I yield 

back. 

Mr. STUPAK. Thank you, Mr. Pitts. Mr. Melancon, opening statement, please. Two minutes. 

OPENING STATEMENT OF HON. CHARLIE MELANCON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF LOUISIANA 

Mr. MELANCON. Thank you, Mr. Chairman, for holding this hearing today. I want to note that it has been 91 days since this disaster began, and Congress has held many hearings, and in recent 

weeks we have also started to move several pieces of relevant legislation. It was, and remains, important to ensure that the families 

of those 11 men have died on this rig have appropriate recourse 

and means to move on with their lives. It is impossible to say that 

they can ever be made whole again, and that is why I believe it 

is important for our work in Congress to focus on making sure an 

event like this never happens again. 

I thank the Chairman for holding this hearing today. We had 

been drilling in the Gulf of Mexico for decades, and our coastal 

States are home to the most sophisticated energy exploration and 

production technologies in the world. But this tragedy has shown 

us that occasionally our innovation to produce can outpace our innovation to prevent and to respond to blowouts or other such accidents in the Gulf or any other waters. 

The Minerals Management Service, MMS, or Bureau of Ocean 

Energy Management, as is now called, should play an important 

oversight role in the Gulf and other U.S. waters. It is the Department’s responsibility to protect our people and the environment 

that we all call home. It has become painfully apparent that this 

function was performed inadequately in the lead-up to the Deepwater Horizon. Those deficiencies in the Department were deepseated, and I applaud the Secretary and current employees of the 

agency for recognizing these weaknesses and working hard to correct them. I support the Secretary’s request for an increase in the 

number of inspectors available to ensure that safety requirements 

are adhered to in the Gulf. These inspectors can work with the 

leading minds in offshore production to make certain that we still 

supply the country with a safe stable source of domestic energy. 

But in closing, I would like to say that while Louisiana and other 

states face the ever encroaching tide of oil, I intend to make sure 

that another wave of economic devastation does not deliver a second strike to my state. The current deep water moratorium and de 

facto shallow water moratorium have already led to hundreds, if 

not thousands, of lost jobs, and threaten to decimate the rest of the 


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economy along coastal Louisiana, at least whatever economy there 

is left after the oil spill has done its damage. 

These moratoriums are ill-advised, and in some cases could even 

add more risk to the environment than allowing the existing wells 

to be finished according to plan. Abandoning a well in the middle 

of the process has its own unique risks, and I believe that we must 

ask ourselves, does this moratorium make us any safer, and what 

is the real cost to our economy? 

I thank you again for holding this hearing, and I look forward 

to discussing the issue of the moratorium and the drilling and 

cleanup in the Gulf of Mexico, and I yield back the balance of my 

time. 

Mr. STUPAK. Thank you. Mr. Sullivan, opening statement, please. 

OPENING STATEMENT OF HON. JOHN SULLIVAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OKLAHOMA 

Mr. SULLIVAN. Thank you. Chairman Markey and Chairman Stupak, thank you for holding this hearing today to address the Department of Interior’s actions regarding the Deepwater Horizon incident. I welcome Secretary Salazar to this hearing, as well as two 

previous Department of Interior Secretaries, Gale Norton and Dirk 

Kempthorne. 

There is no question that the BP oil spill is a tragedy. In fact, 

it is the worst environmental disaster in our nation’s history. I believe we must do everything in our power to find out what caused 

to explosion and to ensure nothing like this ever happens again. 

Unfortunately, the administration is prematurely acting on this 

tragedy from a regulatory angle while the investigation to the disaster is not complete, which is why I am furious that the Department of Interior issued a new ill-advised moratorium on responsible offshore drilling after their previous two efforts failed in Federal Court. A Federal Judge even called the Obama Administration’s efforts arbitrary and capricious before throwing out their 

moratorium. 

This new moratorium risks killing between 20,000 and 50,000 

jobs, and will increase our reliance on foreign oil at a time when 

our nation’s economy can least afford it. During this hearing and 

the continuing investigation, it is important that we do not lose 

sight of the fact that 30 percent of the total U.S. production of 

crude oil comes from offshore. If we were to ban or restrict offshore 

drilling, we would simply increase our national dependence on foreign oil, which makes our nation less secure, and in the short term 

and long term it increases the cost of energy. 

I am pleased to see Secretary Salazar before us today. Given the 

integral role of the Federal oversight in offshore drilling operations, 

it is critically important to get his take on what safety lapses occurred, and if any regulatory breakdowns happened that may have 

contributed to this terrible accident. I am also interested in hearing 

Secretary Salazar’s justification for the continued moratorium on 

deep water drilling and permitting. 

I look forward to the hearing and testimony of our witnesses, and 

I yield back the balance of my time. 


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Mr. STUPAK. Thank you, Mr. Sullivan. Mr. Gonzalez, opening 

statement. 

Mr. GONZALEZ. Waive opening. 

Mr. STUPAK. Mrs. Christensen, opening statement. 

Mrs. CHRISTENSEN. Thank you, Mr. Chairman. I too waive my 

opening statement. I would just like to welcome Secretary Norton 

and Secretary Kempthorne. 

Mr. STUPAK. Ms. Harman, opening statement. 

OPENING STATEMENT OF HON. JANE HARMAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Ms. HARMAN. Thank you, Mr. Chairman, and welcome our witnesses. 

When then Senator Kempthorne was in the Senate, he served on 

the Senate Intelligence Committee. I served on the House Intelligence Committee for eight years, and remember well the times we 

collaborated on bipartisan sensible policy to hopefully add to our 

intelligence capability in the effort to keep our country safe. I 

would like to think that if Senator Kempthorne were back in the 

Senate, or were to do something astonishing and become a House 

member and sit on this panel, he would want us to work on a bipartisan bicameral basis to solve this problem. And he is nodding 

his head, so he would. I welcome that, and I am delighted to see 

you again. 

This is not about, or should not be about, the blame game, as 

many have said on both sides. I don’t see it that way. I see this 

as a clear disaster, both in environmental and human terms, but 

one that we should come together to fix. This Committee has a long 

record of fixing tough problems and crafting regulatory schemes 

that work. And so, Mr. Chairman, I welcome the testimony of our 

witnesses, and I welcome Senator, Governor, Secretary, private citizen Kempthorne, and our other former Interior Secretary, to help 

us solve this problem. 

Thank you, Mr. Chairman. I yield back. 

Mr. STUPAK. Thank you. Mr. Hall for an opening statement, 

please. 

OPENING STATEMENT OF HON. RALPH M. HALL, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. HALL. Thank you, Mr. Chairman. I am pleased that we are 

having this hearing today. I would also like to thank Honorable 

Gale Norton and Honorable Kempthorne. They are—and, of course, 

Secretary Ken Salazar. 

After three full months we are still trying to figure out what the 

precise causes is of what happened on the Deepwater Horizon on 

April the 20th. The sun came up on April the 20th, May the 20th, 

June the 20th and now it is—today it is exactly, time-wise, July 

the 20th. And I know—I have in my area a friend whose twin 

brother’s boy was one of the 11 that were lost there, so we felt the 

loss even down into the Northeast part of Texas. 

But what really kind of unnerves me and gives me really problems is the President’s first statements about this, when he said, 

have we come to this? An event that he is using to trash all energy 

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ing to destroy the wealth if it is involved in the energy business. 

Not to give light to the situation, but to turn off the lights all over 

our nation. We need to be producing our own energy through the 

bill that was passed several years ago that included not just drilling, but all of the above as answers to disasters like the Deepwater 

Horizon tragedy that we have. 

These unanswered questions should serve to advise against the 

temptations to overreact to the disaster, especially given the importance of the offshore oil and gas industry to the Gulf Coast economy and America’s energy dependence goals. I am troubled by the 

rush to pass legislation on these. These bills will not solve the ongoing problems in the Gulf. 

I do believe we need to re-evaluate the safety procedures and 

drilling procedures we have in place now to fix what went wrong 

and make sure it doesn’t happen again, but that is what I am told 

these investigations are doing as we speak. And only once we know 

exactly what happened can we address the problem. We need to relearn to prevent overreaction and over-regulating the oil industry 

before we know what went wrong. 

It makes sense to continue pursuing improvements to safe and 

environmentally responsible drilling operations, as well as effective 

spill response systems, but to impose a drilling moratorium is just 

a knee jerk reaction that will not solve the problem, will not clean 

up the spill, and amplifies a lack of employment in the Gulf region. 

We should lift the moratorium immediately and get these folks 

back to work. 

I thank you, Mr. Chairman, yield back my time. 

Mr. STUPAK. Thank you. Mr. Butterfield, opening statement, 

please. 

OPENING STATEMENT OF HON. G.K. BUTTERFIELD, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NORTH 

CAROLINA 

Mr. BUTTERFIELD. Thank you, Mr. Chairman, for convening this 

very important hearing, and I certainly thank the two witnesses for 

their testimony. 

Mr. Chairman, news of the BP well may be improving, and the 

American people may be feeling better about this. The fact remains 

that the damage is done. While much of our attention has centered 

on the environmental impacts, let us not forget that the explosion 

killed 11 American citizens. As the facts continue to come into clear 

view, it appears that the company’s bottom line—yes, its bottom 

line, not safety, not concern over its employees or environmental 

risk—was the primary concern. And so strong bipartisan regulations are necessary to ensure the public’s trust, the ocean and everything beneath it, belong to the American people, not private corporations. 

The agreement between the people and these corporations to permit offshore drilling is meant to guarantee the safety and security 

of these irreplaceable resources while furthering commerce. Unfortunately, the technology of deep sea drilling has far outpaced the 

rulemaking and oversight needed to provide the public with security and certainty. We must use today’s hearing to clarify the policy 

choices made within the Minerals Management Service. 


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Without proper understanding of the guiding principles that took 

us to this point, we cannot be expected to write better policy for 

the future. This is an enormous tragedy that necessitates a thorough review, and, yes, overhaul of our regulatory strategy. Such an 

overhaul will once again allow the commerce to thrive, and environmental security to be secured for the trust of the American people. 

Thank you, Mr. Chairman, and I yield back. 

Mr. STUPAK. Thank you, Mr. Butterfield. Mr. Shadegg for opening statement. 

OPENING STATEMENT OF HON. JOHN B. SHADEGG, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ARIZONA 

Mr. SHADEGG. Thank you, Mr. Chairman. I want to thank you 

for holding this important hearing. I want to thank all of our witnesses for appearing today, and especially Secretary Norton and 

Secretary Kempthorne. 

It is critical to the nation, and critical both for environmental 

reasons and also for energy reasons, that we find out what went 

wrong. Some want to blame the lack of regulatory structure, the 

lack of laws, the lack of regulations. Others want to blame the lack 

of enforcement and concerns in that area. In fact, there may have 

been blatant violations of the law. Indeed, most of the evidence we 

have heard so far in this Committee has indicated that BP was a 

bad actor, that, in the drilling of this well and its construction and 

its operation, it ignored warnings time and time again and cut corners. We need to find out exactly what happened in this instance, 

and we need to make sure that no bad actors can ever engage in 

that kind of conduct again. That is essential not only for the protection of our environment, but also for the protection of our economy. 

I think it is very important to point out that this is a process 

that is necessary for the sake of our future. It is not, and should 

not be, a blame gaming—or a blame assigning task. I agree with 

my colleague Mr. Doyle when he says there is plenty of blame to 

go around. That should not be the purpose of these hearings. We 

do not need to engage in finger pointing. What we need to do is 

to find out what went wrong. Unfortunately, some want to view 

this just as a crisis to be exploited. I believe it is a crisis to be addressed and resolved and to ensure that it never happens again. 

I am deeply concerned about the moratorium that has been enacted, and I share the comments of many of my colleagues, Mr. 

Green, Mr. Melancon, and others on both sides of the aisle who are 

concerned about the moratorium which the administration has imposed. I believe that that moratorium was ill-advised, and I find it 

not surprising that it was rejected both by United States District 

Court and then by United States Circuit Court of Appeals. I am 

disappointed that the administration acted in enacting that initial 

moratorium on a report which Secretary Salazar apparently 

changed after he received recommendations from the scientists who 

wrote it. Indeed I have here a letter, which I will later put into the 

record, in which eight of the 15 scientists who work on the report 

say that it misrepresents their views. 

While a moratorium of some sort may indeed have been necessary, it seems to me we should have been looking at a narrow 


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moratorium, one that only looked at bad actors, one that was not 

open ended in time, one that was focused on what things we knew 

then were wrong. And I look forward to the testimony of our witnesses so that we can try to discern what action we need to take 

to ensure this never happens again. 

Mr. STUPAK. Thank you, Mr. Shadegg. Ms. Matsui, opening 

statement, please. 

OPENING STATEMENT OF HON. DORIS O. MATSUI, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Ms. MATSUI. Thank you, Mr. Chairman, for calling today’s hearing. I would like to thank Secretary Salazar and former Secretaries 

Kempthorne and Norton for appearing before us as witnesses 

today. 

I think we can all agree that the BP oil spill reminds us of the 

dangers of offshore drilling, as well as the severe environmental 

and economic impacts when something goes wrong. As this unprecedented disaster continues to unfold, it has raised significant questions about industry practices and regulatory standards relating to 

oil and gas drilling. In our ongoing investigations about the causes 

of this catastrophe, we learned that BP ignored important safety 

precautions and largely dismissed industry’s best practices related 

to well design and other infrastructure that could have prevented 

such an accident. 

We now know that there were issues with MMS and its oversight 

of offshore drilling activities. It is for these reasons that I have 

been pleased to see the Interior Department’s recent overhaul of 

Federal regulations relating to oil drilling and exploration activities. And BP and the government need to ensure that the well is 

both properly and permanently plugged. Moreover, with the cost of 

the debacle now approaching $4 billion, not including lives lost, 

livelihoods in peril and environmental depredation yet to be measured, we must make sure that nothing like this ever happens 

again. And within that context, Congress must continue to examine 

the Interior Department’s role now and in the past in regards to 

the oversight and management of these critical regulatory bodies. 

Thank you, Mr. Chairman, for calling today’s hearing. I look forward to the testimonies of the witnesses before us, and I yield back 

the balance of my time. 

Mr. STUPAK. Thanks, Ms. Matsui. Ms. Blackburn for opening 

statement, please. 

OPENING STATEMENT OF HON. MARSHA BLACKBURN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TENNESSEE 

Mrs. BLACKBURN. Thank you, Mr. Chairman. You know, as we 

have another of our hearings on what happened with the Deepwater Horizon, I think it is so important that we all remember and 

express our sympathies to the families that are in the Gulf region 

that have been so deeply impacted with this. I grew up in South 

Mississippi, and every time I call home, or I am talking with 

friends from college, or friends that I grew up with, or family members, I am again reminded of the very deep and personal impact, 


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whether it is the loss of life, the loss of jobs, the loss of faith in 

the institutions that we have, the loss of faith in an employer, the 

frustration with government agencies, the frustration with the slow 

response times. 

I—there really is many lessons to be learned, and we need to be 

respectful of that process, so I thank you all for being here with 

us today as we continue to work through this process. And as you 

have heard from my colleagues, this is something we want to review. Not place blame, but get it right, and make certain that a 

steadfast process is in place. 

Three questions I am going to have for the Secretary and for the 

two former Secretaries, whom we welcome. I want to get the—your 

thoughts on the new moratorium. What do you think this is going 

to do to save the jobs? How do you think this is going to help business investment? I see that as a bit counterintuitive when I am 

talking to those in the Gulf, so I want to look at that decision process and the expectations of that. 

Secondly, I want to hear from the Secretary on why this Department has failed to comply with numerous requests by members of 

Congress for documents in response to the spill and the cleanup operations. And I say this because, due to the frustration with BP 

and with government agencies and with the—this administration, 

people have come to their member of Congress and have not received—we have not been able to get the information that need. 

And third, I want to know, from the Secretary, how they think 

the new Department of—Bureau of Ocean Energy is going to police 

waste, fraud and abuse of Federal funds and actually conduct regulatory oversight. 

Mr. Chairman, I thank you. I yield back. 

Mr. STUPAK. Thank you. Ms. Schakowsky, opening statement, 

please. 

OPENING STATEMENT OF HON. JANICE D. SCHAKOWSKY, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS 

Ms. SCHAKOWSKY. Thank you very much, Mr. Chairman, and I 

will be brief. 

In the face of this unprecedented disaster, every branch of government must be part of the solution, cleaning up the mess, ending 

the flow, compensating adequately the people, and, of course, preventing this from happening again. And, of course, we have to understand what happened, and that is the focus of this hearing. And 

I appreciate so much the witnesses that are here today so we can 

look at the Department of Interior. 

But I have to say, I haven’t heard much about the responsibility 

of this Congress and this Committee. After all, we all did hear 

about the Inspector General’s report September 8, 2008 about the 

staff at the—at MMS and the gifts and the gratuities, et cetera. We 

knew about that, and hindsight, of course, is 20/20, but the failures 

at BP were knowable as well. We had hearings about the refinery 

fire. And we also could have known that between 1985 to today the 

number of inspectors at MMS has risen only from 55 people in 

1985 to 60 today, while the number of wells has increased from 65 

to 602. So clearly we are going to have to have more inspectors, our 


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Committee’s going to have to be more involved on an ongoing basis 

in oversight, and we are going to have to have the proper systems 

and the proper resources in place to get the job done. So this is 

clearly part of that investigation, but we have to see ourselves as 

an integral part of that—of the solution as well. And I thank you, 

Mr. Chairman, for making sure that that is the case. 

I yield back. 

Mr. STUPAK. Thank you. Mr. Scalise, opening statement. Two 

minutes please. 

OPENING STATEMENT OF HON. STEVE SCALISE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF LOUISIANA 

Mr. SCALISE. Thank you, Mr. Chairman. No other state has been 

more affected by the BP disaster than my home state of Louisiana, 

and we battle the effects of the oil each and every day. But make 

no mistake. The effect of this disaster is reaching far beyond the 

Louisiana state line. The offshore jobs being lost right now are 

American jobs. In the marshlands where the oil continues to infiltrate, those are America’s wetlands and our first line of defense 

against hurricanes and gulf storms. 

We know that MMS, the federal regulator responsible for reviewing and approving offshore operations, just weeks before the explosion certified that the rig and the blowout preventer met the safety 

and environmental requirements and allowed the Deepwater Horizon to continue operating. 

I have said for months now if the blowout preventer was intended to be the last line of defense, then President Obama’s regulating agency was established as the first line of defense, and we 

should fully understand the role that they played in this disaster. 

As the people of Louisiana continue to fight the oil each day, President Obama and his administration are taking what is already a 

human and environmental tragedy and turning it into an economic 

tragedy by continuing to pursue a reckless and harmful moratorium on offshore drilling. 

This drilling ban will result in the loss of over 40,000 high-paying Louisiana jobs and will leave America more dependent on Middle Eastern oil. Some suggest we have to choose between safety 

and jobs. This is a false choice. We can and must preserve the jobs 

while demanding safe energy exploration. The two can and should 

peacefully coexist. 

Make no mistake. This ban has nothing to do with ensuring safety. Instead, it exploits this disaster in an effort to pursue a political 

agenda. As a matter of fact, a majority of the experts hand-picked 

by this administration to do an initial 30-day offshore safety report 

opposed this moratorium and have said that six-month drilling 

moratorium will actually reduce long-term safety. 

While some might claim that a pause on drilling is a reasonable 

step to take, make no mistake. There is no such thing as hitting 

some magical pause button on offshore drilling by issuing a reckless moratorium. If this happens, you will reduce safety in the gulf 

because the most technologically advanced and safest rigs will 

leave first. And the most experienced crews that work on these rigs 

who have decades of industry experience will be the first to leave, 


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seeking work elsewhere. And since our country’s demand for oil has 

not dropped, more oil will be imported on tankers, which account 

for 70 percent of all oil spills. 

In conclusion, instead of exploiting this disaster, the President 

must work with us to fight the oil, improve the safety of offshore 

drilling and put a halt to further consideration of a moratorium 

that will reduce safety, kill jobs, and leave us more dependent on 

foreign oil. Thank you, and I yield back. 

Mr. STUPAK. Ms. Sutton, opening statement please. 

OPENING STATEMENT OF HON. BETTY SUTTON, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF OHIO 

Ms. SUTTON. Thank you, Chairman Stupak and Chairman Markey, for holding this hearing. The explosion on Deepwater Horizon 

resulted in the deaths of 11 workers and injured many additional 

workers. And since that time, we have witnessed the worst environmental disaster in our nation’s history. 

Recent news reports state that BP had the Deepwater Horizon 

rigs failed blowout preventer was modified in China, and other 

shortcuts were taken to maximize profits at the expense of safety. And the costs have been great. BP set aside $20 billion for compensation, and the federal government has billed BP hundreds of 

millions of dollars for cleanup costs. And according to the administration, approximately 40,000 personnel are involved in the cleanup and the protection of the shoreline and the wildlife. 

Over 6,400 vessels are assisting with the cleanup, and while the 

cleanup continues, approximately 84,000 square miles of federal 

waters in the Gulf of Mexico remain closed. Hardworking Americans are out of work and applying for compensation at BP. And 

three months later, a cap on the oil well is finally in place. Although leaks and seepage have been detected. 

The costs have been great indeed and have highlighted the costly 

need to ensure that offshore drilling operations are safe. We cannot 

afford an additional oil spill disaster. Significant steps have been 

taken, including dividing the Mineral Management Service into 

three separate organizations to prevent conflicts of interest going 

forward. 

But as we have witnessed over the last three months, the costs 

of the status quo have been far too great, and we must take appropriate action to make sure that this type of tragedy and its aftermath do not happen again. So thank you for being here. 

Mr. STUPAK. Thank you, Ms. Sutton. Our last opening statement, 

Mr. Braley of Iowa please. 

Mr. BRALEY. Thank you, Mr. Chairman. I will waive my opening. 

Mr. STUPAK. OK, that concludes the opening statement by all 

members of our Oversight Investigation Subcommittee and the Energy and Environment Subcommittee. We have our first panel of 

witnesses before us. We thank them for being here. We have the 

Honorable Gail Norton, who was the Secretary of Interior from 

2001 through 2006. And we have the Honorable Dirk Kempthorne, 

who was Secretary of the Interior from 2006 to 2009. Thank you 

for being here. 

Secretary Norton and Secretary Kempthorne, we appreciate you 

being here, and you have appeared here voluntarily. And once 


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again we appreciate that. It is the policy of this subcommittee to 

take all testimony under oath. Please be advised that you have the 

right under the rules of the House to be advised by counsel during 

your testimony. Do either of you wish to be represented by counsel? 

Secretary Norton? Secretary Kempthorne? OK, both indicate no. 

Let the record reflect the witnesses replied in the affirmative. You 

are now under oath. We begin with 5-minute opening statements. 

And, Secretary, if you don’t mind, we will start with you. Secretary 

Norton, opening statement please. 

[Witnesses sworn.] 

TESTIMONY OF THE HONORABLE GALE NORTON, SECRETARY 

OF THE INTERIOR, 2001–2006; AND THE HONORABLE DICK 

KEMPTHORNE, SECRETARY OF THE INTERIOR, 2006–2009 

TESTIMONY OF GALE NORTON 

Ms. NORTON. Thank you. Mr. Chairman and members of the 

committee, I am deeply saddened and appalled by the Deepwater 

Horizon disaster. It is vitally important that Americans determine 

the causes of the accident and that we take steps to ensure that 

offshore production can continue safely. The explosion and the oil 

spill have been a tragic disaster with unprecedented impact on the 

affected families, communities, and ecosystems. 

It is disturbing to watch the damage unfold, and my thoughts 

have been with the people of the gulf region. As I consider the 

Deepwater Horizon disaster, I am constantly reminded of my earliest exposure to accident investigation. My father who devoted his 

career to aviation was occasionally involved in investigating the 

causes of crashes of small planes. I learned about the National 

Transportation Safety Board and its process for unraveling accident causation, then feeding that information back to manufacturers and pilots. 

As with the devastating aircraft crash, we need to objectively 

seek the truth of what happened in the Gulf of Mexico so we can 

learn lessons that may prevent future tragedies. All those affected 

deserve an objective systematic analysis of the problems. Emotional 

and hasty reactions should not form the basis for long-term policy, 

whether we are talking about flying in airplanes or tapping offshore resources. Getting the balance right between risks and benefits requires knowledge and professional inquiry. 

It has been nine years since I took the helm at the Department 

of the Interior. I am not as conversant about offshore issues as I 

once was, and I will only mention a few things in my experience 

at this point in time. 

The importance of domestic energy production was brought 

shockingly into focus by the terrorist attacks of September 11, 

2001. Until then, it has been risky to rely on unfriendly nations as 

the source of so much of our oil supply. But the attacks transformed that risk into a matter of grave national security. Offshore 

petroleum’s role as the source for roughly a third of American production gave it an important focus. 

Without question, the most powerful OCS experience for me was 

the 2005 hurricane season. Over 4,000 offshore platforms were operating in the Gulf of Mexico when Hurricanes Rita and Katrina 


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pummeled the area. Safety and spill prevention measures were put 

to a severe test. Amazingly, despite two category-five hurricanes, 

the amount of oil spilled from wells and platforms was small. The 

shutoff valves located at the sea floor operated as intended. They 

prevented oil from leaking into the ocean floor when the platforms 

were destroyed. 

There was one weakness in that industry’s strong hurricane performance. The hurricanes dislodged 19 mobile drilling rigs from 

their moorings. Once cut loose, they drifted for miles, dragging 

pipelines behind them and endangering other platforms with which 

they might collide. 

The amount of oil released was relatively small, and a significant 

problem had been revealed. I brought MMS and industry together 

to figure out a solution. After my departure from Interior, MMS 

completed this process and strengthened its mooring standards. We 

found out about the problem, and we solved it. 

There has been a great deal of media attention to the ethics of 

the Minerals Management Service. It pains me to see the vilification of MMS and its employees. I want to speak in defense of the 

vast majority of hard-working and professional men and women in 

the Minerals Management Service. 

As revealed by inspector general reports after I left the department, a handful of employees blatantly violated conflict of interest 

requirements. Their actions were wrong and unacceptable, but 

MMS has over 1,700 employees. The very few misbehaving employees have been blown out of proportion to create a public image of 

the MMS as a merry band of rogue employees seeking favor from 

industry. The public servants I encountered were entirely different. 

I will never forget a meeting with the MMS employees after Hurricanes Rita and Katrina. They were in temporary headquarters 

because their New Orleans headquarters was no longer available. 

They were crammed into a couple of rooms, makeshift desks, working hard to keep up with all of the demands that were coming 

through at that time, approving pipeline repairs, addressing environmental and safety issues, expediting all of the requests, trying 

to regulate with common sense in incredibly difficult circumstances. 

These employees coped with submerged homes, families who 

were in limbo and essentially homeless, but they were working out 

of dedication, serving their country, serving their gulf coast communities. These are the people who represent the Minerals Management Service to me. 

Industry and offshore energy supporters were always conscious of 

the political reaction and industry setbacks occasioned by the 1969 

Santa Barbara oil spill and reinforced by the Exxon Valdez. No one 

wanted to repeat those failures, so industry had an incentive to 

maintain strong environmental protections. That, coupled with regulation, encouraged careful planning and adequate safety precautions. That formula worked well. 

Three months ago and for the many years proceeding, the regulatory and response structure was based on a past history of success. Since 1980, the largest spill from a blowout in federal waters 

was only 800 barrels. All of the plans in both Republican and 


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Democratic administrations were adopted against this backdrop of 

safety. 

Unfortunately, now the federal government must establish future 

policies in the aftermath of a worst-case scenario beyond anything 

most people contemplated. 

I hope Congress will follow the process that has served us so well 

in the aviation field, study what caused the accident and then 

adopt new or additional procedures on that basis. 

Offshore regulators need to have a good working relationship 

with industry to understand what they are regulating and to avoid 

imposing one-size-fits-all rules that ultimately decrease safety. For 

half a century, the Gulf of Mexico has produced a third of our nation’s oil, a huge economic benefit to America with an impressive 

safety record. 

The federal government should not throw out a system that was 

so successful for so long without understanding where the problems 

really are. Thank you. 

[The prepared statement of Ms. Norton follows:] 


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Statement of Gale Norton 

Secretary of the Interior 2001-2006 

Before the House Energy and Commerce Subcommittees on 

Energy and Environment and 

Oversight and Investigations 

July 20, 2010 

I am deeply saddened and appalled by the Deepwater Horizon disaster. It is vitally important 

that Americans determine the causes of the accident, and that we take steps to ensure offshore 

production can continue safely. The explosion and oil spill have been a tragic disaster, with 

unprecedented impact on the affected families, communities, regional economy, and 

ecosystems. It is disturbing to watch the damage unfold, and my thoughts have been with the 

people of the Gulf Coast region. 

I served as Secretary of the Interior from January 2001 until March 2006. The following 

information summarizes some of my experiences and observations regarding offshore energy 

production1

. Although I have reviewed many publicly available documents in preparation for 

this hearing, I am not as conversant about offshore issues as I was when I was being regularly 

briefed by those with expertise and direct responsibility. 

As I consider the Deepwater Horizon disaster, I am constantly reminded of my earliest exposure 

to accident investigation. My father, who devoted his career to aviation, was occasionally 

involved in investigating the cause of small plane accidents. I remember going with him a few 

times to see aircraft wreckage and hearing how the subtle details of shattered metal could 

unveil what happened. The National Transportation Safety Board has a well-established 

process for unraveling the mysteries of accident causation, then feeding that information back 

to manufacturers, airlines and pilots to avoid a repeat of the same mistake. 

Just as occurs with a devastating aircraft crash, we need to objectively seek the truth of what 

happened in the Gulf of Mexico so we can learn lessons that may prevent future tragedies. The 

Deepwater Horizon took 11 lives and has slowly unfolded to impact the lives and livelihoods of 

many, many more people. All the individuals and families affected deserve an objective, 

systematic analysis of the problems. Emotional and hasty reactions should not form the basis 

for long-term policy. Whether we are talking about flying in airplanes or tapping offshore 

1 This testimony represents my own perspective, and does not necessarily reflect the views of any other person or 

organization. It has been over four years since I left the Department of the Interior. This testimony has been 

prepared based on my recollections, but without benefit of documents and staff at Interior. It is quite possible 

that I do not fully recall the details of events or policies, or the exact sequence of events. 
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resources, getting the balance right between risk and benefits requires knowledgeable, 

professional inquiry. 

Offshore energy issues are emotionally charged. On the one hand, the media coverage of BP's 

spreading brown muck of oil, coating wildlife and marshes and once-pristine beaches, creates a 

powerful argument against future drilling. On the other hand, the economy of the Gulf Coast, 

as well as the rest of our country, and America's energy security all rely on continued 

development of offshore energy. 

The oil industry people involved with offshore production and the government officials involved 

with offshore regulation have long recognized that a significant accident could threaten human 

life, challenge the financial future of any company involved, and risk loss of the fragile political 

consensus allowing offshore energy expansion. This widely understood need for caution led to 

a decades-long record of safe performance. But even with that understanding, when the 

dreaded spill finally came, it was a worst case far beyond expectations. It has been a "perfect 

storm." 

During my time at Interior, I observed many challenges for managing offshore production. 

Some were rare events like hurricanes Rita and Katrina, while others were ongoing aspects of 

providing meaningful oversight in a time of rapid technological change. The following 

discussion highlights some of my key experiences. 

When the Bush Administration took office, we were faced with "the most serious energy 

shortage since the oil embargoes of the 19705" with many families paying energy bills two to 

three times higher than a year previously.2 We recognized the need for a comprehensive 

energy policy. I was part of the National Energy Policy Development Group, which 

recommended that America pursue a three-part strategy of enhancing energy conservation, 

expanding renewable energy opportunities, and developing traditional energy sources. The 

recommendations of this group formed the backbone of the Energy Policy Act of 2005. The 

energy task force report included recommendations on Outer Continental Shelf development 

that included addressing regulatory delays and uncertainties, completing the next 2002-2007 

OCS lands Act five-year plan, and holding lease sales on a predictable basis. The report noted 

that "exploration and production from the OCS has an impressive environmental record. For 

example, since 1985, OCS operators have produced over 6.3 billion barrels of oil and have 

spilled only 0.001 percent of production.,,3 

We did not pursue an uninterrupted expansion of offshore development, however, as 

exemplified by our actions on lease Sale 181. The Clinton Administration, in its five-year OCS 

2 National Energy Policy Development Group, National Energy Policy Report, May 2001, at viii. 

3 1d. at 5-7. 

2 
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plan for 1997-2002, had scheduled Lease Sale 181 as the first lease sale in many years in the 

eastern Gulf of Mexico. This sale would have allowed drilling within 16 miles of the Florida 

Panhandle. On July 2, 2001, I announced that the Bush Administration was reducing the area 

available in that sale, so that all eastern Gulf leasing would remain at least 100 miles from the 

Florida coastline. President Bush also took formal action to prevent leasing in the Straits of 

Florida. We incorporated this reduced Gulf acreage into the 2002-2007 OCS five-year plan. 

The Gulf of Mexico Energy Security Act of 2006 later expanded this area southward, while 

maintaining the setback from the Florida coast. 

Similarly, we addressed the issue of long-standing leases in the Destin Dome OCS region, an 

area near the Florida coast expected to be rich in natural gas. The state of Florida objected to 

those federal leases as inconsistent with their Coastal Zone Management Act plan, and the 

lease-holding companies filed suit in 2000 to force drilling to progress. We resolved the 

litigation by buying out leases for $l1S million so that exploration and production would not 

occur in an area where the state was so strongly opposed. 

The importance of domestic energy production was brought shockingly into focus by the 

terrorist attacks of Sept. 11, 2001. Until then, it had been risky to rely on unstable and 

unfriendly nations as the source of so much our oil supply, but the profound geopolitical 

implications of the attacks on New York and Washington transformed that risk into a matter of 

grave national security. Our strategies for improving domestic energy production did not 

change significantly, but they had a new urgency on all fronts. Over the next several years, we 

streamlined onshore energy permitting, added staff to handle the increased workload, and 

issued ten times as many permits for renewable energy development as the previous 

administration.4 

As to offshore petroleum, its role as the source for roughly a third of domestic oil production 

gave it an important focus. The Minerals Management ServiceS was the agency responsible for 

offshore leasing and regulation under the Outer Continental Shelf Lands Act, as well as onshore 

and offshore mineral revenue management. During my term, MMS had slightly over 1700 

employees. In preparation for this hearing, I briefly reviewed the annual executive branch 

budget requests for MMS funding. The funding levels remained relatively steady from 2001 to 

2006, with some targeted increases in the Gulf of Mexico regulatory program. 

'This calculation, done by Interior staff circa 2005, was based on onshore wind, solar and geothermal permits. In 

addition, the Energy Policy Act of 200S gave the Minerals Management Service authority to regulate offshore 

renewable energy projects. I welcomed this opportunity and MMS published an Advanced Notice of Proposed 

Rulemaking in December 2005. 

S Secretary Salazar recently reorganized and renamed the MMS. However, because this testimony focuses on 

Interior's activities from a historical perspective, for clarity and consistency I will refer to the organization as MMS. 

3 
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The MMS action most relevant to today's hearing was the adoption of final rules in 2003 

addressing, among other things, blowout preventers ("BOPs") and cementing processes. 68 

Fed. Reg. 8402 (Feb. 20, 2003).6 These rules were proposed in 2000, 65 Fed. Reg. 38453 (June 

21, 2000), and several studies were done to provide the scientific and engineering basis to 

determine whether the rules were adequately protective. Based on the final Federal Register 

notice, it appears that only 11 entities submitted comments, all from within the energy 

industry. The final rules differed little from the originally proposed version. MMS rejected 

several energy industry requests to change the rules from those originally proposed. See 68 

Fed. Reg. at 8404-8405. The rule required the BOP system to include at least four remotecontrolled devices. The 2003 rule added a provision requiring operators to show that the blindshear rams must be capable of shearing the drill pipe that would be used. 30 C.F.R. 250.416 (e) 

and 250.441 (b). A 2004 study specifically addressing performance of shear ram blowout 

preventers with the heavier pipes used in deepwater situations reinforced the need for the 

2003 regulation. 7 The regulation also included a broad performance based standard that 

operators must design, install, maintain, test and use the BOP system to ensure well control. 

30 C.F.R. 250.440. It is my understanding that these 2003 rules were still in effect at the time of 

the BP blowout. From media reports, it appears these rules may have been violated in the days 

leading up to the accident. 

Without question, the most powerful oes experience for me was the 2005 hurricane season. 

Over 4000 offshore platforms were operating in the Gulf of Mexico when hurricanes Rita and 

Katrina pummeled the area. Safety and spill prevention measures were put to a severe test. As 

6 I did not recall the specifics of these regulations before I began preparing for this testimony, and I am certainly 

not an expert in the technical aspects of petroleum technology, so this paragraph is based on a reading of the 

Federal Register notices. 

7 Secretary Salazar's report to President Obama following the Deepwater Horizon incident specifically addressed 

these regulations and studies: 

These studies have examined, among other things, blind shear ram capabilities, back-up BOP systems, and 

drilling and cementing design and operations, which have informed the setting of Department 

regulations. For example, the 1999 Reliability of Subsea BOP systems for Deepwater Applications (study 

number 319) recommended modifying testing regulations to ensure that the testing of variable pipe rams 

appropriately account for the diameters of all the sizes of pipe used in a given drilling project. The 

Department used this recommendation in revising its 2003 final drilling regulations. 

The 2002 Review of Shear Ram Capabilities (study number 455) identified issues associated with the 

cutting power of shear rams .... The Department adopted the report's recommendation that the BOP 

must be capable of shearing pipe planned for use in current drilling programs .... 

The 2004 Evaluation of Sheer Ram Capabilities (study number 463) expanded on the analysis .... The 

results of this study confirmed the regulatory decision to require operators to submit documentation that 

shows the shear rams are capable of shearing the pipe in the hole under maximum anticipated surface 

pressures, 

Increased Safety Measures for Energy Development on the Outer Continental Shelf (May 27, 2010) at 8. 

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one important precaution, all of the platforms in each storm's path were evacuated in advance, 

and there was no loss of human life. I remember hearing reports that platforms clocked winds 

at over 170 miles an hour. Fish were later found lodged in platform structures far above the 

waterline. A number of mostly older platforms were destroyed by the storm's fury. Amazingly, 

despite the strength of the hurricane, the amount of oil spilled from wells and platforms was 

quite small. The shut-off valves located at the sea floor operated as intended. They prevented 

oil from leaking into the ocean even when the platforms were severely damaged. The spill 

prevention techniques upon which industry and government relied passed the hurricane test. 

There was one weakness in the industry's strong hurricane performance. The hurricanes' 

forces were enough to dislodge 19 mobile drilling rigs from their moorings.s Once cut loose, 

they drifted for miles, dragging pipelines behind them and endangering other platforms with 

which they might collide. The amount of oil released was still relatively small, but a significant 

problem had been revealed. Shortly thereafter, I convened a conference of industry and 

agency regulators to discuss how drilling rig moorings could be strengthened. My recollection 

is that there was agreement on the need for action and the industry participants supported 

more stringent standards. After my departure from Interior, MMS completed this process and 

significantly strengthened its mooring standards to avoid future occurrences. 

MMS Employees 

There has been a great deal of media attention to the ethics of MMS. It pains me to see the 

vilification of MMS and its employees. I want to speak in defense of the vast majority of hardworking and professional men and women ofthe Minerals Management Service.9 As revealed 

by Inspector General reports after I left the department, a handful of employees blatantly 

violated gift limitations and other conflict of interest requirements. Their actions were wrong 

and unacceptable. These employees were disciplined, and I join in condemning their 

misconduct. But MMS has over 1700 employees. The very few misbehaving employees have 

been blown out of proportion to create a public image of the MMS as a merry band of rogue 

employees seeking favors from industry. The public servants I encountered were entirely 

different from that impression. 

The International Regulators Forum, composed of government offshore regulators from around 

the world, named its global offshore safety award for Carol ita Kallaur, who headed MMS 

8 This problem occurred on a smaller scale during Hurricane Ivan in 2004, and MMS had already started studying 

mooring systems of mobile offshore drilling units. 

9 Whether individual MMS employees made mistakes in approving BP plans or actions is a separate question. My 

point is to address the broad-brush mischaracterization of MMS conduct. 

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offshore programs until her death in 2003. This shows the high regard internationally for MMS 

professionalism and safety leadership. 

Even Earl Devaney, the Interior Inspector General who investigated and reported on 

misconduct in MMS offices, said that "99.9 % of DOl [Department of the Interior] employees 

are ethical, hard-working and well-intentioned." Devaney Testimony before the House 

Committee on Natural Resources, September 18, 2008. 

I will never forget meeting with MMS employees after hurricanes Rita and Katrina had 

devastated the Gulf Coast. The New Orleans staff had relocated to a temporary headquarters, 

with dozens of employees in a few rooms, sharing makeshift desks of folding tables and any 

other flat surface they could find. They were working around the clock to fulfill their role in 

hurricane recovery -- compiling damage and repair information, addressing safety issues and 

environmental concerns, approving pipeline repairs, expediting requests for temporary barging 

of oil, and applying common sense to regulate appropriately in incredibly difficult 

circumstances. These employees told me of coping with submerged homes, families in limbo 

and essentially homeless, friends who were missing, shattered lives. But they were working out 

of dedication, serving the country, serving their Gulf Coast communities. These are the people 

who represent the MMS to me. 

Future 

Based on media reports, it appears that decisions made by BP in the last days and hours before 

the blowout were the primary cause of the blowout. If regulations on the books and industry 

best practices had been followed properly, there may not have been a blowout. But that is 

clearly an open question at this point, and one that deserves to be thoroughly examined. 

As someone who was not personally involved in those last few hours, or even those last few 

years, but who was involved with the regulatory program, perhaps I can provide some longer 

term perspective. As I noted above, industry and offshore energy supporters were always 

conscious of the political reaction and industry setback occasioned by the 1969 Santa Barbara 

oil spill, reinforced by the Exxon Valdez. No one wanted to repeat those failures, so industry 

had an incentive to maintain strong environmental protections. Santa Barbara's example of the 

fragility of support for offshore production, coupled with regulation, was expected to be 

enough incentive to assure careful planning and adequate safety precautions. That formula 

worked well. Three months ago and for the many years preceding, the regulatory and response 

structure was based on a past history of success. Since 1980, the largest spill from a blowout in 

6 
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federal waters was 800 barrels.lO All of the plans under both Republican and Democratic 

administrations were adopted against this backdrop of safety. 

Unfortunately, human activity is not prone to perfection. Now the federal government must 

establish future policies in the aftermath of a worst case scenario beyond anything most people 

contemplated. What we can do is recognize and learn from our mistakes. I hope Congress will 

follow the process that has served us so well in the aviation field: study what caused the 

accident and then adopt new or additional procedures, standards, laws and regulations, if 

needed, on that basis. I urge you to use the National Transportation Safety Board as a model to 

objectively investigate and learn from this accident. Investigators should be people with true 

technical expertise and relevant experience. 

I urge Congress and regulators to respond in a balanced way: take strong action to ensure 

safety measures are in place and that industry complies. Devote more resources to research 

and preparedness for oil spill response. But do not impede America's energy security or 

destroy processes that have worked well in the past. 

Offshore regulators need to have a working relationship with industry to understand what they 

are regulating and to avoid imposing one-size-fits-all rules that may ultimately decrease safety. 

Industry is at the technological cutting edge, and it will take a great deal of skill and a good flow 

of information for regulators to find the right balance. Government regulators must also have 

the relevant skills and capacity to provide proper oversight and enforcement. 

Pollution-control regulation has evolved from an approach of mandating specific equipment to 

a more flexible performance-based model. Policymakers should be mindful in reevaluating 

offshore regulation to continue encouraging innovation. The best safety and environmental 

protection improvements will come with technological development. 

Policymakers should make sure standards are clear and predictable so companies can invest the 

billions of dollars needed for each new offshore platform. Companies must contract many 

months and even years in advance for the personnel and equipment for a major project. Delays 

can undermine financing, resulting in lost jobs and higher energy costs. Our country needs 

action that will solve the problems while recognizing the importance of offshore production to 

our nation's economy. 

America has been at the leading edge of offshore safety and environmental protection. We 

have suffered a devastating setback. lives have been lost. Whole communities have been 

affected. The environment has been seriously impacted. We should strive to learn from the 

mistakes and make sure they never happen again. 

10 American Petroleum Institute, Analysis of U.S. Oil Spillage, API Publication 356, August 2009, at 25. 

7 
60 

Mr. STUPAK. Thank you. Secretary Kempthorne, opening statement please. 

TESTIMONY OF DIRK KEMPTHORNE 

Mr. KEMPTHORNE. Mr. Chairman, thank you very much to all 

members of the committee. I am Dirk Kempthorne, and I have testified before Congress as a United States senator, as the governor 

of Idaho, as a cabinet member. This is my first time testifying that 

I have been in the elevated position as a private citizen. 

My responsibilities as secretary ended at the Department of Interior 449 days ago. Ninety days ago, the BP oil spill exploded into 

the nation’s consciousness. The accident of BP’s Deepwater Horizon 

oil rig caused 11 families to bury their sons, husbands, and fathers. 

The accident injured 17 workers. It forced fishermen and others to 

lose their livelihoods. It engulfed the Gulf of Mexico with oil slicks 

that now are close to beaches and marshes in the bayou. 

Out of respect for Congress where I served for six years and out 

of respect for these two committees, I accepted your request that 

I talk with you about the tragic oil spill. In light of leaving Interior 

18 months ago and without access to Interior staff or briefing documents, I preface all of my remarks with the understandable caveat, 

as I recall. Until now, I have declined multiple media requests to 

comment in the belief America was best served by letting those in 

charge to stay focused on job number one of stopping the oil spill. 

As you can appreciate, I cannot provide any insight about the exploration plan and the many dimensions of the application for the 

permit to drill which culminated in the Deepwater Horizon accident because these were evaluated and approved after I left Interior. 

For 40 years prior to this accident, the Interior Department and 

the industry it regulated had a remarkable record of success in 

safely developing and producing energy from oil platforms and 

drilling rigs. 

Secretary Norton and I took note of this remarkable safety record 

and so did our successor, Secretary Salazar. Before the BP oil spill, 

Secretary Salazar on March 31 of 2010 announced he had revised 

the 2007/2012 five-year plan. This plan called for developing oil 

and gas resources in new areas while protecting other areas. On 

the issue of safety, Secretary Salazar said, and I quote, ‘‘Gulf of 

Mexico oil and gas activities provide an important spur to technological innovation, and industry has proven that it can conduct its 

activities safely.’’ That statement, Mr. Chairman, is consistent with 

my own impressions while serving as the secretary of the Interior. 

By requesting me to attend, you are asking about the record of 

the Bush administration on offshore energy development. I offer 

these perspectives from my experience as secretary. This hearing 

gives me an opportunity to address an issue about the ethical culture at the Minerals Management Service. Let me address the 

issue of ethics head on. 

Shortly before leaving office, I was summoned to Congress to testify on inspector general reports about unethical conduct within the 

Minerals Management Service. On September 18, 2008, I unequivocally told Congress that the conduct disgusted me and there would 

be prompt personnel action. Because that action was underway, I 


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61 

was advised by lawyers at the Department of Interior that I could 

not discuss it in detail. Now I can, including the fact that we fired 

people. 

It should be part of this hearing record that Johnny Burton, who 

had been director of MMS during Secretary Norton’s tenure, has 

publically stated upon hearing about this conduct, that she personally requested the IG to investigate. It should also be part of this 

hearing record that those involved were fired, retired, demoted, or 

disciplined to the maximum extent permissible. 

The facts are that all of these actions were taken before I left office. I would add a statement that Inspector General Earl Devaney 

said in a testimony before the House Natural Resources Committee 

on September 18, 2008, and I quote, ‘‘I believe that the environment of MMS today is decidedly different than that described in 

our reports.’’ And I agree with the IG that 99.9 percent of DOI employees are ethical, hard-working, and well-intentioned. 

Mr. Chairman, members of the committee, they are part of your 

team. There are good people there. 

I received another report critical of the MMS Service Royalty 

program. Again I took action. The current administration puts 

stock in the Don Carey report reviewing MMS. I would like the 

record to note that I personally called former senators Jake Garn, 

a Republican, and Senator Bob Carey, a Democrat, and asked them 

to conduct a bipartisan, independent and thorough examination of 

this program with no preconceived outcomes. They did with other 

talented experts. 

They issued a report that recommended 110 actions to improve 

the program, including, as I recall, 20 recommendations directly 

from the inspector general’s office. We methodically implemented 

all of the recommendations that could be done while we were still 

in office, which, as I recall, was about 70. 

Mr. Chairman, I would ask that the testimony of Inspector General Earl Devaney and I gave to Congress in September of 2008 be 

made part of the record as well as the Don Carey report. 

Mr. STUPAK. Without objection, it will be. 

[The information appears at the conclusion of the hearing.] 

Mr. KEMPTHORNE. Also, while I was Secretary of the Interior not 

once but twice increased royalty rates companies paid for energy 

produced for deepwater offshore leases. In 2007, we increased the 

royalty rate from 12.5 percent to 16.67 percent. In 2008, the royalty 

rate was again increased to 18.75 percent. This is a 50 percent increase in royalty rates paid by oil companies for the right to 

produce oil and gas from federal waters. 

I can report to you that these increases came as a result of a conversation I had with President George Bush. He believed and I 

agreed that a 12.5 percent royalty rate was too low. I would also 

note that not once but twice budgets that I submitted called for 

Congress to repeal sections of the 2005 Energy Policy Act that provided additional price incentives for deepwater oil and gas development. 

As secretary, I was required by the Outer Continental Shelf 

Lands Act to issue a five-year plan covering the years 2007 to 2012 

for offshore oil and gas development. Once we finished that plan, 

it was required by law to be submitted to Congress for a 60-day 


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review. Congress had the power to reject that plan. Congress did 

not. In fact, as I recall, I don’t think any legislation was introduced 

calling for the plan to be rejected. The plan is here. 

This plan was developed after extensive consultation with members of Congress, state and local official, industry, and environmental organizations. We received comments from more than 

100,000 interested citizens. 75 percent of the comments received 

from the public supported some level of increased access to the domestic energy resources of the outer continental shelf. 

My five-year plan, Mr. Chairman, was met with both draft and 

final environmental impact statements. A relevant fact is that 

these EISs, along with environmental assessments and oil spill response plans, were based on the probability that a significant oil 

spill was small. The environmental impact statement used historical information and models. When the 2007 and 2012 five-year 

plan was written, there had not been a major oil spill in 40 years. 

One very real consequence of the Deepwater Horizon accident is 

that these historical assumptions will be forever changed. 

An additional significant development was taking steps to implement congressional direction and further the work that Secretary 

Norton set in motion to development offshore wind, wave, and 

ocean current strategies. 

Mr. Chairman, I would conclude with two thoughts. One, as you 

appropriately deal with this issue, and I appreciate the tone which 

has been set by so many of the members of this committee, that 

this is an opportunity to bring out issues that are before us, to find 

out what worked, what did not work, and what is the path forward. 

But I would encourage all officials working on this to keep in 

mind the great resources that you have with the states with the 

governors in those gulf coast states, proven leaders who are pragmatic and want to be partners. They also have solutions to this. 

And second, the consequence of the Deepwater Horizon accident 

is that it will forever change the offshore energy industry. Never 

again will a cabinet secretary take office and be told that more oil 

seeps from the seabed than has been spilt from drilling operations 

in U.S. waters. Never again will decision makers not include planning for events that might be low probability events but which in 

the unlikely event they occurred, would be catastrophic. Thank 

you, Mr. Chairman. 

[The prepared statement of Mr. Kempthorne follows:] 


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Testimony of 

Dirk Kempthorne 

Former Secretary of the U.S. Department of the Interior 

The Subcommittees on Oversight and Investigations and 

Energy and the Environment 

July 20, 2010 

Mr. Chairmen, I am Dirk Kempthorne. I have testified before Congress as a United 

States Senator, as the Governor of Idaho and as a Cabinet Secretary. This is my 

first time testifying in the elevated status of a private citizen. I am also the former 

Secretary of the Department of the Interior. My responsibilities as Secretary ended 

449 days ago. 

Ninety days ago the BP oil spill exploded into the nation's consciousness. The 

accident on BP's Deepwater Horizon oil rig caused 11 families to bury their sons, 

husbands and fathers. The accident injured 17 workers. It forced fishermen and 

others to lose their livelihoods. It engulfed the Gulf of Mexico with oil slicks that now 

tar coastal beaches and marshes of the bayou. 
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Out of respect for Congress where I served for six years, I accepted your request 

that I talk with you about this tragic oil spill. In light of leaving Interior 18 months ago 

and without access to Interior staff or briefing documents, I preface all of my remarks 

with the understandable "as I recall" caveat. 

Until now, I have declined multiple media requests to comment in the belief America 

was best served by letting those now in charge to stay focused on job number one of 

stopping the oil spill. 

As you can appreciate, I cannot provide any insight about the exploration plan and 

the many dimensions of the application for the permit to drill which culminated in the 

Deepwater Horizon accident because these were evaluated and approved after I left 

Interior. 

2 
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As you know, almost one-third of the Nation's domestic energy production is 

generated from Interior managed lands and waters. For 40 years prior to this 

accident, the Interior Department and the industry it regulated had a remarkable 

record of success in safely developing and producing energy from oil platforms and 

drilling rigs that fueled American homes, cars, and factories. More than 223 trillion 

cubic feet of natural gas and 41 billion barrels of oil from 8,200 active mineral leases 

were produced from America's federal offshore waters during this time. 

Before the Deepwater Horizon accident, there was a 40-year record of 

environmental protection in offshore drilling. The last major oil spill from a platform 

occurred in 1969 near Santa Barbara, California. As the Interior Department had 

stated - on various occasions - before the BP accident, "natural cracks in the 

seabed cause oil seeps 150 times larger in volume than oil spilled due to OCS oil 

and gas activities." This record of environmental protection occurred when 

Republicans and Democrats at controlled the Administration and the Congress. 

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Secretary Norton and I took note of this remarkable safety record and so did our 

successor, Secretary Salazar. Before the BP oil spill, Secretary Salazar on March 

31, 2010, announced he had revised the 2007-2012 five year plan. This plan called 

for developing oil and gas resources in new areas while protecting other areas. On 

the issue of safety, Secretary Salazar said and I quote "Gulf of Mexico oil and gas 

activities provide an important spur to technological innovation and industry has 

proven that it can conduct its activities safely." 

That statement is consistent with my own impressions while serving as the Secretary 

of the Interior. 

Mr. Chairmen, this raises an important point. At an earlier hearing, Members of 

Congress and Americans unfortunately watched officers from the three companies 

involved in the Deepwater Horizon accident point fingers of blame at each other for 

causing the accident. Let's not repeat that spectacle. 

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All of us - present and former Administration officials, Governors, Members of 

Congress and citizens - never contemplated an accident of this magnitude could 

ever happen. Had we thought so, I am confident that both the Executive and the 

Legislative Branch would have worked on a bipartisan basis to prevent it. 

One indication that an oil spill of this magnitude could never have been imagined 

was the Gulf of Mexico Energy Security Act of 2006. That law contains no reference 

to needing to do additional work to prevent oil spills or expand capability to respond 

to oil spills. I don't ever recall concerns raised at my confirmation hearing or in my 

subsequent testimonies before Congress, or in reports from the Inspector General or 

from the news media that an oil spill of this magnitude could occur. 

In fact, the opposite occurred. I recall being pointedly asked during Congressional 

hearings why Interior wasn't doing more to expand offshore energy development, not 

less. In part this concern was driven by the then soaring $4 a gallon gasoline prices. 

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As Secretary, I toured an operating Gulf coast oil rig. I recall being briefed about 

shut-off valves on the ocean floor that would stop oil spills in an emergency. I was 

impressed by the pride and professionalism of oil rig workers, as well as the 

complexity of their task and their commitment to human safety and environmental 

protection. 

Their commitment to safety and environmental protection was vividly reinforced by 

the fact that 36 major tropical storms and fierce hurricanes interrupted all or part of 

the Gulf Coast during the eight years of the Bush Administration. These storms 

carried the force of 200 mile-per-hour winds and 100-foot waves. 

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As Secretary, I personally experienced eight of those tropical storms and hurricanes. 

I recall receiving reports of the number of drilling rigs being evacuated, the amount of 

oil production being stopped and rigs being damaged. I don't recall a single instance 

of reports of loss of life, shut off valves not working, or major oil spills even when 

fierce hurricanes damaged or destroyed facilities. Secretary Norton will talk more 

about her experience with 28 of these storms, including the two worst ones, the 

infamous Hurricanes Katrina and Rita. But, again, our perspectives are not unique. 

Every Interior Cabinet secretary for 40 years could say the same thing before the 

Deepwater Horizon accident. 

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I do not envy my successor. I applauded the decision to name him as Secretary of 

the Interior. As a private citizen, I am not privy to the information developed and 

gathered to make these decisions. But I know the pressure of making decisions 

while under the glaring lights of public scrutiny and 24 hour news cycles. It is easy to 

second guess and criticize. 

By requesting me to attend, you are asking about the record of the Bush 

Administration on offshore energy development. I mentioned previously that our 

eight year record - similar to other Cabinet Secretaries' records until the Deepwater 

Horizon accident - was that natural seepage of oil from the ocean floor exceeded oil 

spills from drilling operations by 150%. 

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I state this as a fact, not to claim credit. The real credit belongs to the men and 

women in industry who were motivated to work safely and to protect the environment 

and to the regulators who monitored their performance even in the face of category 5 

hurricanes. The vast majority of these civil servants served their nation well. Both 

Secretary Norton and I recall being briefed by MMS employees who had lost their 

homes during hurricanes yet they left their families and did the work America 

needed. 

I offer six additional perspectives from my experiences as Secretary. 

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1. Ethical Culture of the Minerals Management Service 

This hearing gives me the opportunity to address an issue about the ethical culture 

at the Minerals Management Service. Let me address the issue of ethics head on. 

Shortly before leaving office, I was summoned to Congress to testify on Inspector 

General Reports about unethical conduct within the Minerals Management Service. 

Those who work with me know that if a problem surfaces I work to fix it. On 

September 18, 2008, I unequivocally told Congress that the conduct disgusted me 

and there would be prompt personnel action. Because that action was underway, I 

was advised by Interior's lawyers that I could not discuss it in detail. Now I can, 

including the fact that we fired people. 

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It should be part of this hearing record that Johnnie Burton, who had been director of 

the Minerals Management Service during Secretary Norton's tenure, has publicly 

stated, upon hearing about this conduct, that she personally requested the Inspector 

General to investigate. It should also be part of this hearing record that those 

involved were fired, retired, demoted or disciplined to the maximum extent 

permissible. The facts are that all of these actions were taken before we left office. 

I would add a statement that Inspector General Earl Devaney said in testimony 

before the House Natural Resources Committee on September 18, 2008 and I 

quote: "I believe that the environment of MMS today is decidedly different than that 

described in our reports. While there is undoubtedly more that needs to be 

addressed, programmatic improvements must be matched with controls and strong 

oversight to ensure that this bureau, which is so lucrative to the United States 

Treasury and the American Public, does not again veer wildly off track." 

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I received another report critical of the Minerals Management Service royalty 

program. Again, I took action. The current Administration puts stock in the GamKerrey report reviewing MMS. I would like the record to note that I personally called 

former Senators Jake Gam, a Republican and Bob Kerrey, a Democrat, and asked 

them to conduct a bipartisan, independent and thorough examination of this program 

with no pre-conceived outcome. They did. They issued a report that recommended 

110 actions to "improve the program, including, as I recall, more than 20 

recommendations from the Inspector General's office. We methodically 

implemented all of the recommendations that could be done while we were still in 

office, which, as I recall, was about 70 in number. 

Mr. Chairmen, I would ask that the testimony that Inspector General Earl Devaney 

and I gave to Congress in September of 2008 be made part of this hearing record as 

well as the Gam-Kerrey report. 

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I took seriously the need to foster an ethical culture at MMS. In fact, we hired an 

ethics professional to work full time in MMS' Denver office. We sought from 'Rick 

Cusick, Director of the Office of Government Ethics, a list of "best practices," which 

my top ethics officer reviewed for consistency with our own practices. As a result of 

these efforts, Mr. Cusick asked me to talk to 600 government-wide ethics officers 

about Interior's program. Inspector General Earl, Devaney asked me to talk to all of 

the government's Inspector Generals about Interior's work at their annual 

conference. 

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2. Increased Deepwater Royalty Rates 

Second, while I was Secretary, Interior not once, but twice, increased royalty rates 

that companies paid for energy produced from deepwater offshore leases. In 2007, 

we increased the royalty rate from 12.5% to 16.67%. In 2008, the royalty rate was 

again increased to 18.75%. 

This is a 50% increase in royalty rates paid by oil companies for the right to produce 

oil and gas from federal waters. I can report to you that these increases came as a 

result of a conversation I had with President George Bush. He believed, and I 

agreed, that a 12.5% royalty rate was too low. 

Partly because of these higher royalty rates and increases in energy prices, in 2008 

the Interior Department disbursed from both offshore and onshore energy programs 

a record amount of money - more than $23 billion as I recall- to federal, state, local 

and tribal governments. More than $10 billion came from offshore oil revenues. 

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I would also note that not once, but twice, budgets that I submitted called for 

Congress to repeal sections of the 2005 Energy Policy Act that provided additional 

price incentives for deepwater oil and gas development. With today's energy prices, 

the Bush Administration believed these incentives were unnecessary. I still believe 

to this day that these incentives have outlived their usefulness. 

3. Development of Five-Year Offshore Energy Plans 

Third, as Secretary, I was required by the Outer Continental Shelf Lands Act to issue 

a 5-year plan covering the years 2007-2012 for offshore oil and gas development. 

Once we finished that plan it was, as required by law, submitted to Congress for a 

60-day review. Congress had the power to reject that plan. Congress did not. In 

fact, as I recall, I don't think any legislation was even introduced calling for the plan 

to be rejected. 

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This plan was developed after extensive consultation with Members of Congress, 

state, local and tribal officials, industry, and environmental organizations. We 

received comments from more than 100,000 interested citizens. Seventy-five 

percent of the comments received from the public supported some level of increased 

access to the domestic energy resources of the Outer Continental Shelf. We gave 

great weight to the desires of coastal states regarding oil and gas development near 

their shores. I point out that this plan excluded oil and gas leasing near 

environmentally sensitive whale migration areas in Alaska. It also proposed for the 

first time leasing an area off the Virginia coast but only after I personally talked with 

the Governor of the Commonwealth of Virginia who requested, and I consented to, 

the area being no closer than 50 miles to Virginia's shores. 

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My five-year plan was developed with both draft and final Environmental Impact 

Statements. I brought these documents with me to show the amount of extensive 

environmental analysis invested in the 5-year plan. Both of these environmental 

impact statements were submitted to the public. The final EIS was submitted to 

Congress for its review as part of the 5-year plan. 

A relevant fact is that these EIS's - along with environmental assessments and oil 

spill response plans - were based on the probability that a significant oil spill was 

small. The environmental impact statement used historical information and models. 

When the 2007-2012 five-year plan was written, there had not been a major oil spill 

in 40 years. 

One very real consequence of the Deepwater Horizon accident is that these 

historical assumptions will be forever changed. 

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The historic information now includes the fact that the BP oil spill is the worst oil spill 

in US waters. All future environmental impact statements will have to take this fact 

into account as well as change the probabilities of such accidents occurring. 

It is also my understanding that before I left office, a federal district court affirmed the 

adequacy of this environmental analysis. After leaving office, the O,C. Court of 

Appeals invalidated the part of the five-year plan that addressed oil and gas leasing 

in Alaska. The court said the Minerals Management Service was right to analyze the 

effects of impacts on the Alaska shoreline but had insufficiently analyzed the effect of 

drilling operations at well sites. The Salazar Administration went back to the Court of 

Appeals to insure the court had not invalidated the entire five-year plan. The court 

clarified its initial decision consistent with Secretary Salazar's understanding. 

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It is my understanding that development of leases already sold could continue and 

further non-Alaska leases could be sold while further environmental sensitivity 

analysis could be done. On March 31, 2010, Secretary Salazar released his 

preliminary revised program that I mentioned earlier. I 

It is also a relevant fact that in the five-year plan was the area that BP successfully 

bid on for its Deepwater Horizon operation. The process that was used to award that 

lease was the same process used to award thousands of other leases issued by 

both Democratic and Republican Administrations as established in regulations. The 

five year plan sets a schedule of lease sales. Energy companies submit sealed bids. 

The high bidder wins the lease after a process in which each high bid on a tract goes 

through an evaluation process to ensure the public receives fair market value before 

a lease is awarded. 

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It's my understanding that environmental Impact statements are also written for 

mUlti-lease sales. In the case of the BP lease sale, a further environmental 

assessment was approved by our then MMS Director, Randall Luthi. That 

environmental assessment was, as I understand, never legally challenged. 

I mention this in part to show the extensive environmental analysis that was invested 

in the 5-year plan and lease sales. It is also clear, as I mentioned, that the historical 

assumptions these plans use will be forever changed to include the historical data of 

the BP oil spill. 

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4. Accelerated Development of Next Five-Year Plan to 

Give The Next Administration More Lead Time To Develop Their Plan 

A fourth policy development was that the Interior Department took action, as allowed 

by law, to give the next Administration a two-year head start in writing the next five 

year energy plan. Specifically, we issued a request to all parties that they comment 

on what the next five-year program should consider. The governors of all 50 states 

were to be asked for their comments, particularly on issues unique to each state. 

I said at the time, and I quote "This initiative could provide a SignifiCant advantage for 

the incoming administration, offering options it would not otherwise have had until at 

least 2010. Today's action would provide a 2-year head start for the next 

administration on developing a new five year program." 

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I made the decision to not exclude any outer continental shelf area from 

consideration so that the next Administration would have a free hand to write its own 

plan. 

5. Alternative Offshore Energy 

A fifth Significant development was taking steps to implement Congressional 

direction and further the work Secretary Norton set in motion to develop offshore 

wind, wave and ocean current energy. At the time, I believed, and still do, that this is 

a new energy frontier for the nation. Specifically, we issued the Final Programmatic 

Environmental Impact Statement for the Outer Continental Shelf Alternative Energy 

and alternative use program. We also announced an interim policy that would allow 

new facilities to test and collect data on alternative energy in federal offshore waters. 

I would also add that we emphasized the development of geothermal energy, and 

sold a record amount of geothermal leases during my administration. 

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6. Budgets and Coastal Impact Assistance 

Part of my responsibility as Secretary was developing the Departmental Budget that 

includes the Minerals Management Service. In both budgets, the combined totals of 

appropriated funds and offsetting receipts were higher than when I took office. 

Within the overall Minerals Management Service budget, funds for its regulatory 

program in the two budgets I submitted were $2 million and $1.4 million above levels 

set by Congress in the previous years, including both appropriations and offsetting 

receipts. Several increases specifically targeted the Gulf of Mexico and deepwater 

activities. 

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We also implemented a Coastal Impact Assistance program that shared more 

revenue from oil and gas leases with states adjacent to the development .of these 

offshore leases. This provided $1 billion in additional revenue to six states over a 

four year period. In my last year in office, the Interior Department disbursed a record 

amount of onshore and offshore energy revenue -more than $23 billion as I 

mentioned earlier - to federal, state, local and tribal govemments. 

Mr. Chairman, I close with two final thoughts. 

First, as a former governor, I urge Congress and this Administration to work closely, 

hand-in-glove, with the Governors of Mississippi, Alabama, louisiana, Florida and 

Texas. These Governors, Haley Barbour, Bob Riley, Bobby Jindal, Charlie Crist, 

and Rick Perry, are proven leaders, passionate about their states and their citizens, 

and pragmatic about finding solutions. They and can be essential allies to clean up 

the oil spill. 

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As a former Governor, I know what they are experiencing in the wake of this 

tremendous tragedy. They will be tremendous resources to restore damaged 

communities and natural resources. 

Second, the consequence of the Deepwater Horizon accident is that it will forever 

change the offshore energy industry. Never again will a Cabinet Secretary take 

office and be told that more oil seeps from the seabed than has been spilt from 

drilling operations in U.S. waters. Never again will decision makers not include 

planning for events that might be low-probability events, but which, in the unlikely 

event they occurred, would be catastrophic. 

With that, I will respond to your questions. 

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Mr. STUPAK. Let me thank both secretaries for your testimony 

and thank you again for voluntarily appearing. Caution to members. We have 34 members here, and if we all take five minutes 

each, that is going to bring us pretty close to the three-hour limit. 

So I am going to be going to push members to keep your questions 

within that five-minute range. Otherwise we will have a runaway 

committee as opposed to a runaway well. And we will try to keep 

some control of it. 

Let us begin with Chairman Waxman for questions please. 

Mr. WAXMAN. Thank you very much, Mr. Chairman. I will abide 

by your admonition on the time. Secretaries Norton and Kempthorne, I have some questions about the goals of the Bush Administration’s national energy policy. President Bush and Vice President 

Cheney’s energy task force suggested several ways to boost offshore 

production of oil and gas. 

The Cheney task force recommended that the Interior Department offer new economic incentives to encourage industry to pursue offshore oil and gas development. These incentives included a 

proposal to reduce the royalties private companies have to pay the 

American people when they take oil and gas from public land. The 

task force also recommended that the Interior Department identify 

and reduce impediments to exploration and production both onshore and offshore. 

Secretary Norton, were those components of the Bush energy 

plan? 

Ms. NORTON. To the best of my recollection, Congressman, as to 

economic incentives, we employed the economic incentives on royalty relief that were put in place by—— 

Mr. WAXMAN. My question is the general statement of that energy plan was to provide incentives and to reduce impediments in 

order to develop more energy supplies. Wasn’t that what the plan 

was all about? 

Ms. NORTON. We were facing a very serious energy crisis at that 

point in time. 

Mr. WAXMAN. I am not asking for justification. There is nothing 

wrong with that. 

Ms. NORTON. We were looking to increase the energy production. 

Mr. WAXMAN. Now, immediately after the task force released its 

report, the President issued two executive orders. Now, this task 

force that Vice President Cheney chaired was a subject that I know 

a lot about because I was trying to just find out who he met with, 

and we never even got the list of the executives from industry that 

he met with. I don’t know what the secret was all about, but I had 

to go to the Supreme Court to try to get that information. 

So the task force released its report. Then the President issued 

two executive orders intended to increase energy production. One 

of these orders required agencies to compile every rule making and 

analysis of whether the rule would adversely affect energy supply. 

The other order directed agencies to expedite a review of energy 

exploration permit and accelerate the completion of energy-related 

projects. Secretary Norton, in August of 2001, Stephen Guiles, your 

deputy secretary, wrote a memo to the Council on Environmental 

Quality stating that the department ‘‘is fully committed to playing 

a role in this effort.’’ Secretary Norton, during your tenure, did the 


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Department of the Interior support President Bush’s policy of expediting drilling on the Outer Continental Shelf? 

Ms. NORTON. We took many actions looking at what could be 

done to make sure that the permitting in place and so forth was 

done in—— 

Mr. WAXMAN. You were trying to—— 

Ms. NORTON. It really was not—— 

Mr. WAXMAN [continuing]. Comply with the policy of the administration, weren’t you? 

Ms. NORTON. There was really not much change as to the OCS. 

We worked primarily at on-shore areas and the permitting process 

in those areas. 

Mr. WAXMAN. OK, I have a limited time, but the answer is yes. 

You were trying to do this within your purview. 

Secretary Kempthorne, when you lead the department, isn’t it 

true that the Bush Administration plan and the resulting Energy 

Policy Act of 2005 specifically encouraged deepwater and ultra 

deepwater drilling in the Outer Continental Shelf. 

Mr. KEMPTHORNE. That was so. 

Mr. WAXMAN. OK, what concerns me is that in the task force report and the President’s executive orders, I have no problems with 

those reports in themselves. But I don’t see any consideration for 

the importance of improving drilling safety while we encouraged 

more exploration. Committee staff reviewed your testimony each of 

you gave to the Congress when you were secretary and found no 

discussion of strengthening safety standards for blowout preventers, no discussion of best practices for well design, and no discussion of how we assure that industry can respond to a large oil 

spill. 

Both of your testimonies talk about the safety record of offshore 

drilling, but it seems to me that one of the things we have learned 

is that deepwater and ultra deepwater drilling might involve different risks than shallow water drilling and it wasn’t appropriate 

to rely on assurances based on shallow water drilling experiences. 

I am not trying to lay the Deepwater Horizon disaster at the feet 

of the Bush Administration. In fact, I look forward to hearing from 

Secretary Salazar on some of these same questions. But I am trying to understand how we got here today, how Congress and the 

regulators accepted the industry’s promises of safety as we press 

full steam again into the deepest waters of the Gulf of Mexico without verifying that industry could deliver on its promises. 

It is as if we said we are going to raise the speed limit to 100 

miles an hour without thinking twice about how to strengthen seatbelts or improve airbags. The American people deserve these answers. They deserve an energy policy that considers the need for 

better safety rules as industry takes greater risks to find oil and 

gas. 

Thank you, Mr. Chairman. 

Mr. STUPAK. Thank you, Mr. Chairman. Mr. Barton for questions 

please. 

Mr. BARTON. Thank you, Mr. Chairman. I am going to try to hold 

it to the five minutes just as Chairman Waxman did. I might point 

out that if we had followed regular procedure and had the incumbent Cabinet secretary here first where most of the questions are, 


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we wouldn’t take up as much time with two prior Cabinet secretaries who have no official standing, but that is just me kind of 

saying we ought to use the regular order instead of this unusual 

order. 

But having said that, we are glad you folks are here. As we all 

know, the Jones Act requires U.S. flag ships with U.S. crews to operate in the Gulf of Mexico, but we do have existing statutory authority that the President can waive that in times of emergency. 

We had a lot of international equipment that was available to come 

help us with the oil spill that wasn’t allowed to come because the 

Obama Administration wouldn’t waive the Jones Act. 

Do either of you have a comment on that? 

Ms. NORTON. While this was not anything that I dealt with directly, I do know that the situations that occurred with large oil 

spills in recent history had been in other countries. And so other 

countries have learned from those experiences. And it makes sense 

to me to take advantage of the equipment and the personnel that 

are available. I do know that President Bush waived the Jones Act 

as quickly as possible after Hurricanes Rita and Katrina so that we 

could bring in assistance from other countries. 

Mr. BARTON. Secretary Kempthorne. 

Mr. KEMPTHORNE. Mr. Barton, the magnitude of this catastrophe 

would suggest that you should be able to array all assets made 

available to you, and I do not believe that was what occurred. 

Mr. BARTON. OK, we have also given authority to waive certain 

EPA environmental review requirements in times of emergency. 

This authority was used in Katrina. Several governors of the gulf 

coast, the governor of Louisiana, I believe the governor of Mississippi, asked for such a waiver. As of yet, that waiver has not 

been implemented, and so you had the ironic situation where the 

Coast Guard was attempting to facilitate the creation of berms to 

prevent known oil from reaching the beaches, and yet the EPA was 

refusing to grant a waiver so that—because of some potential impact that was unknown at the time. 

Do either of you have a comment on why the Obama Administration wouldn’t listen to and work with the affected governors of the 

states on this issue? 

Ms. NORTON. Once again, drawing from the Rita and Katrina experiences, we tried to do everything we could to move ahead as 

quickly as possible with common sense. And I really cannot comment about all the aspects of the current administration’s decisionmaking. I am not there. I don’t know the details. 

Mr. KEMPTHORNE. Mr. Barton, if I may add, I referenced in my 

comments that we need to utilize these governors, very talented 

people. When I was governor of Idaho and we had Katrina and 

Rita, I was in continual telephone communication with Governor 

Barber, Governor Blankill, Governor Perry. On a moment’s notice, 

they would say the needs that they might have, and I could implement the Idaho National Guard. C130 it would leave, a variety of 

things, a convoy that would go because they would run out of diesel 

fuel for first line responders. 

We moved faster than the federal bureaucracy was moving. We 

are still the United States of America, and this working together 

with the states, I think, can yield great results. And so again I just 


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urge the partnership with those that are down in the gulf coast region. 

Mr. BARTON. There is one more question I want to ask in the last 

one minute. Much is made by some of my friends on the majority 

of the fact that when we passed the Energy Policy Act, we put in 

some ultra deep language, and when that language was implemented, the Clinton Administration made the decision not to require a price trigger for royalties, but we did provide a volumetric 

trigger. 

Those were put in place when oil per barrel was below $30 a barrel. I think it was even below $20 a barrel. Obviously now it is $70 

or $80 a barrel. It makes no sense not to have some sort of a price 

royalty trigger. But it was the Clinton Administration that made 

that decision initially, not the Bush Administration. Isn’t that correct? 

Ms. NORTON. Yes, Congressman. We found that the Clinton Administration had omitted price thresholds from some of the leases 

that were issued. My administration put in place price thresholds 

on all of the leases that went forward. 

Mr. BARTON. The new leases. 

Ms. NORTON. On the new leases. 

Mr. BARTON. OK. 

Ms. NORTON. There has been a lot of litigation about that, and 

I won’t go through the history of—— 

Mr. BARTON. Well, in hindsight, you know, we should have had 

a price trigger, but a contract is a contract. So we put them in 

place for future. But since the Clinton Administration didn’t have 

them in place at the time when prices were so low, those contracts 

have been honored. 

With that, Mr. Chairman, I know my time is expired. And I 

thank you, and I thank our two witnesses for being here today. 

Mr. STUPAK. Thank you, Mr. Barton. Secretary Kempthorne, you 

were secretary when the lease sale for 206, which included the BP’s 

McCondill well was let. Is that correct? 

Mr. KEMPTHORNE. That is correct. 

Mr. STUPAK. And I believe you said that it was a big sale record. 

$3.7 billion was the lease sale for 206 including $34 million for the 

block containing the McCondill well. And you indicated that we 

had won the championship. We had won the championship, but one 

of the things we have been struggling with is a bad actor policy. 

For instance, British Petroleum has 760 violations, egregious willful violations in a five-year period, where the next biggest oil company has only eight. 

Was there anything that you could have done as secretary and 

said thank you for your bid of $34 million, but we are not going 

to let you drill in this area based on your past record? Is there any 

authority for you to do that? 

Mr. KEMPTHORNE. Mr. Stupak, I don’t believe that that is part 

of the current matrix. 

Mr. STUPAK. If it is not, should it be? Should the secretary be 

able to say thank you for the bid. Even though we are the highest 

bidder and we have to give you this lease, we are not going to because of your past history? 


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Mr. KEMPTHORNE. Mr. Chairman, many of us in our daily lives 

and decisions we have to make have to do due diligence. If that 

could be part of the matrix, I think, is certainly a very fair question. 

I would also, if I may, Mr. Chairman, with regard to winning the 

championship, we were there in the big dome of the New Orleans 

Saints, and it was an atmosphere of New Orleans trying to come 

back. And so it was in that context. 

Mr. STUPAK. Well, they did win the big championship. 

Ms. NORTON. Mr. Chairman, if I could just add a quick comment 

on—— 

Mr. STUPAK. Sure. 

Ms. NORTON [continuing]. The substance of your question. I 

think it makes sense to have a bad actor set prohibition against 

participating. I do think there are some problems with entering 

into subjective aspects of the decision making about who wins the 

highest bid. I think having a clear high bid and awarding on that 

basis is something that provides a lot of protection against manipulation of the system. 

Mr. STUPAK. Well, right now the law requires you if it is the high 

bid, you have to accept it, right? 

Ms. NORTON. That is right. 

Mr. STUPAK. No matter what the history is. 

Ms. NORTON. Having a separate bad actor provision makes a lot 

of sense. 

Mr. STUPAK. Let me ask you this, Secretary Norton. Throughout 

our investigation, we have learned that Deepwater Horizon explosion was caused by a series of shortcuts that BP took in the final 

hours and days before the explosion. The final step in the disaster 

was the failure of the blowout preventer to cut the pipe, stop the 

blowout, and seal the well. 

BP’s CEO Tony Hayward called this device a failsafe and indicated that he and British BP officials were shocked when it failed. 

Frankly, I am surprised that anyone would be surprised given the 

mounting evidence that BOPs weren’t failsafe at all 

In 2001, MMS received a report that concluded that all Sub-C 

BOP stacks should have two blind shear rams to reduce the likelihood of a blowout. Blind shear rams are used to—used as a last 

resort in emergency to cut through the drill pipe and close an outof-control well. 

So, Secretary Norton, after receiving this report, did the Department of Interior require two blind shear rams on Sub C BOPs? 

Ms. NORTON. The Department of the Interior looked at the issue 

and addressed it with a regulation saying that blind shear rams 

must be capable of shearing the drill pipe and that they have to 

be sufficient for the—— 

Mr. STUPAK. But you didn’t require two as was recommended? 

Ms. NORTON. We required four types of blowout preventers be 

present on each of the wells. 

Mr. STUPAK. That was above the surface. 

Ms. NORTON. We have a quintuple. 

Mr. STUPAK. I am talking about subsurface. The ones that you 

required was surface BOPs, which are easily accessible. We are not 


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dealing with a mile down. I am talking about Sub C, and the report 

dealt with Sub C. 

Ms. NORTON. In order to—our regulation required that there be 

a blind shear ram that was sufficient to address the situation. 

Mr. STUPAK. But the recommendation was two so we had a 

backup redundancy so we could have a failsafe system. And do I 

understand you didn’t require the two then? 

Ms. NORTON. Regulations do not require two. That is something 

that can be looked at in the future. 

Mr. STUPAK. Right, you issued a regulation in 2003, and you 

didn’t make it part of it. 

Ms. NORTON. The experts in MMS looked at that issue and determined that what needed to be addressed was having—— 

Mr. STUPAK. That they should be able to do it, but they recommended two. 

Ms. NORTON. They set in play—— 

Mr. STUPAK. Let me ask you this though. 

Ms. NORTON [continuing]. That said they had to be able to address—— 

Mr. STUPAK. My time is just about up. MMS received another report that painted, and I quote, ‘‘a grim picture of the ability of the 

BOPs to cut pipe when necessary.’’ In response, MMS took one 

minor step. The agency began requiring each well operator to provide information showing that the BOP blind shear ram was capable of shearing the drill pipe, as you said. But it is unclear to what 

extent this information was reviewed. 

Frank Patent, the New Orleans district drilling engineer for 

MMS, testified before the Marine Board of the investigation on this 

Deepwater Horizon and said that he was never told to look for this 

information when reviewing drilling applications. 

So my question is how do you explain Mr. Patent’s testimony? He 

was the New Orleans drilling engineer, and yet even he seemed to 

be unaware of requirement that companies demonstrate that blowout preventers could even cut the pipe? 

Ms. NORTON. The regulations are there. They are very clear 

about the need to have blowout prevention devices that are going 

to function in the circumstances. They have to be maintained. They 

have to be checked, and I can’t address what happened several 

years after my watch and why he may not have had that information. 

Mr. STUPAK. But when you did the final regulation, you had 

about three reports to your agency and you issued a final rule in 

2003. You just had verification that companies were supposed to 

verify that they had ram shear, not two, just one ram shear, correct? 

Ms. NORTON. If you look at Secretary Salazar’s 30-day report to 

the President following the Deepwater Horizon disaster, they 

looked at those studies and found that those studies reinforced the 

regulation as it was written. 

Mr. STUPAK. I am looking at the federal register which would be 

your rule that you submitted, and it was absent of all that. You 

left it to the discretion of the oil companies. 


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Ms. NORTON. We put in place a requirement that they had to 

have sufficient blowout prevention devices to maintain control of 

the well. 

Mr. STUPAK. Mr. Burgess, questions? 

Mr. BURGESS. Thank you, Mr. Chairman. We have heard some 

references—and Secretary Kempthorne, I really appreciate you 

bringing up the role of the states in the response to what has happened in the gulf. And it seemed like what should be all hands on 

deck all the time isn’t exactly what is happening. We have heard 

it referenced here a couple of times in the Q and A period. 

We have taken now—I have taken three trips down to the gulf. 

Governor Jindal very much publicized recommendation that he be 

able to build sand berms to the east of the Chandelier Islands to 

protect those areas. Our last trip down there, we heard about the 

placement of some rocks, building rock berms in some of the—near 

some of the barrier islands, near Grand Isle, Louisiana because if 

the oil enters through the cuts in the barrier island, then getting 

into that very sensitive area of the interior will—the recovery period could be quite, quite prolonged. 

So the mayors and the parish commissioners are desperate to be 

able to put the rocks in place. They are desperate—BP has provided the rocks. They are sitting on barges in the Mississippi. They 

can’t sit there forever. Sooner or later, they are either going to 

have to be used or sent back, and it is this type of tension between 

the folks on the ground, secretary of interior, the Environmental 

Protection Agency. 

Do either of you recall—you have dealt with some pretty big disasters between Rita and Katrina, and, Secretary Kempthorne, I 

think you had some big forest fires that went on during your tenure. Do you ever recall having this type of tension between the various federal agencies that are responsible for controlling the disaster, the cleanup thereafter, and the overseeing the effects on the 

environment? Can any of you recall this type of scenario? 

Mr. KEMPTHORNE. Congressman Burgess, again it is catastrophic 

in its sheer magnitude. Yes, it is going to be stressful for everybody 

involved, but I like your adage of all hands on deck. I think if you 

can create an atmosphere of collaboration, of utilizing the resources 

that you have, identifying what is the major hurdle that we have 

currently facing us? What can we do? What are the assets that 

could be deployed? Where might we have flexibility? Where might 

we be able to go and utilize some practices that, based on past 

practices, we think would have a benefit? 

The barrier islands is a project that has been reviewed for some 

years because you, in essence, have lost the barrier islands. There 

does need to be the restoration of those. I think the term was to 

the 1917 topographic area. It is something that the governor has 

been fully engaged on. I was engaged on as secretary of the interior, and, yes, I do think we should be moving in that direction. 

And I do think that you can have waivers so that you can do the 

pragmatic without causing long-term adverse consequences. 

Mr. BURGESS. But this is really troubling, and the problem is 

that everybody sits in a room. Someone at some level says no, and 

then that’s the end of the discussion. And there should be—I think 

there is under the whole pollution act, one guy who sits at the 


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other end of Pennsylvania Avenue who is able to cut through all 

that and get this stuff done, who has that flexibility. And it is the 

nonengagement of the White House right now in some of these 

things that is so frustrating. 

Mr. KEMPTHORNE. Congressman Burgess, when I was secretary 

of the interior, we had a water crisis down in southeast part of the 

country, Alabama, Georgia, and Florida, and it was escalating. And 

I was told after a cabinet meeting I was going to southeast United 

States. And I said why am I going? Because the President wants 

you to step into this and see what we can do to resolve it. By getting all the principals in one room with the assets with the authority, you are able to calm and have a path forward with the proper 

decisions made. 

Mr. BURGESS. Seems in this case, we get everybody in the room, 

and then someone says no. And then we have got two more weeks 

to go to get another answer. Let me just ask a question to either 

one of you. How difficult—Secretary Kempthorne, you referenced 

that the people were let go from MMS after some of the difficulties. 

How difficult is it to fire someone from a federal agency like 

MMS? 

Mr. KEMPTHORNE. There is due process. You have to protect the 

rights of the individual, of the employee. You can imagine how difficult it was for me in that particular hearing knowing that we 

were issuing letters to employees that they are going to be dismissed, but there is a 30-day clock that is running to see if they 

are going to contest it. And then what due process do we have? 

So it is the law that has been implemented by this body that we 

adhere to, and it is proper because you protect the rights of the individuals. 

Mr. BURGESS. But let me just ask are these individuals covered 

by union contracts? 

Mr. KEMPTHORNE. I don’t know, sir. 

Mr. BURGESS. Is MMS part of a federal union, a federal employees’ union? 

Ms. NORTON. I am not aware that it is, but I really don’t know. 

There may be some employees, but I am not sure how they are affected. 

Mr. BURGESS. Mr. Chairman, I will yield back. 

Mr. STUPAK. Thank you, Mr. Burgess. Mr. Inslee for seven minutes for questions. 

Mr. INSLEE. Thank you. Thank the witnesses for being here. We 

are going to ask some questions today. I want to make sure you 

understand the purpose of my questions is to try to figure out how 

we move forward, not to make you feel uncomfortable. Although 

this is an uncomfortable situation. 

While the Cheney energy task force was going forward, it was secret. Many of us tried to obtain information about it. It was very 

frustrating that we could not. I think it is unfortunate now that 

that secret of the secret task force has been revealed, which was 

that the administration, that administration pursued a policy of a 

very, very large expansion of offshore drilling with no, as far as I 

can tell, commitment expansion of safety regulations. 

So I want to ask you why that is and how that occurred so we 

can see that that does not happen in the future. I want to follow 


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up on some of Mr. Stupak’s questions about the blowout preventer. 

It is really stunning to me that these blowout preventers were apparently considered a failsafe device, but all the information available to the department even then was that they were repeatedly 

failing. 

The study in December 2002 by West and Gerring, given to the 

department. It showed that 50 percent, at best, of them functioned 

when tested. And later on, we now know at 2009 that only 45 percent of them worldwide have been shown to work under real-world 

conditions. And yet, as far as I can tell, there weren’t actions taken 

to improve their performance despite the department’s known information about this. 

For instance, in 2003, MMS received a report concluding that oil 

and gas companies should ensure that critical backup systems, 

such as deadman’s switches and remotely controlled operator vehicles, actually worked. This seems like common sense. And we know 

on this particular rig, the deadman’s switch did not work. 

So I could ask you, Secretary Norton, after receiving the report 

requiring or suggesting that we ensure the performance of critical 

backup systems, did the department require testing of backup systems or ensure that Sub C BOPs had backup systems? 

Ms. NORTON. First of all, I have not had access to people in the 

Minerals Management Service to be able to describe and discuss 

what those procedures were exactly. I do know that we adopted a 

regulation that was a strong regulation requiring blowout prevention devices, and that was—some of that was done over the objection of industry. And we went further than industry asked to get 

regulations in place in 2003. 

Studies were done at the request of the department, and we 

looked at the results of those studies. And as reflected in Secretary 

Salazar’s report to the President, those studies and their results 

were incorporated in the regulations that were adopted by my department. 

Mr. INSLEE. Well, let me—— 

Ms. NORTON. If I can—— 

Mr. INSLEE. Go ahead. 

Ms. NORTON [continuing]. Point out that, you know, based on 

what we have seen and what has been reported in the media, it 

appears that BP violated all of those regulations that were on the 

books throughout the administrations. 

Mr. INSLEE. Thank you, and let me help you. Our research has 

shown that, in fact, you did not issue a regulation requiring performance standards for critical backup systems. You did not issue 

such regulation on deep sea subsurface blowout preventers, and 

this may have been one of the reasons this whole thing happened. 

I want to ask you about the cementing failure. One of the failures in this particular instance was in centralizing the pipe. You 

may have heard that essentially BP decided not to use the recommended number of centralizers, did not do a cement bond lock, 

did not use a lockup sleeve to keep the casing in place if pressure 

built up. 

So I would like to know during your term, Secretary Norton, 

were there any specific regulations put in place that would have required BP to adequately centralize the casing? 


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Ms. NORTON. I have to admit, Congressman, I don’t know what 

centralizing casing means. 

Mr. INSLEE. What it means is—— 

Ms. NORTON. However, I can say that our regulation required 

that a company used pressure—they had to pressure test the casing shoe, run a temperature survey, run a cement bond log, or use 

a combination of those techniques if there was any indication of an 

inadequate cement job. 

Mr. INSLEE. Well, let me help you out. I know that in June 2000, 

MMS proposed a new rule regarding cementing that raised the 

question whether to require industry best practices be forward. In 

other words, MMS suggested or at least considered at one time requiring prescriptive cementing practice requirements. 

After listening to industry, and as far as we can tell only industry, the agency apparently did not adopt those requirements. Are 

you aware of any independent studies commissioned by MMS to 

identify best cementing practices? Or did the department depend 

just on industry input in that decision? 

Ms. NORTON. I believe that the 2000 reference you are referring 

to was only as to producing wells and so would not have applied 

to the Deepwater Horizon situation. This is an issue that certainly 

needs to be looked at and considered based on the information that 

comes from what went wrong in the Deepwater Horizon situation. 

Obviously, there has to be a look at, you know, what regulations 

are necessary going forward. 

My general understanding is that we looked at the studies that 

were done and incorporated those requirements to the best estimate of the Minerals Management Service experts. 

Mr. INSLEE. Well, this was a consideration of cementing in the 

original drilling. That is when you do the cementing, and we have 

been told—our research has shown in June it was suggested only 

comments were received from the industry, and, as far as we can 

tell, you did not take any action regarding requiring specific practices in cementing. I just ask you just specifically. Did you require 

anything that required cement bond log tests? 

Ms. NORTON. Congressman, I am not an expert on cement bonds, 

and I really would have to get back to you with additional information because I do not know that level of detail. And as secretary, 

we did not look at that level of detail. We relied on the experts, 

really the ones who understand. 

Mr. INSLEE. Let me ask you a broader question. After the administration following the secret Cheney energy task force decided to 

greatly expand offshore deep water drilling, did you take actions to, 

in any significant way, improve the safety of deep water drilling? 

Ms. NORTON. We had a very strong safety program that was recognized internationally, and I personally attended a meeting of the 

International Offshore Safety Regulators, the equivalent of MMS 

from around the world. And the MMS program was very highly regarded in my discussions with people. 

Mr. INSLEE. I must—— 

Ms. NORTON. And I had—— 

Mr. INSLEE [continuing]. Regret to say—I am running out of 

time. I am sorry for the time. I would just like to close by saying 


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we regret that experience did not prove your observation correct. 

Thank you. 

Mr. STUPAK. Mr. Griffith, for questions please, five minutes. 

Mr. GRIFFITH. Thank you, Mr. Chairman. I think sometimes we 

get, or at least in my opinion, somewhat off the subject. I think we 

know the military axiom that after the first shot is fired, the battle 

plan goes to hell. 

So we can talk about cement. We can talk about regulations. We 

can talk about pressure gauges. We can talk about pounds per 

square inch, but the fact of the matter is that after this disaster 

occurred, did we recognize it? And after that first shot was fired 

or after that first blowout occurred, where was the leadership for 

the crisis? It was not to go back to the book and see who missed 

a pounds per square inch or who missed a sentence of a regulation. 

But as it occurred and as we watched it occur and unfold, did leadership recognize the significance of it and provide the leadership to 

correct it? 

That is really what this is all about. There will never be a document 10 feet high on the regulation of offshore drilling that will be 

foolproof and will protect us from this disaster. The question in my 

mind is who in the administration, in the executive branch, had 

the ability to call EPA, the Coast Guard, the governors, put them 

in a room, say to them this is a national tragedy and a disaster. 

Fix it. Where was George Patton during this disaster, or was there 

a George Patton there? I would like to hear that answer from either one of you. 

Mr. KEMPTHORNE. Congressman Griffith, I appreciate the analogy. I believe that our examples where that is exactly the type of 

process that must occur for results to be achieved. Did it or did it 

not? I am not in a position to comment, nor am I today going to 

sit here in criticism of my successor who has a very tough job and 

an unenviable position with the terrible thing that has happened. 

So again that is why I decline many media opportunities because 

I think the team on the field has to have running room. But I will 

tell you, Congressman, that that is the formula, and I have seen 

it time and time again. I believe unfortunately that when you have 

seen comments made that are contradictory of other comments 

within the same administration, it would suggest they are not in 

that same room. And that is something that I think is worth noting. 

Mr. GRIFFITH. Thank you, and I would like to yield the balance 

of my time to the ranking member, Congressman Burgess. 

Mr. BURGESS. I thank the gentleman for yielding. Mr. Chairman, 

I want to make a unanimous consent request. I have a report from 

the Department of the Interior dated May 27, 2010, ‘‘Increased 

Safety Measures for Energy Development on the Outer Continental 

Shelf.’’ Part three details existing well control studies, and they 

talk about the technical assessment and research program and list 

almost 25 studies of the funded well control research from 1990 

through 2010. The bottom line reads ‘‘The results of this study confirmed that the regulatory decision to require operators to submit 

documentation that shows the shear rams are capable of shearing 

the pipe in the hole under maximum anticipated surface pressures.’’ There is no notation as to the number of shear rams that 


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should be required. This is Secretary Salazar’s report, and again I 

think it answers some of the questions that were put to Secretary 

Norton during the previous lines of questioning. 

And then since I do have a few extra moments, let me just opine 

that one of the concerns that I have had with the current administration is the lack of transparency, that we keep hearing about the 

lack of transparency in the — with the Cheney energy task force. 

That certainly preceded my time, but I hope the chairman will help 

me when we make requests of the administration. I would like to 

know who was around the President’s table when perhaps he was 

advised by the energy czar, Carol Browner, when he was advised 

by Secretary Chu about what the response should be to control this 

well. The President said he had been assured that there were no 

real dangers in offshore drilling when he gave his speech earlier in 

the year. Who was involved in that? 

So I hope the chairman will join with me in an effort to gain 

more transparency from the administration when we request this 

documentation, and I will yield back the balance of my time. 

Mr. STUPAK. Gentleman’s time has expired. Mr. McNerney from 

California. Questions please, five minutes. 

Mr. MCNERNEY. Thank you, Mr. Chairman. Secretary Norton, 

Secretary Kempthorne, I certainly appreciate your thoughtful opening comments, and I appreciate your defense of the employees of 

the department. I haven’t been here that long, but my staff and the 

staff of all the committees, they work very hard. And they are committed, and they are patriotic. So I certainly appreciate most employees are very commendable. 

Now, I have a question. It is a simple question. Was there a philosophy during your tenure that there should be less or minimal 

oversight of offshore drilling and that the drilling operators were 

capable of policing themselves? So it is sort of an open-ended, philosophical question. You can go first, Secretary Norton. 

Ms. NORTON. Congressman, I believe there was an attitude, and 

frankly it was not one that we created by something we did, but 

it was a longstanding attitude of mutual problem solving, of really, 

you know—while MMS certainly had a regulatory and oversight 

role and they, in my experience, were diligent about that, they also 

wanted to work with the expertise that industry had. 

Industry was at the cutting edge, coming up with new technologies every day, and you can’t just sit back and be distant from 

that and still be able to have the proper regulatory and oversight 

law. 

Mr. MCNERNEY. Well, I mean the sort of thing I am thinking of 

is during, partly during your tenure, there was a drastic reduction 

in the ratio of inspectors to deep water wells, and that sort of reflects on, I think, the philosophy that I am trying to get at here. 

Ms. NORTON. I would be happy to provide additional information, 

but we requested a number of years increases in resources for the 

Minerals Management Service in order to keep pace with rising 

workloads. 

Mr. MCNERNEY. OK, I would like to follow up and ask a question 

about the exemption the Department of the Interior gave leasees 

during the Gulf of Mexico—or in 2003. Before 2003, leasees had to 

provide a blowout scenario with their exploration, development, 


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and production plans. The scenario was supposed to estimate what 

might happen in a blowout at the well site and include the flow 

rate, overall amount, and the duration of an oil leak from a potential blowout. In addition, leasees were supposed to provide information about their ability to secure rig, drill a relief well, and how 

long that drilling might take place. That sounds like a good idea. 

Do you agree that that would be a good thing to have? 

Ms. NORTON. We have looked at that particular issue that you 

raised and tried to determine exactly what some of those documents meant. My best reading of it is that that information was 

viewed as having been provided in a different set of documents 

with a broader application. And the document you are referencing 

is simply saying it did not have to be duplicated in other documents. 

Mr. KEMPTHORNE. Congressman, may I respond to your first 

question—— 

Mr. MCNERNEY. Sure. 

Mr. KEMPTHORNE [continuing]. So that I am on record. The question whether or not there was an effort or philosophy to have less 

or minimal oversight. 

Mr. MCNERNEY. Correct. 

Mr. KEMPTHORNE. And I would say absolutely not. Absolutely 

not. Repeatedly, the atmosphere and the philosophy was that we 

achieve the highest of environmental standards, that we do protect 

the environment. We do know that there is a need for the wellbeing of the families so that we have fuels so that they can have 

an economy, so that they can have warmth, so that they can 

produce food. But that you do not do that at the risk of jeopardizing the overall environment. 

I would also just note that MMS’s civil criminal penalties program pursued from 2001 to 2008 280 cases of noncompliance with 

MMS regulations, and the last three years was the highest area 

where that was pursued. 

Mr. MCNERNEY. OK, I am not sure that the results of those 

years, in my mind, line up with what you are saying or align with 

what you are saying. It appears in my mind that there is more reliance on industry to clean itself up and to police itself. And that is 

basically what happened with BP. They weren’t given enough oversight, and I was going to follow up again with Secretary Norton. 

Then in 2003, the Department of Interior created an exemption 

for the blowout scenario requirement that I mentioned earlier. And 

in my mind, that exemplifies that philosophy of less oversight and 

more reliance on industry. It appears that my time is up. So I yield 

back. 

Mr. STUPAK. Thank you. Mr. Shimkus for questions, five minutes. 

Mr. SHIMKUS. Thank you, Mr. Chairman. Again I appreciate you 

all coming, and in my opening statement, you know, I talked about 

command changes and taking responsibility. First question is when 

you were both sitting secretaries, do you remember a hearing 

where the previous secretaries going back to the Clinton Administration were asked to testify on the same day that you were testifying? Secretary Norton, did that ever happen? 

Ms. NORTON. No, that did not. 


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Mr. SHIMKUS. Secretary Kempthorne. 

Mr. KEMPTHORNE. No, sir. 

Mr. SHIMKUS. Thank you. You know my good friend from Illinois, 

Congressman LaHood, Secretary of Transportation now. And I 

don’t think he has had any testimony coming up here where he has 

had Secretary Peters or Secretary Minez. So it is just interesting 

that we are doing in this light, but having said that, what I have 

been—we know it is a catastrophe. We are hoping the cap holds. 

We are doing the cleanup. BP should be held responsible. I think 

we are all in, you know, on that message and focus on helping, you 

know, the gulf coast states recover. 

And the issue is how do we decrease our reliance on imported 

crude oil. And, I think, Secretary Norton, you kind of talked about 

the change after September 11, understanding that we have to 

really get away, and I am an all-of-the-above energy guy. Nuclear, 

solar, wind, coal-to-liquid, OCS expansion. 

In fact, I did mention in my opening statement President Obama 

talking about a new, green—moving on a carbon bill would include 

opening up more OCS. I mean that was a week before this disaster 

happened. So do you think—and I rely a lot on my friend and colleague and roommate, Steve Scalise, on some information on gulf 

issues. Is a moratorium an appropriate response, stopping operating wells that are, you know, operating in line right now? Is that 

a proper response? I understand doing research on the disaster, but 

a moratorium, Secretary Norton? 

Ms. NORTON. In my mind, to go back to my aircraft analogy, you 

don’t ground all of the airplanes because there was one problem. 

You have to look and, as they did, do a complete up-and-down inspection of the existing rigs and make sure that that problem 

doesn’t exist. There might be other steps that should have been 

taken. Maybe they were, and maybe they weren’t. But the important thing is to address the issues, not send the drilling rigs overseas where they may not return for many years and not send the 

jobs to other countries in order to resolve the issue. 

Mr. SHIMKUS. Secretary Kempthorne. 

Mr. KEMPTHORNE. Yes, Congressman, I believe that the action 

was taken which was a safety review immediately after where they 

look at, in the deep water, some 30 different drill rigs. After that 

review, I think there was only one area of noncompliance. Everything else was being adhered to with regard to the regulations that 

are on the books. That was appropriate. 

The gulf coast is being devastated, and all of us are for safety. 

But I believe, Congressman, the result, if a moratorium is put in 

place, is the only absolute is that you will further cause disruption 

to the economy of the gulf coast states when really they need to 

have an opportunity for recovery. 

Mr. SHIMKUS. And just let me—and I will end on this. In my 

opening statement, I talked about the Diamond Offshore announced Friday it is an Ocean Endeavor drilling rig was moving. 

This was July 9. I have Brazil sees silver lining, more rigs. Three 

deep water drilling rigs to be moved from sites south of Cameron 

Parish. 

If they are in the process of moving, as some are, do they come 

back, Secretary Norton? 


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Ms. NORTON. In my experience, those are long-term contracts, 

and once they are moved, once you go through the trouble and expense of moving them away, then they tend to stay in those locations. And it is going to be very hard for that industry to be rebuilt. 

Mr. SHIMKUS. Secretary Kempthorne. 

Mr. KEMPTHORNE. I agree with that statement, Congressman. In 

the big picture, how far are we away from having another situation 

that may see us at $4 a gallon gasoline? We are too reliant upon 

foreign sources of our energy. We are too reliant, and so if we now 

pursue a policy that continues to diminish our own development 

here within our own shores on our own land, I do not think it bodes 

well for the country. 

Mr. SHIMKUS. Thank you, Mr. Chairman. 

Mr. STUPAK. Thank you, Mr. Shimkus. Mr. Melancon for questions. Five minutes, sir. 

Mr. MELANCON. Thank you, Mr. Chairman. Secretary Kempthorne and Norton, thank you all for being here today. First, let 

me just say that I agree with the analogy of the rank-and-file MMS 

employees. I think the morale particularly in Louisiana is very 

down. The harsh criticism for people that are trying to do the right 

thing. My concern is that they don’t want to do anything for fear 

of being criticized, and that is going the wrong direction. So I understand, I think I understand human nature. 

During your period, Secretary Norton, do you recall how many 

times that you may have had any oversight hearing that you participated in that dealt with OCS drilling or any of the rules or regulations or legislation that was going forward? Do we have a reauthorization in there anywhere? 

Ms. NORTON. We dealt issues usually as one small part of the 

discussion of the overall especially Energy Policy Act of 2005. 

Mr. MELANCON. Was there anything, any legislation that came 

forward that addressed OCS in ’01 or ’03? 

Ms. NORTON. Ordinarily what we dealt with and what you dealt 

with were questions about where, you know, what areas should be 

open for exploration and production as opposed to the specifics. 

There were also, of course, issues as to incentives and whether 

those should exist or not. That is my main recollection. 

Mr. MELANCON. And where I am—what I am trying to understand, and this goes back to, I guess, the first hearing that we had 

here since the Deepwater Horizon incident, and Mr. Dingell 

brought up the subject of the waiver of Neepa, waiver of the Environmental Impact Statement. And my appreciation and understanding is that somewhere along the line the law or rules were 

changed that provided that you had to be able to do the EIS within 

30 days or the department got the option of waiving the EIS. 

Ms. NORTON. I think what we see overall, The Outer Continental 

Shelf Lands Act creates a structure of five-year planning, and there 

are various stages in that process where extensive environmental 

analysis is done. And each of the subsequent steps relies on the 

blotter analysis and the more in-depth analysis. It is done on this 

regularly scheduled basis. 

The categorical exclusion issue that has been discussed is one 

that really goes back to procedure in place since the 1980s and was 

not changed, as far as I know, within my administration as to the 


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offshore activities that we have been talking about. That is the best 

of my recollection. 

Mr. MELANCON. Now, because I guess some of the concern that 

I have is that, the difficulty I have is understanding how do you 

waive the law and who gets that authority? After Katrina, I 

couldn’t get people to waive rule, much less an idea that might 

have been good or bad. And so if there was, you know, a law—and 

this is one of the things I have not investigated to a large extent. 

NEEPA was there. EIS was required. Would it had to have been 

law to change the—give a waiver? 

Ms. NORTON. If I can understand the key issue here, there is in 

NEEPA a provision for what they call categorical exclusions, and 

we did put some of those in place for everything from fuels treatments for forest fire prevention to some of the energy issues. And 

when we did that, we did that by looking in depth at, you know, 

what the analysis had shown in the past, how the process worked, 

and how that particular issue fit in with our environmental decision making. 

And so some of—and we had to go through the Council on Environmental Quality that has to approve the categorical exclusions. 

And so while I know we did that process on some things, I don’t 

think we changed anything on the offshore issues. 

Mr. MELANCON. If I were secretary and I wanted to find out if 

somebody—if there were a person in the department that I could 

go and ask the question of can you tell me how this waiver came 

about, who would I be able to go and ask that, would have the institutional knowledge or would be able to maybe answer that question for me? 

Ms. NORTON. We can get back to you with some answers. 

Mr. MELANCON. I mean I am not—I am just trying to figure out 

how we got to that point, and—because I can’t seem to get anybody 

to give me a concise answer of how that waiver came about. And 

particularly if it is, in fact, so, how several states got no waivers 

and you had to go through the EIS—and my time has run out— 

and some, to waive it, it couldn’t be done in 30 days. But that is, 

I think, the time, and thank you for being here and yield back. 

Mr. STUPAK. Thank you, Mr. Melancon. Mr. Latta for questions 

please. Five minutes. 

Mr. LATTA. Thank you, Mr. Chairman. And again to our witnesses, thanks very much for appearing before the committee 

today. Really appreciate your testimony and your time, and lots of 

questions to ask in five minutes. But we are not going to get to 

them all. 

But, Madame Secretary, I was interested on page four of your 

testimony, that if I could just repeat a little bit of it. You said 

‘‘without question the most powerful OCS experience for me was 

the 2005 hurricane season. Over 4,000 offshore platforms were operating in the Gulf of Mexico when Hurricanes Rita and Katrina 

pummeled the area. Safety and spill prevention managers were put 

to a severe test.’’ Going on, you said ‘‘a number of the mostly older 

platforms were destroyed by the storms fury. Amazingly despite 

the strength of the hurricane, the amount of oil spilled from the 

wells and platforms was quite small. The shutoff valves located at 

the sea floor operated as intended. They prevented oil from leaking 


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into the ocean even when the platforms were severely damaged. 

The spill prevention techniques upon which the industry and government relied on passed the hurricane test.’’ 

And this is kind of where you had to look in that giant crystal 

ball. We had testimony recently from—pardon me—from BP, Mr. 

Hayward. And listening to the testimony, a lot of us were looking 

and thinking, you know, was this a lot of human error? Because 

if, you know, again if we are talking about 4,000 rigs that were out 

there at the time and they were put to that supreme test, what 

happened here? If you could just maybe hypothesize about that. 

Ms. NORTON. Obviously we really need to have the answers from 

the scientific inquiry before any of us can say exactly what happened. You know based on the reports that I have read, it certainly 

looks like there were a number of decisions made in those last few 

days and hours that need to be called into question and may show 

us that there were violations of the standards that should have 

been applied. 

Everybody involved with the offshore industry has always understood that this is a very challenging environment, and it is one 

where there have to be very high performance standards. And the 

performance that we saw in the hurricanes met those standards 

and really gave me a great deal of confidence that we had systems 

in place that worked and could work well. 

Mr. LATTA. Please follow up then. As your experience as secretary at the department, you said just now that maybe something 

was occurring just prior to this accident. How often would someone 

from MMS or the Department of Interior be seeing what was going 

on on this rig or any changes that would have occurred that maybe 

something here on the federal side would say maybe you shouldn’t 

be doing that? 

Ms. NORTON. It is my understanding there would be fairly regular communication. Have to have a helicopter to fly out to the rig 

to actually have an inspector there, and that—the frequency of that 

depends on a lot of different factors: the weather, the timing of 

being able to do monthly visits and so forth. But there was very 

frequent communication by telephone and so forth between people 

in the MMS and the offshore platforms as I understand it. 

Mr. LATTA. Thank you. And, Secretary Kempthorne, first I want 

to respect you not wanting to second guess the folks who have come 

after you, but some of us were down at the coast earlier in July, 

this month. And again we talked to a lot of those local officials, 

and, you know, we were just confounded as to, you know, the lack 

of getting back and forth from the local side and back up through 

the chain of command on the federal side. 

And, you know, I also noticed in your testimony that as you read 

it that, you know, you were talking about the governors down in— 

always second guessing the folks down there. Now, and I know you 

just said you don’t want to second guess, but, you know, from what 

you have seen, could the local officials on the ground actually have 

been right on some of these decisions that they have seen since 

they were there but they are being again overruled by the federal 

government? 

Mr. KEMPTHORNE. I would be surprised if they are not correct on 

a number of the issues that they have raised because they live 


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there. I have a background in local government, state government, 

and federal. The perspective I have been able to pull upon from 

local and state, it is pragmatic. It is on-the-ground. It is—you must 

deal with things hour by hour, and so I really do think they are 

a tremendous resource of ideas, resources that they can bring to 

bear with sheer manpower and a variety of innovations. And you 

want to create that atmosphere so that they feel that they are a 

part of a partnership in solving this problem. 

Mr. LATTA. Well, I thank you for that, and I thank you again for 

both being before us. And I yield back. Thank you. 

Mr. STUPAK. Mr. Green for questions please. 

Mr. GREEN. Mr. Gonzalez. I will pass, Mr. Chairman. 

Mr. STUPAK. Mr. Gonzalez, and it is up to you for seven minutes. 

You have seven minutes since you waived your opening. Seven 

minutes. 

Mr. GONZALEZ. I appreciate it. Thank you, Mr. Chairman, and 

welcome to the witnesses. We really appreciate your presence here 

today. Secretary Norton, you have indicated the analogy that has 

been used on the floor and elsewhere is if you have one plane crash 

you don’t suspend all air service and such, but isn’t it the truth 

that we do have recalls and we take everything off the road or out 

of the air if it is a specific model, for instance, that has maybe a 

structural defect? So if we were able to identify, let us say, 747’s 

had a structural defect, a couple of crashes or just one, the result 

would be we would bring them all in and it would be examined and 

we would remedy the problem so we would have that particular 

scenario play out, would we not? 

Ms. NORTON. And I think that is consistent with the idea of having a safety review and checking and inspecting those aircraft and 

then getting them back into service as quickly as possible. 

Mr. GONZALEZ. But your frame of reference is to existing regulations that basically have failed that didn’t stop this particular occurrence from happening. Now what I am saying is I disagree with 

the Administration on one size fits all moratorium, and I think we 

are going to get some specificity and such, but the question really 

comes down to the following. We had all of the major players that 

are involved in deep water exploration production here. None of 

them said—now they all disagreed with the way BP conducted 

itself and the way they were trying to plug the hole and such, but 

none of them said that if there was a blow out at that depth that 

they could really guarantee that their blow out preventers would 

have in fact worked, point one. Point two was none of them, none 

of them, said that their plan for containment and clean up was any 

different than BP’s. 

So are we really at a point right now where we can make these 

determinations as to the adequacy and sufficiency of what we have 

out there that would be applied to these rigs? Now I am going to 

agree with you that different points of production, exploration and 

such, I think you can have certain rules and continue the activity 

out there, but how do you guard against a similar situation when 

everybody from the industry pretty well agrees and maybe my colleagues would disagree with my representation, but that is the way 

I remember the testimony. No one is saying that the blow out preventer if activated, if property activated, would have remedied the 


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situation, and no one is disagreeing that the containment policy 

and plans are any different from one producer to another. 

So a moratorium seems the proper thing to do. As I said, one size 

fits all, I don’t agree with that. But wouldn’t you agree that is a 

prudent thing for the Administration to have done? 

Ms. NORTON. One concern with a moratorium is—certainly our 

experience with offshore is they tend to stay in effect and once— 

we certainly have seen that with the history of moratoria in our 

country, and things that were put in place for a few years have extended on and on and on for many years. I think given the delicate 

state of our economy right now, I think given the number of jobs 

that are at stake, given the devastation of the economy in the Gulf 

Coast, we really need—— 

Mr. GONZALEZ. Madam Secretary, I understand the economic 

consequences, and with the greatest respect and admiration for my 

colleagues from Louisiana, I am from Texas. I sort of understand 

the economic impact of these things. However, I think even former 

Secretary Kempthorne indicated that you need to move forward, 

have the economic considerations, but not in total denial of the realities of what might be in jeopardy. That is all I am saying, and 

I think the Administration is going to fine tune and tweak it. Now 

this Administration is never going to satisfy some of those that believe there should be some sort of ceremony on changing of command and we don’t have a General Patton, but you are not going 

to see President Obama parachute onto an oil rig with a mission 

accomplished sign. It is not going to happen, and I am grateful that 

that is not going to happen because it is meaningless. 

Now let me ask you, former Secretary Kempthorne. You seem to 

be indicating that this Administration and the Secretary of Interior 

is dismissing out of hand any suggestion or recommendation being 

made by any of the governors or local officials. Is that a fact? 

Mr. KEMPTHORNE. Congressman, no, I don’t believe I used any of 

those particular words, and also would reiterate that I did not 

come today in any way to be a critic of my successor. He is in a 

tough situation. I applauded his nomination. Mr. Salazar and I are 

friends. But I do believe, Congressman, you do have to create an 

atmosphere so that the local officials and the state officials do feel 

that they are part of this, and all I can do because I am not privy, 

I am not privy to the information, the data that Secretary Salazar 

is receiving, but I do see as an observer reports and reactions of 

the media of local and state officials which would suggest we have 

not yet reached that crescendo—— 

Mr. GONZALEZ. But isn’t that a product of the frustration that 

these officials are feeling because of the magnitude of what is happening to their economies, what is happening to their shorelines. 

I mean I understand the frustration, but I think you just said 

something that is very important, and that is none of us is privy 

to what is going on in those rooms when those suggestions and recommendations are being made. Now would you say that any recommendation or suggestion that is being made by either a governor 

or a local official should be adopted? 

Mr. KEMPTHORNE. Not just because they made it but I believe 

again based on my experience that often it is backed up with pragmatism, with actual realities and results, and they should be very, 


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very carefully considered with a view towards seeing what is practical and can we, in fact, implement it because just as you said, 

Congressman, the devastation in the Gulf Coast, they are all feeling it, and they would like to be part of the solution, and I think 

they do have—— 

Mr. GONZALEZ. Is there any reason for you to believe that they 

are not carefully being weighed and analyzed and evaluated because I think that is an assumption that has been made by many, 

which I don’t think is true. 

Mr. KEMPTHORNE. Congressman, I don’t believe I am in a position to judge that. 

Mr. GONZALEZ. Well, I appreciate that. Thank you very much for 

your testimony today. Yield back, Mr. Chairman. 

Mr. STUPAK. Thank you, Mr. Gonzalez. We have a pending motion by Mr. Burgess who wants the May 27, 2010, report, the 30- 

day safety report, and he read from page 8, to be made part of the 

record. The 30-day safety report acknowledges existing regulations 

as it must. It notes that these are the minimum requirements for 

the safe operation, and it recommends two blind share rams. This 

is the point of what we have learned. Minimum requirements may 

not be sufficient. That is why I say when there is no serious enforcement, that is why I am glad this committee reached a bipartisan agreement on the Blowout Prevention Act, which would mandate redundancy that the department failed to put in place way 

back in 2003. So without objection, the May 27 report of the Department of Interior is made part of the record. Ms. Blackburn, 

questions? 

Mrs. BLACKBURN. Thank you, Mr. Chairman. I thought we were 

still on the motion there. I do have a couple of questions. Before 

coming to Energy and Commerce, I was on the Government Oversight and Reform—Government Reform Committee and of course 

on Government Oversight and Investigations here. And I have sat 

through hearing after hearing. Those in front of us will talk about 

how resistant to change the agencies are, and how difficult change 

and reform comes, so I would like to hear from each of you, when 

you look at Secretary Salazar’s desire to institute some changes, 

what do you think the institutional resistance is going to be, how 

much of it is going to be there. I would also like for you to address 

how you think he best dealt with the ethical problems that are DOI 

and at MMS, and how you confront that. 

And then the third thing, and, Secretary Norton, I think that you 

are going to be in the best place to address this, if you could just 

articulate a little bit about how during your tenure you worked in 

the aftermath of Katrina with your state and local officials to get 

the information going forward with them. So those are the 3 things 

that I would love to touch on. And, Madam Secretary, if you will 

go first and then Secretary Kempthorne, if you would answer after 

her. 

Ms. NORTON. Thank you, Congresswoman, for that question. The 

issue of ethical changes is one that I think Secretary Kempthorne 

can go into because he really dealt with that during his time. It 

was in my administration that I think people became aware of 

that, the leadership of MMS either right before or right after I left 

office went to the Inspector General having heard these rumors 


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and initiated the process that led to the changes that Secretary 

Kempthorne brought about. I think we need to look at what is the 

end result we want to achieve because, yes, you certainly want to 

have employees adhering to ethical standards, but if you let the 

idea of having a strong separation between industry and employees 

go too far, you cut off the lines of communication. I think the important issues right now are capabilities, our skills, our expertise, 

our resources that are available for the oversight process, the regulatory process. I tend to think of this as having been 8 years as an 

attorney general as a community policing kind of issue. 

We used to have police that would ride around in their cop cars 

and have their windows rolled up and enforce the laws as someone 

who was imposing and who was us versus them kind of atmosphere 

with the community. And we learned that it was much more effective to have police who were out in the community working with 

people who would get tips about what the problems were, who understood the nuances of that neighborhood and what its problems 

were. And so I think you have to have a happy medium. You have 

to have very high ethical standards but you can’t go so far that you 

only hire people who have no experience and no real understanding 

and expertise about what decisions need to be made. 

Mrs. BLACKBURN. Thank you. And then could you speak to 

Katrina, the aftermath of Katrina, and how you worked with the 

local and state? 

Ms. NORTON. My primary role in Katrina was dealing with the 

offshore energy and so that really was more a state—excuse me, a 

purely federal program. But we certainly did have interaction 

throughout the administration with the state and local officials. 

And I know I was very proud of people in my department who really even as federal agencies lent their efforts to lots of local recovery 

efforts, at emergency response efforts, at just—— 

Mrs. BLACKBURN. Let me interject here again. So you responded 

to the requests you got directly and giving the information needed? 

Ms. NORTON. Yes, we did. 

Mrs. BLACKBURN. OK. 

Ms. NORTON. What we tried to do was empower people to make 

those decisions and to be cooperative and do that right away. 

Mrs. BLACKBURN. Thank you. Yes, sir. 

Mr. KEMPTHORNE. Congresswoman Blackburn, my tenure at the 

Department of Interior, I will tell you was a period in my life that 

I was very proud to serve with those people, dedicated public servants. It is a large organization, 73,000 people, but I will tell you 

that I was impressed, day in and day out, with their attitude. Yes, 

at times they were down in the mouth about certain things. 

I remember, too, at my confirmation hearing there were a number of issues that were brought forward, some of which that had 

been there for years, and I made it a to-do list to try and go down 

and resolve some of these issues. On one occasion I brought in a 

group of the employees, including those from the region that was 

affected. I said you need to tell me about this issue, because I don’t 

understand it yet. They began by saying, well, we have been working on it for 15 years, and I said, all right, I have to stop you because I don’t have 15 years. We may not reach perfection but we 

will reach a decision, so let us discuss it. We did, thorough discusVerDate Mar 14 2013 04:56 Mar 20, 2013 Jkt 077922 PO 00000 Frm 00114 Fmt 6633 Sfmt 6633 E:\HR\OC\A922.XXX A922

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sion. That afternoon, I said here is my recommendation. Can you 

all live by this? We got through it, and the attitude was hallelujah, 

we have a decision and will go forward. 

You referenced about the ethics that is there. I will tell you that 

I worked closely with Inspector General Bill Devaney on a continual basis, and that is why I wanted his testimony as part of this 

record. I believe that the seeds for what is bringing about the positive opportunities in MMS were planted by the actions while still 

in office that we took concerning the royalty in kind program, the 

calling of Senator Kerrey and Senator Garn and asking them personally if they would head up a talented group of people to do so. 

That has been pointed to by the current Administration that it is 

good substance. They are adhering to that. Seventy some suggestions were implemented before we left. 

You asked about change. All of us, all of us, have an inclination 

perhaps to be resistant to change, but I have to say that in the 

proper atmosphere I was impressed on different occasions how nimble that the Department of Interior could be if given a direction 

and a purpose. The concern I would raise is simply that in this atmosphere where there have been sharp comments made regarding 

MMS, I think it can have a demoralizing effect on very good people. 

And as Inspector General Devaney said, 99.9 percent of people at 

DOI are good, hard-working, ethical people. I am afraid that with 

the sharp criticism even coming from their own leaders it doesn’t 

create a team atmosphere and so their concern— and they may not 

be making decisions that they should be making as part of the responsibility because they are worried about the repercussions. So 

I think that there needs to be concern given toward the atmosphere 

of leading a department in the right direction on behalf of the people of the country. 

Mrs. BLACKBURN. Thank you. Yield back. 

Mr. STUPAK. Mr. Markey for questions, please. 

Mr. MARKEY. Thank you. Mr. Chairman. Secretary Norton, in 

your responses to Chairman Waxman, you denied that changes in 

OCS drilling policy were undertaken as part of the Interior Department’s efforts to implement the Cheney Energy Task Force plan. 

In 2001, in reality the Department of Interior under your all leadership stopped even considering the possibility of a worst case oil 

spill when it was evaluating the potential environmental impacts 

of deep water oil and gas production activities. Secretary Norton, 

do you agree that it was wrong for you to ignore the potential for 

a worst case oil spill for deep water oil and gas production activities? 

Ms. NORTON. Congressman, I am sorry, I do not know the documents to which you are referring. I don’t know exactly what it is 

that you are referring to in that decision. I apologize. I don’t recall. 

Mr. MARKEY. Well, it is true that you—and I have the document 

right here in my hand and I will give it to you so that you can review it later, but I will just summarize it for you that you stopped 

considering the possibility of a worst case scenario spill in 2001. 

Your 2001 strategy for post-release ANEBA compliance in deep 

water areas of the Gulf of Mexico did, in fact, change the manner 

in which the Interior Department evaluated worst case impacts. 

Let me read to you what the Interior Department staff informed 


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our staff about these changes in 2001. These analyses ‘‘do not include oil spills as part of the review.’’ In other words, environmental assessments no longer had to include the worst case spill 

scenarios that had been used previously by the Clinton Administration. 

Madam Secretary, you chose to replace a real world worst case 

analysis with a paper exercise that was not at all realistic. As the 

Interior staff had some qualms, my staff, ‘‘The belief at the time 

was that blowouts were such a low probability event that the time 

and effort being expended on analyzing them for site-specific environmental assessment was not worth the effort.’’ Do you agree, 

Madam Secretary, that that decision was a mistake? 

Ms. NORTON. I think going forward you are going to have to 

grapple with the aftermath—— 

Mr. MARKEY. Do you agree that the decision that you made at 

that time was a mistake? 

Ms. NORTON. You can’t stop all drilling in the future—— 

Mr. MARKEY. I am not asking for any stopping—no one here 

wants to stop all drilling in the future. No one, so stop putting the 

red herrings out here. Did you make a mistake in 2001? 

Ms. NORTON. I don’t know the document you are referring to. I 

haven’t had the chance to look at it. It seems to me that you have 

to have a reasonable analysis and that is both today—— 

Mr. MARKEY. Was it reasonable to not do a worst case scenario 

analysis for a spill? Yes or no. 

Ms. NORTON. It was reasonable to take into account what the 

history had been. The history was—— 

Mr. MARKEY. So you don’t any longer—— 

Ms. NORTON. There were very few large spills. 

Mr. MARKEY. OK. Let me go on to the second question. 

Ms. NORTON. I think we now have seen a very different change. 

Mr. MARKEY. In 2003, Madam Secretary, the Department of Interior also under your leadership actually exempted most Gulf of 

Mexico lessees from including blowout scenarios in their oil and gas 

exploration or production plans. They were also exempted from a 

requirement to provide information about how long it would take 

to drill a relief well and how a blowout could be contained by capping the well or by other means. This policy was reiterated in both 

2006 and 2008. As a result, BP didn’t include any of these blowout 

scenarios or relief well plans in its plans for the Macondo. In retrospect, do you think, Madam Secretary, that this exemption was a 

good idea? 

Ms. NORTON. My understanding is that under the Outer Continental Shelf Lands Act there is a process of looking at things on 

a broad scale that really ought to focus on—— 

Mr. MARKEY. Do you think it was a mistake to create those exemptions in retrospect? 

Ms. NORTON. But it is appropriate to deal with those kinds of 

issues in an offshore situation by looking at those in the big scale 

basis and then for the individual wells, individual plans of exploration, you focus on those things that apply to that—— 

Mr. MARKEY. Madam Secretary, again—— 

Ms. NORTON. And so you have things on a broad scale basis—— 


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Mr. MARKEY. Madam Secretary, there was a D regulatory ticking 

time bomb that was set while you were Secretary that has now exploded in terms of this blowout preventer and other devices not 

having been properly regulated. Do you believe in retrospect if was 

a mistake to create those exemptions? 

Ms. NORTON. I haven’t seen anything that would indicate that 

there is a cause and effect relationship between the Deepwater Horizon decisions that were made by BP and what this analysis is 

that you are talking about. 

Mr. MARKEY. A climate, Madam Secretary, of complacency was 

created by boosterism, which has now led to a catastrophe and that 

boosterism, that complacency, was this deregulatory environment 

which was created during that 8-year period. It affected blowout 

preventers. It affected the spill response plans that needed to be 

put in place. It, in fact, dealt with all aspects of what it is that we 

are now dealing with as a consequence of those decisions. Mr. 

Chairman, thank you. 

Mr. STUPAK. Mr. Scalise for questions, please, 5 minutes. 

Mr. SCALISE. Thank you. Mr. Chairman. Starting with the moratorium that has been discussed a lot. I want to go back to the 30- 

day safety report. And the President and Secretary Salazar had put 

together a commission and they brought in experts, scientists, engineers that were recommended that came together and did a 30-day 

report. And in it they actually recommended some safety changes 

that should be made which I think were very reasonable recommendations but afterwards when the moratorium, the 6-month 

moratorium, was issued it was alluded that the 30-day commission 

supported the moratorium. They had to come out the next day and 

correct that and make it clear that they actually were against the 

moratorium, and they gave some really good safety reasons. 

And I want to ask your opinion on this because it hasn’t really 

been discussed a lot nationally when you talk about this moratorium that is going on that potentially has a greater devastating impact on our state long term than the spill itself because of the negative impact on jobs, and some people are trying to make this a 

choice between jobs and safety. But, in fact, the scientists that the 

President himself recommended, not our scientists, it is the President’s scientists, they said you would reduce safety in four different 

areas if you have a moratorium because, number one, your most 

experienced rigs would leave first, the rigs that are the newest and 

the most technologically superior, your most experienced crew 

members. They cannot put some kind of mysterious 6-month pause 

on their life. They are not going to just sit idle and collect unemployment as the President suggested to them. They are going to 

have to go do something else to earn a living for their families so 

you lose those most experienced crew members. 

There are high risks involved with stopping and starting operations, and then the final point is our country’s dependence on oil 

hasn’t decreased, so as you take maybe 20 percent of the oil supply 

that the nation consumes away that is going to have to come from 

somewhere else and that is going to be imported by Middle Eastern 

countries, many of whom don’t like us, but it is going to be imported by tankers, and 70 percent of all the spills come from tankers, so you actually increase the likelihood of spills and you reduce 


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safety by getting rid of that experienced work force and those vital 

and scarce resources in those rigs. 

So with all of that said, I haven’t seen a lot of discussion on the 

other side about the decrease in safety associated with this moratorium that the federal judge said should go forward. I want to get 

your take on that. Ms. Norton. 

Ms. NORTON. I think there is some legitimate concern about losing the most sophisticated of the rigs to other countries and to 

making sure that we are not losing all the personnel that are most 

experienced to other places, all of those good jobs. I also think you 

have raised a very good point with the tanker safety because you 

are absolutely right that in our past experience before we got to the 

Deepwater Horizon experience, it had been tankers that were the 

largest source of oil from the industry overall as opposed to from 

the platforms. 

Mr. SCALISE. Mr. Kempthorne. 

Mr. KEMPTHORNE. Yes. Congressman, you raise very valid points, 

many of which I happen to agree with. And I think included in 

yours is the fact that this it not mutually exclusive. We can have 

a safety record and in 40 years we did. There is a question as to 

what caused this current tragedy of 90 days ago. Was it the regulations that for 40 years or a number of years were on the books and 

we did not see this catastrophe or was it decisions made, human 

decisions made, in the implementation after the application for the 

drilling permit was granted. I cannot comment with regard to the 

safety group and how a letter may have surfaced where they felt 

that they were being misrepresented. I cannot do that, and I 

think—— 

Mr. SCALISE. And that has been entered into the record. 

Mr. KEMPTHORNE. Yes, and that will be something that your 

next guest will have the opportunity to address, I would imagine. 

But again it was appropriate to go and look at the safety. Had you 

found that there were a number of problems that surfaced immediately then you would have consideration of what else to do but 

you did not. I think there was only one concern that was identified. 

Mr. SCALISE. And I think if you go back and you look a lot of the 

rigs that are operating in deeper waters because this disaster occurred at 35,000 feet. There are people out there in 8,000, 9,000, 

10,000 feet that follow a different set of safety standards and don’t 

have these kind of problems because they play by the rules and, 

in fact, we saw, unfortunately, this was an avoidable tragedy because of the things that weren’t followed. But hopefully we can get 

into more of that later. But I also want to touch on another point 

and that is this chain of command issue. Clearly, when I talk to 

leaders on the ground their biggest frustration is that they are 

spending more time battling the federal government than the oil 

because you don’t have that all hands on deck urgency approach 

taken by the federal government that needs to start now. Unfortunately, we are 3 months in and we still don’t have it. But, finally, 

Mr. Kempthorne, what were federal revenues for offshore drilling 

that would come into the federal treasury in your last year as secretary? 

Mr. KEMPTHORNE. Approximately $23 billion. 

Mr. SCALISE. Clearly, that would be in jeopardy in a moratorium. 


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Mr. STUPAK. The gentleman’s time. 

Mr. SCALISE. Thank you. I yield back. 

Mr. STUPAK. You answered the last one, Mr. Secretary, 23 billion, you said? 

Mr. KEMPTHORNE. Yes, sir. 

Mr. STUPAK. Mr. Braley for questions. 

Mr. BRALEY. Thank you, Mr. Chairman. I would like to begin by 

offering the Congressional Research Service report for Congress titled the 2010 Oil Spill Minerals Management Service and National 

Environmental Policy Act dated June 1, 2010. 

Mr. STUPAK. Yes, we will take a look at it. We will hold it in 

abeyance for now. Go ahead. 

Mr. BRALEY. One of the things that this report identifies is that 

there are four different stages of the review process that are supposed to take place on every oil lease in the Outer Continental 

Shelf. The first is the development of a 5-year program, then a plan 

for a specific lease sale, then approval of the exploration plan, and 

then approval of a development and production plan. Would both 

of you agree with that? 

Ms. NORTON. Yes. 

Mr. BRALEY. And these four stages are based on the Outer Continental Shelf Liability Act. That is your understanding of the statutory basis for those requirements? 

Ms. NORTON. The Outer Continental Shelf lands, yes. 

Mr. BRALEY. Yes. You have to say yes so that it is part of the— 

yes. And one of the things that the courts interpreting that act 

have concluded is that one of the basic premises of this review 

process is a tiered environmental review assuming that the level of 

scrutiny increases as a lease moves toward approval of the development and production plan. Would you both agree with that? 

Ms. NORTON. Yes. 

Mr. KEMPTHORNE. Yes. 

Mr. BRALEY. One of the things that disturbs me about this report 

and about the circumstances that led up to this disaster is that the 

requirements for blowout scenario differ depending upon which 

part of the Gulf is affected. Are you both aware of that? 

Ms. NORTON. Yes and no because the flow of currents might be 

different. The terrain that is on the shoreline might be different. 

But in many ways the impacts are going to be the same. Whether 

the Deepwater Horizon was 10 miles one way or the other would 

not have the same impact as it would on shore—— 

Mr. BRALEY. Madam Secretary, I am not talking about those 

issues. I am talking about the regulatory framework itself that requires blowout prevention scenarios to be part of this review process. Can you explain to me, for example, when the State of Florida 

is the affected state, which is the eastern Gulf, there is a mandatory requirement for a blowout scenario, and yet when the State of 

Texas is the affected state, the western Gulf region or the central 

Gulf region which is the part most devastated by this disaster 

there is not a mandatory requirement for a blowout scenario under 

the regulation? 

Ms. NORTON. That is something that I have not been able to 

trace exactly what the rationale was behind that. I don’t have access to the people within the Minerals Management Service to ask 


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exactly what the thinking was on that. I think it could either have 

been because those things in areas to which you refer, those are 

already handled in other documents and through other analyses 

that are done routinely. 

Mr. BRALEY. My review of the regulation makes it clear that 

there are specific preferences given to individual states, and can 

you think of any legitimate reason why the residents of the central 

Gulf would have less interest in extensive environmental review 

than residents of the State of Florida? 

Ms. NORTON. There is something called the Coastal Zone Management Act that has a significant impact on offshore development, 

and it does require the federal government to take into account the 

plans of the various states as decisions are being made offshore. 

Mr. BRALEY. Do you agree that the impact of devastation is the 

same regardless of where that blowout would occur? 

Ms. NORTON. It certainly has shown to be a different devastation 

here and a terrific impact. 

Mr. BRALEY. Now, Mr. Kempthorne, part of the other information 

included on page 13 of this report is an indication that while MMS 

regulations require disclosure of a blowout scenario and exploration 

plans, MMS provided an exception in a 2008 notice to lessees on 

this particular lease, which would have been during your tenure, 

is that correct? 

Mr. KEMPTHORNE. That would be during my tenure. 

Mr. BRALEY. And the exception exempted OCS actions in the 

Gulf from blowout scenario requirements under certain conditions, 

and those are the exact conditions I am referring to which did not 

require a mandatory blowout scenario for the central Gulf. Were 

you aware of that? 

Mr. KEMPTHORNE. Congressman, there is a longstanding provision that allows a regional director to limit information that needs 

to be submitted. 

Ms. NORTON. I think why we are both struggling—— 

Mr. BRALEY. Excuse me. I only have 2 minutes left. Here is the 

problem I am having. BP submitted information to Minerals Management Service at the earlier stages of this lease indicating there 

was a 99 percent chance of a blowout over the 40-year period of the 

lease, a 99 percent probability, and that the most likely scenario 

would be a 10,000 barrel release as part of that blowout, and BP 

had also discussed a worst case scenario response in its initial exploration plan and it considered a worst case scenario to be a blowout at the exploratory stage leading to a spill of 3857 barrels of 

crude per day. 

And even with that information, MMS approved BP’s spill response plan for worst case scenario, and despite all that information that was in the leasing record BP sought and received a categorical exclusion from an environmental impact duty at the later 

phases of this process. And given what you admitted to me earlier 

about the intention being a more strict scrutiny of the environmental impact as a lease progresses toward production can either 

of you explain to me why that happened? 

Ms. NORTON. I don’t know the specific details you are citing but 

the categorical exclusion for those kinds of things has been part of 

the Outer Continental Shelf Lands Management since the 1980s, 


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and so it is the way in which those things have been handled 

throughout basically the existence of the program. 

Mr. BRALEY. This report raised the disturbing scenario that the 

approval process of the categorical exclusion eliminating the need 

for an environmental impact statement later on in the development 

of this lease turned the expected level of scrutiny on its head so 

that instead of having a stricter scrutiny of that environmental impact at the later stages moving towards development and production a waiver was granted rather than requiring a more intense 

level of review, and that makes no sense. 

Ms. NORTON. Well, you need to look more into the details of the 

specific proposal as you move closer to that specific proposal. The 

concept of the Outer Continental Shelf Lands Act is that you look 

at those large scale issues on a large scale basis. 

Mr. BRALEY. And I understand that, and my time is running out, 

so let me just close with this. Do you not agree that in light of what 

we know now that policy of giving categorical exclusions which 

seems to be the opposite of the intended stricter scrutiny as you get 

closer to production should be re-evaluated by MMS? 

Ms. NORTON. I certainly do think you need to look at these 

things going forward and look at your overall process, so I do think 

you need to look at how those things need to relate in the future 

and especially as you are talking about how something that is a 

very catastrophic event but has a very small probability of actually 

happening. 

Mr. BRALEY. Well, this had a 99 percent probability of happening 

in a 40-year lease. 

Ms. NORTON. I frankly question that. I think that may not have 

been a correct reading. 

Mr. BRALEY. Well, I am reading from the report, and I yield 

back. 

Mr. STUPAK. And, Mr. Braley, would you provide a copy of that 

report so the minority can look at it? 

Mr. BRALEY. Absolutely. 

Mr. STUPAK. So your motion is still pending on whether or not 

it will be accepted. Secretaries, can you go 20, 25 more minutes? 

Mr. KEMPTHORNE. You are anxious for your next guest to join 

you. 

Mr. STUPAK. We are anxious to have him too. A few more questions, if you may. Let us start myself, Mr. Burgess, and whoever 

else will go and attempt to cut if off. OK. How is that? Fair 

enough? Let me ask this. It seems like we have the energy task 

force in 2001 saying let us get our energy going, and we have a 

couple executive orders to expand offshore drilling, get things rolling. It seems like throughout all of our hearings we developed a 

technology to drill deeper and in more sensitive areas, and hopefully we do it in a safe manner, but we never developed the technology to have a clean up. Is that fair to say? We are using the 

same technologies from the 1920’s, booms and trying to skim it and 

burn it off. Fair to say? 

So let me ask this question. In the government models, we always talk about worst case scenarios, government models, the last 

time they were updated was 2004, and they dealt with surface 

spills, nothing deep water. In 2005, MMS modeling team recVerDate Mar 14 2013 04:56 Mar 20, 2013 Jkt 077922 PO 00000 Frm 00121 Fmt 6633 Sfmt 6633 E:\HR\OC\A922.XXX A922

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ommended that the spill plans need to be upgraded to deal with 

deep water releases. Any reason why that was not done? Madam 

Secretary, it was 2005, you were still there. Do you remember their 

report recommending doing some deep water modeling because 

that is what we based everything upon. 

Ms. NORTON. Congressman, I do not recollect that report. 

Mr. STUPAK. I will ask Secretary Salazar the same thing. Mr. 

Kempthorne, any idea that we had that request there that was 

never done? 

Mr. KEMPTHORNE. No, Mr. Chairman, I do not. 

Mr. STUPAK. OK. Let me ask this. You both mentioned the history of no spills and internationally, I think, Secretary Norton, you 

mentioned we were looked at favorably. I am looking at a report 

here, SINTEF. It is dated July 24, 2001, and SINTEF is actually 

out of Norway, and they were asked to do a report from Minerals 

Management Service. And in there they are talking about the 

study of the BOPs, blowout preventers, and what goes wrong and 

kicks in the wells. And I thought it was very interesting of the 83 

wells drilled in deep waters ranging from 1,300 feet to 6,500 feet 

there were a total of on these 83 wells 117 BOP failures and 48 

well kicks. This is off 26 different rigs. So if you take a look at that, 

we have 117 BOP failures, 48 well kicks. That would be two incidents per well or 6 incidents per rig, and this report goes on and 

says an alternative BOP configuration and a BOP test procedure 

that will improve safety availability and save costly rig time has 

been proposed. Do you know whatever happened to this report, 

Madam Secretary? 

Ms. NORTON. I don’t recall ever seeing it. 

Mr. STUPAK. OK. And when you did the 2003 rulemaking, you 

didn’t take this into consideration then because you don’t remember seeing it? 

Ms. NORTON. I would imagine that someone in the Minerals 

Management Service who had responsibility and who had the technical expertise to evaluate that did so but I as secretary did not 

see that. 

Mr. STUPAK. It was interesting that we hired a Norwegian— 

MMS hired a Norwegian company to do it and they relied—you 

know, Gulf of Mexico versus Norway because they are up in the 

North Sea and they found that we had more kick backs, we had 

more problems with pressure, which actually were the issues that 

led to the problems with Deepwater Horizon. I will conclude my 

questions right there. I will turn to Mr. Burgess for 5 minutes for 

questions. 

Mr. BURGESS. Mr. Chairman, if Secretary Salazar is here, I am 

perfectly prepared for him to come and ask to begin the second 

panel. 

Mr. STUPAK. Are you waiving? 

Mr. BURGESS. If the Secretary is here. Are you ready to start the 

second panel? 

Mr. STUPAK. No. We will be starting at 2:00. 

Mr. BURGESS. At 2:00. Is the Secretary here? 

Mr. STUPAK. No. 

Mr. BURGESS. OK. Has he been—— 

Mr. STUPAK. So have you waived? 


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Mr. BURGESS. No, I am not going to waive. Has he been watching 

this on C–SPAN as you said he might be? 

Mr. STUPAK. That is a good question. You should ask him. 

Mr. BURGESS. I mean I am offended that we have been here all 

day. People have been asking good questions and making reasonable statements and—— 

Mr. STUPAK. Mr. Burgess, you know darn well that the Secretary 

has his staff here and he may very well be watching it but I 

haven’t had—— 

Mr. BURGESS. The Secretary has so little interest that he 

wouldn’t even notice that we were winding down and that the committee had dwindled to a less than critical mass. Let us do—— 

Mr. STUPAK. Well, if you have no further questions. 

Mr. BURGESS. I do have some questions. 

Mr. STUPAK. OK. 

Mr. BURGESS. Let us visit for just a minute some of the questions 

that Mr. Markey was asking and not really allowing for a response. 

Secretary Norton, when you became secretary and you inherited 

the agency from Secretary Babbitt, were there specific regulations 

relating to deep water drilling that had been proposed by the previous administration? 

Ms. NORTON. Yes, there were some regulations as to blowout preventers and cementing and so forth that had been proposed in 

2000. 

Mr. BURGESS. And what was the result of that? Did you proceed 

with the implementation of those regulations or did you shut them 

off because it was a new administration? 

Ms. NORTON. They were proposed in the previous administration 

in 2000. They were finalized in my administration. There were very 

few changes that took place between the proposed and the final. 

The one key thing that we added in to that was a requirement that 

the companies look at the deep water technology and how they 

were using stronger pipes and needed to have stronger shear rams 

in order to deal with those kinds of more hardened pipes. And so 

we put in place a new requirement that had not been in the previous proposal that required industry to do that. We put in place 

several requirements in those regulations over the objection of industry. 

Mr. BURGESS. So if that is a deregulatory ticking time bomb that 

was set in motion that really doesn’t compute then, does it? 

Ms. NORTON. No. 

Mr. BURGESS. Was the deregulatory ticking time bomb then 

started during the Clinton Administration or is in fact the deregulatory ticking time bomb simply a straw dog or a red herring as 

the chairman put it to you? He said it is just a red herring that 

he is throwing out. There is no question. I got a list here. I referenced earlier some 23 or 25 studies that were done by the Technology and Assessment Research Program. Someone has been kind 

enough to provide me what must be 100 or 150 such studies—600. 

I beg your pardon, 600 studies that have been done. Not every one 

of these studies will lead to a new regulation but the studies are 

done for good reason to address problems that are out there, but 

then they become part of the investigatory process that leads to the 

rulemaking that eventually then governs the rules. It would be 


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very difficult to run any industry—my background is in medicine 

but if somebody came and sat down 600 new regulations, oh, wait, 

we may do that. 

But, nevertheless, it becomes very, very difficult to run anything 

with having this level of regulation but at the same time your 

agency, both of you, was charged with looking at these things putting what you thought was out for reasonable proposed rulemaking 

and then setting the regulations and setting the rules, is that not 

correct? 

Ms. NORTON. Yes, and there is also behind that a whole set of 

industry standards, some of which were adopted by MMS and some 

of which remained industry best practices. And that also took into 

account—those things were changed much more frequently than 

the regulations to take into account advances in learning from all 

these various studies. 

Mr. BURGESS. You know, we had one hearing here where we had 

5 or 6 executives from the big oil exploration companies, and one 

of the things that really struck me that morning, of course, 5 to 1 

said they wouldn’t have done what BP did as far as the drilling 

practices. But from the individuals who were here that actually 

worked had worked their way up in their companies and started 

on the offshore rigs, a lot of sensitivity to the fact that you sometimes would have to shut down a well. You sometimes would not 

be able to bring a well in because it was simply too dangerous. And 

one of the executives even made the comment in response to one 

of the Democrat’s questions that if you start going too fast you are 

going to get someone killed. 

It is important to have people who worked in the industry as 

part of the process so the fact that it could be done in some sort 

of vacuum without taking into account the people who actually 

know how to run the business on the face of it is preposterous. Mr. 

Chairman, you have been kind. I will yield back the balance of my 

time, and we have others who want to fill the void that Secretary 

Salazar has left. 

Mr. STUPAK. It should be noted that you are over your time, but 

that is all right. Mr. Markey, questions, please. 

Mr. MARKEY. Thank you, Mr. Chairman, very much. Secretary 

Kempthorne, you heard me question Secretary Norton earlier on 

the 2003 decision by the Interior Department to exempt Gulf of 

Mexico lessees from actually including a blowout scenario in their 

oil and gas exploration plans, but this policy was also continued in 

both 2006 and 2008 when decisions about the BP Macondo well 

were being made on your watch. In retrospect, Mr. Secretary, 

wasn’t your decision wrong? Shouldn’t there have been, in fact, 

planning for a blowout scenario? 

Mr. KEMPTHORNE. Congressman Markey, I have a great deal of 

faith in the professionals there at MMS that deal with this, the different levels, the regional directors, et cetera. And, again, based 

upon what had been a 40-year record—— 

Mr. MARKEY. In retrospect, do you believe that decision was 

wrong informed by what has happened? 

Mr. KEMPTHORNE. Again, based on what had been a 40-year history, I believe they took the appropriate action—— 

Mr. MARKEY. Was the advice they gave you wrong? 


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Mr. KEMPTHORNE. They gave me the best advice—— 

Mr. MARKEY. Was the advice wrong? 

Mr. KEMPTHORNE. I will just repeat my answer. 

Mr. MARKEY. You are not willing to say the advice you got was 

wrong? 

Mr. KEMPTHORNE. Again, based on the 40 years—— 

Mr. MARKEY. And I am asking you in retrospect now was the advice wrong? 

Mr. KEMPTHORNE. The advice that I was given based on a 40- 

year—— 

Mr. MARKEY. The advice you were given with regard to whether 

or not there should in fact be a closer inspection of a potential for 

a blowout scenario, was it right or wrong, the advice you got? 

Mr. KEMPTHORNE. At the time with the knowledge that they 

had—— 

Mr. MARKEY. No, today. Today was it—as you look back, are you 

willing to say the advice you received was wrong and the policy 

should have been changed back in 2006 or 2008? 

Mr. KEMPTHORNE. Mr. Markey, I don’t think we have that hindsight. 

Mr. MARKEY. You have the hindsight. We are looking for wisdom. 

We are trying to pass legislation. Should that decision have been 

made given what you know today? 

Mr. KEMPTHORNE. I think it is something that can be evaluated. 

Mr. MARKEY. I think that honestly that is a completely unacceptable answer. The American people want to know that the people 

who are making the decisions at the time understand that it was 

wrong, that a blowout could occur, that a spill could occur that 

would be catastrophic, and until you are willing to say it was a 

mistake then I think it is going to be very hard for the American 

people to accept that we are going to be able to move forward without the likelihood that we will ever see this kind of an accident 

again if there is a Republican administration that comes back into 

office again. 

Mr. KEMPTHORNE. Well, Mr. Chairman and Mr. Chairman, I 

think in the atmosphere that this committee was called, the fact 

that we came here voluntarily, that this assignment of blame is not 

something that—— 

Mr. MARKEY. I am not asking you to blame—I am asking you if 

in retrospect you still believe that it was the right decision or the 

wrong decision. I am absolutely not asking for you to say anything 

other than that. Was the decision wrong? 

Mr. KEMPTHORNE. And, Congressman, all I will say is based 

upon a record and based upon the expertise of the professionals at 

the time that is the reality. 

Mr. MARKEY. I know it is the reality but it would be helpful if 

you could say we were wrong, we made a mistake. And I understand you don’t want to do that, but it is obvious that that was the 

case. Secretary Kempthorne, the environmental impact statement 

for drilling in the Gulf of Mexico that was prepared by the Interior 

Department in April of 2007 under your leadership concluded that 

since blowouts are rare events and are of short duration the potential impacts to marine water quality are not expected to be significant, and the most likely size of a spill would be a total of 4,600 


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barrels total. In retrospect, don’t you think that the department’s 

analysis of the impacts of a blowout were inadequate? Wouldn’t you 

agree that that conclusion was wrong? 

Mr. KEMPTHORNE. Congressman, I would reference back what I 

said in my opening comments, and that is that even though we had 

a 40-year track record that because of the catastrophe that happened 90 days ago it has re-evaluated everything. I will also note 

that in the current Administration’s preliminary revised program 

for OCS 2007–2012, it also uses those same assumptions. 

Mr. MARKEY. Secretary Norton, back in 2004 in terms of spill response your assumption was in the model you used that there 

would only be 1,000 barrels of oil that would be spilled. It assumes 

that the spill will happen on the surface of the ocean and doesn’t 

include any deep water analysis and it doesn’t include the use of 

dispersants and doesn’t even contemplate a blowout that takes 

days, let alone months, to stop. Do you agree now that such a plan 

was completely inadequate? 

Ms. NORTON. That statement was based on information available 

at the time. We don’t have access to go back to the people who 

made those recommendations, did that modeling, did all of that—— 

Mr. MARKEY. In retrospect, were the recommendations wrong? 

Ms. NORTON. I have no idea of the context in which that was 

made. I have no idea what it applied to. I have no idea what was 

the decision that you are talking about so I can’t say whether—I 

don’t have any information which—— 

Mr. STUPAK. Point of order. Time has expired. Mr. Gingrey for 

questions, please. 

Mr. GINGREY. Mr. Chairman, thank you. Secretary Norton and 

Secretary Kempthorne, I didn’t do this in my opening statement 

but I would certainly like to take a brief moment to thank both of 

you. You are here today at the request of the subcommittee to discuss your time at the helm of the Department of Interior during 

the Bush Administration. You are here as private citizens and you 

are doing it voluntarily, and I am deeply appreciate of that, and 

I think most members of the committee feel the same way. Both 

of you had interest and experience with MMS during your tenure. 

Secretary Norton, you witnessed firsthand the devastation that was 

caused by Katrina and Rita in 2005 and you had the opportunity 

to see up close and personal how MMS was able to respond to what 

could have been an ecological disaster. And, Secretary Kempthorne, 

in your testimony I think you mentioned the issues that arose with 

some individuals who were summarily dismissed from their position at MMS due to unethical conduct, I think was what you said. 

Therefore, both of you had very unique experiences with MMS 

and that leads me to finally have a question. Based on the structures that you had in place at MMS during your tenure, I would 

like to ask both of you to respond to this, if you will, had this accident occurred on your watch, this Deepwater Horizon tragedy, 

would you have used that as a means to reorganized MMS like it 

was done here recently? 

Ms. NORTON. The new structure doesn’t differ that much from 

the previous structures because previously the revenue aspects of 

it and the regulatory aspects have always been in separate divisions of MMS. And, no, I don’t think I would have used it as an 


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opportunity or as an occasion for reorganization. That is something 

that is within the purview of an existing secretary. 

Mr. GINGREY. Certainly. And, Secretary Kempthorne. 

Mr. KEMPTHORNE. Congressman, first of all, I want to thank you 

for your comments concerning our being here today. It is the purview of the incumbent secretary to organize as deemed appropriate. 

I think you are raising the question of timing and in that catastrophe when those are your human resources, when you need everybody pulling together, I think you want to have as much of an 

atmosphere that you will work together cohesively instead of having concerns about who may be singled out next, and so it is a 

question of timing and the creation of a proper atmosphere. 

Mr. GINGREY. And I appreciate both former secretaries, Mr. 

Chairman, in their response and I certainly feel the same way. I 

mean, you know, you go through all this dancing around changing 

the—rearranging as the old expression goes the deck chairs on the 

Titanic, and you come up with a new name which sounds like—reminds me of vegetarian vegetables soup that I remembered as a 

kid and you got a whole new name but have you really done anything. And, more importantly than that though is the distraction 

of trying to do that when the focus really needs to be on the clean 

up and the response and it just doesn’t—I think there is a lot of 

posturing in my humble opinion, and I think really your response 

sort of reinforces my suspicion in regard to that. 

I got a little bit more time left so as a follow-up for both of you, 

can you please comment on the nature of how long—on the nature 

of how a long-term moratorium on offshore energy exploration 

would negatively impact the economy of the Gulf Coast and based 

on your experience how it would make us more dependent on foreign sources of energy. I realize that may have already been asked 

but I wasn’t here and I would love to hear your response to that. 

First you, Secretary Norton, and then Secretary Kempthorne. 

Ms. NORTON. One thing I don’t think we have said before is that 

when companies make decisions for offshore oil wells, a platform 

is a multi-billon dollar decision. You need to have some long-term 

predictability. There are years of planning that go into that kind 

of thing. And so to have all the drilling rigs be off in other countries because of the moratorium is going to have repercussions far 

beyond the 6 months. It is not that you reach the end of 6 months 

and then everything goes right back into gear. There are many, 

many, many years of delay of impact of moving jobs away that are 

potentially involved. 

Mr. STUPAK. Yes. Secretary Kempthorne has a right to respond 

to that question. 

Mr. KEMPTHORNE. Mr. Chairman, thank you very much. Congressman Gingrey, I would preface it by saying I felt it was an extremely appropriate step to do a safety review. They did so. And 

with regard to—as I recall, it is approximately some 30 drill rigs 

in the deep water. Of those that were reviewed it was found that 

perhaps it was only one situation where there was a noncompliance 

of some element but the vast majority of all of the specifics of adherence to the regulations were in place. It was good to pause. It 

was good to take a look at that. But we also need to consider the 

big picture which is the energy security of the country. I believe we 


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are too reliant upon foreign source of energy. I also believe that 

this devastation, which has been horrible by every imagination including the 11 families that grieve and what it has done to the environment there, but a moratorium will compound the devastation 

by the economic devastation that will continue by the loss of jobs. 

And the Gulf Coast region needs an opportunity to recover and not 

have further devastation. 

Mr. GINGREY. Thank you. And, Mr. Chairman, thank you for 

your indulgence. 

Mr. STUPAK. Before we go to Mr. Scalise, Mr. Braley, we have a 

matter pending with Mr. Braley. He asked for the 2010 Oil Spill 

Minerals Management Service and the National Environment Policy Act June 4 CRS report be entered in the record. Without objection, that will be done. Also, myself, Mr. Waxman and Chairman 

Markey, we all referred to different studies, the shear ram capability study September, 2004, by West Engineering, another report 

by West Engineering, evaluation of secondary invention methods 

and well control, again March, 2003, a mini shear study again by 

West Engineering, December, 2002, and the SINTEF report of July 

24, 2001. Without objection, those will all be made part of the 

record. 

Mr. BURGESS. Mr. Chairman. 

Mr. STUPAK. Yes, Mr. Burgess. 

Mr. BURGESS. Also, I would ask that Governor Jindal’s op ed 

from the Washington Post from last Saturday be made part of the 

record. 

Mr. STUPAK. Without objection, it will be made part of the record. 

[The information appears at the conclusion of the hearing.] 

Mr. STUPAK. Mr. Scalise, I think we have about 3 minutes left 

if you want to ask questions for 3 minutes. 

Mr. SCALISE. Thank you, Mr. Chairman. I will ask both of you, 

did either of you issue the permit for the Macondo well, for BP to 

drill the Macondo well? Ms. Norton. 

Ms. NORTON. Definitely not. 

Mr. KEMPTHORNE. No, sir, we did not. 

Mr. SCALISE. I am just saying that to point something out. I 

mean there are a lot of people in this Administration that seem to 

want to run around and blame other people for things. They issued 

it. There is no doubt in the time line. It is even submitted in the 

committee report. It was issued on May 22, 2009, and neither of 

you were there. I think what is really amazing to me is that it 

seems like every time there is a problem this Administration wants 

to try to find somebody else to blame instead of trying to just roll 

up their sleeves and do their job and help solve the problem. And 

I think we wouldn’t have so many of these issues that we are dealing with, especially the issues that my local leaders are facing 

today, 3 months later, if the Administration was just willing to say 

let us do our job. Let everybody get in a room, and when there is 

a problem whether it is sand berm which took over 3 weeks to 

issue—Governor Jindal could have protected 10 miles of our marsh 

in the period of time it took to get that permit issued and still to 

this day they are waiting to get an answer back on a rock barrier 

plan to provide protection to some of these other real fragile ecosystems where you got pelican nests and other very vital resources. 


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And instead of getting everybody in the room the approach would 

be sit in that room and nobody leaves until you figure out a way 

to get it done, and if this plan on the table is not the way to do 

it, and there is no perfect plan right now, but whoever’s plan is better, let us do it, but your answer can’t just be we are denying your 

plan and everybody leaves and nothing gets done and more oil gets 

into marshes that didn’t have oil the day before. And that is the 

problem we are facing. So maybe they don’t want to own up to the 

fact that they issued the permit and they are trying to blame other 

people, but the bottom line is we just want to get these problems 

solved and we want the attention of this Administration focused on 

doing their job under the law. The Oil Pollution Act says it is the 

President’s job to protect the coast. Unfortunately, he is not doing 

that. Our local leaders are trying to do it and they are being 

blocked by the federal government. There is no excuse for that. 

Getting back to the moratorium. While there is a moratorium 

that even though the federal courts have said is arbitrary and capricious and the Administration doesn’t have the legal authority to 

issue a moratorium they are saying that there is not a shallow 

water moratorium but, in fact, there are over 40 permits pending 

for new drilling in shallow waters which haven’t been issued so 

there is a de facto moratorium on shallow water drilling. Can you 

talk about the differences between shallow and deep water drilling 

and the consequences of having the shallow water moratorium, 

which is causing even more job losses that even though this Administration says there is no moratorium they are not allowing any 

people being laid off. 

Ms. NORTON. There are often different drilling rigs that are involved in different areas but whether the moratorium is in shallow 

water de facto or in deep water if you are actually going to have 

projects moving ahead and actually going to have the jobs that 

come from those projects, you need to have predictability and so 

there needs to be overall predictability, a focus on safety but also 

a focus on solving the real problems and letting the things that are 

dependable move ahead. 

Mr. SCALISE. Mr. Kempthorne. 

Mr. KEMPTHORNE. I really can’t add anything to that, Congressman. I appreciate that. 

Mr. SCALISE. OK. And I know you both touched on it a little bit, 

but I want to get back to this concept of a 6-month pause. When 

Secretary Salazar says I just want to hold my finger on the pause 

button for 6 months and then at the end of 6 months maybe let 

it go and start things up again as if magically everybody just sits 

around waiting for 6 months and you start it up again. We are already seeing that some of those deep water rigs are leaving. Some 

have already signed contracts to leave the country and take those 

good jobs with it and the energy producing capabilities with it, and 

many others are already in negotiations, and at some point soon 

they are going to be signing their contracts too. But if you waited 

for 6 months—I just want to address that because I do think it is 

disingenuous for people to go around and say there is just a 6- 

month pause and then we will start everything up again. 

If you really do want to halt drilling for a long period of time, 

that is a policy decision and we can debate that, but I don’t think 


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it is fair to the American people to insinuate that you can just stop 

everything for 6 months and then start it back up again magically 

and everything will work just fine. If you could both address this. 

At what point down the road do you severely limit the ability for 

an industry to come back in a short period of time and, in fact, 

maybe years? 

Ms. NORTON. I know from our hurricane experience with Rita 

and Katrina that, yes, there was a lot of damage that had to be 

repaired but it took far—— 

Mr. SCALISE. I commend you on your work in getting those issues 

addressed quickly. 

Mr. STUPAK. Your time has quickly evaporated, Steve. 

Ms. NORTON. We just found it took a whole lot longer for the industry to recover, for the energy production to recover than we 

would have expected. 

Mr. STUPAK. Secretary Kempthorne, did you want to add something? 

Mr. KEMPTHORNE. Very brief, if I may. Businesses need to have 

business plans. They need to have predictability as long as you put 

this question as to whether or not and when they might be able 

to come back. Also, we need to put it into human terms. The employees that draw their livelihood from the drill rigs and that entire industry, what do they do for 6 months during the pause? How 

do they derive their income for their families? 

Mr. SCALISE. Thank you, Mr. Chairman. 

Mr. STUPAK. Well, that concludes all time for this panel. I want 

to once again thank Secretary Kempthorne and Secretary Norton 

who voluntarily came here and gave of their time to help us with 

this problem, this disaster that our country is facing, and we thank 

you for your insight and the answers to all of our questions. With 

that, this hearing will be in recess until 2:05. We will take a 10- 

minute break. We will be right back with the next panel. We are 

in recess. 

[Recess.] 

Mr. MARKEY [presiding]. We welcome everyone back. Again, this 

is a joint subcommittee hearing of the Oversight and Investigations 

Subcommittee of the Energy and Commerce Committee, and the 

Energy and Environment Subcommittee. We have been conducting 

this investigation jointly for 90 days, and we will continue to do so 

today. Our sole witness on our second panel is the Secretary of Interior, Ken Salazar, who was confirmed as Secretary of Interior on 

January 20, 2009. Prior to that service, he served in the United 

States Senate, representing the State of Colorado and before that 

he served Colorado as its Attorney General. So we welcome you, 

Mr. Secretary. It is the policy of this committee to take all testimony under oath and please be advised that you have the right 

under the rules of the House to be advised by counsel during your 

testimony. Do you wish to be represented by counsel? 

Secretary SALAZAR. No. 

Mr. MARKEY. Then would you please rise and raise your right 

hand to take the oath? 

[Witness sworn.] 

Mr. MARKEY. Let the record reflect that the witness replied in 

the affirmative. You are now under oath. So now we will welcome 


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you again, Mr. Secretary. Whenever you feel comfortable, we ask 

you to please begin your testimony. 

TESTIMONY OF THE HONORABLE KEN SALAZAR, SECRETARY 

OF THE INTERIOR 

Secretary SALAZAR. Thank you very much, Chairman Markey 

and Chairman Stupak, and Ranking Members Upton and Burgess 

for this opportunity to come and testify in front of this committee 

concerning the Deepwater Horizon tragedy and what it has meant 

for this country and for this government and for the Department 

of Interior. Let me at the outset say that from April 20 until today, 

including this morning, we have continued a nonstop and relentless 

effort to kill the well to stop the oil from leaking from the well, and 

to do everything we can to keep the oil from coming on shore. It 

has been a coordinated effort on the part and at the direction of 

President Obama that has included the whole of government and 

putting every resource that we have and that the President has directed. We will not rest until we have this problem fully under control. 

The status of the well today, since I thought it might be of interest to the committee, is that it continues under shut in having 

pressure of approximately 6800 psi. There is an intensive monitoring program which we have directed BP to implement so that 

we can monitor seeps and any other kind of changes as the well 

integrity test continues. The essence of the regime that we are 

under right now is a 24-hour license that BP is given every 24 

hours and based on the review of the seismic, acoustic, sonar and 

other information that we are getting then we make a decision 

about whether they can move forward for another 24 hours. The rationale for that intensive surveillance program is that it is important for us that this well maintained well integrity so that we don’t 

have a catastrophe with the well bore essentially blowing out and 

then having all the contents of the reservoir blowing out into the 

sea. 

So we continue to spend a great amount of time. In fact, this 

morning as this hearing was going on, that is what I was working 

on. I did listen to parts of the testimony, including parts of the testimony from my predecessor, Secretary Kempthorne and Secretary 

Norton. Let me at the outset say that this is a tragedy because 11 

people have been killed, and there has been environmental devastation in the Gulf of Mexico which we are dealing with now. And 

will continue to deal with into the future. There is a tendency to 

blame everybody who is involved and in my point of view there is 

a shared responsibility, a collective responsibility, for how we respond to this issue. I would suggest to all of you that based on your 

investigations and based on preliminary investigations from BP as 

well as preliminary investigations that I have seen that indicate 

that there were corners that were cut by BP as it moved forward 

with respect to this well construction. 


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You are as a committee very aware of what some of those are 

and you have reported on some of your findings. I would also say 

that prior administrations and this Administration have not done 

as much as we could have done relative to making sure that there 

was safer production in the Outer Continental Shelf. I believe that 

after drilling some 40,000 wells in the Gulf of Mexico that all of 

the nation, including the institutions of government, the Congress, 

as well as executive branch and multiple administrations were 

lolled into a sense of safety. And what the Deepwater Horizon perhaps drives home more than anything else is that we need to revisit that basic assumption with respect to safety. 

Let me say that since I came in as Secretary of the Interior the 

President and I discussed the reform agenda of the department and 

made the reform agenda a high priority of mine from day one. Specifically with respect to the former Minerals Management Service 

we moved forward with an ethics reform program in the Department of Interior to do away with the sex and drug scandals that 

we had seen in Lakewood and other places, and most of the activity 

that has been uncovered by the Inspector General is activity that 

has either been referred over to prosecution or appropriate actions 

have been taken with respect to the firing, suspensions or other 

disciplines of those employees who were involved. I will also say on 

that note that most of the employees at the Minerals Management 

Service continue to do their work every day. They are working 

very, very long hours now as we try to bring, for example, the 

Macondo well under control. 

We also moved forward with the reform agenda by terminating 

the Royalty-in-Kind program because the Royalty-in-Kind program 

had become essentially a magnet for the kind of corruption and 

ethics lapses that we had seen over the last 8 years, and so the termination of the Royalty-in-Kind program was a decision that I 

made early on to try to bring an end to the prior corruption. Thirdly, the Outer Continental Shelf and the plans that are put into 

place, many of you will recall that on the last day of the prior administration there was a new plan that was put forth for the OCS 

that essentially covered the entire OCS with respect to future development. We changed the OCS plan. There were some very extensive set of hearings and we were dealing with two different sets 

of plans, one from 2007–2012, and the new plan that was proposed 

from 2010–2015, and we narrowed it down so that we are protecting special places in the Arctic, the Chukchi and Bristol Bay 

where we cancelled 5 leases in that area. We took the Pacific off 

from drilling activity and proposed that we move forward in a 

thoughtful way with respect to areas in the Atlantic as well as with 

respect to the Gulf. 

Our intention was to stay away at least 125 miles from the 

shores of Florida. And, finally, as you, Mr. Chairman, with your advocacy, we have followed on your direction that we do everything 

that we can to stand up renewable energy in the offshore especially 

in the Atlantic. We see great hope in that possibility. We believe 

that huge amount of electricity can be generated from wind and 

that is an effort that is well underway. Finally, just in terms of 

how we have moved forward since April 20 and before. We had 

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ments and additional training for employees. We also raised the 

bar on industry, the 30-day safety report, which I prepared at the 

direction of the President, set forth a number of recommendations 

with respect to blowout preventers, venting, casing, and a whole 

host of other things that should make drilling more safely. 

We have moved forward with a safety notice to lessees which essentially is a recall of the blowout prevention mechanisms and requirement responder casing and well design requirements. That 

notice to lessees has been sent and we also have sent a notice to 

lessees with respect to blowout prevention. We are moving forward 

with the reorganization of what was formerly the Minerals Management Service and created the Bureau of Ocean Energy Management, Regulation, and Enforcement. That effort is led by the Assistant Secretary of Land and Minerals, Wilma Lewis, who was a 

former United States Attorney and Inspector General with the Department of Interior, and the agency itself will be led by Mike 

Bromwich, who also was an Inspector General for a very long time 

in the Department of Justice and who has been involved in the organization matters within the private sector. 

The reorganization of the new MMS, the new Bureau of Ocean 

Energy, essentially will have 3 units. There will be an Office of 

Natural Resource Revenue, and that is to separate the revenue collection function from the other functions related to leasing the resource. A second unit will be one of Bureau of Ocean Energy Management unit, which will essentially make the decisions about 

where it is that we will be leasing the OCS resources for development. And the third unit will be one that will be focused exclusively on safety and environmental enforcement. This will not come 

cheap. When one looks at what has happened in the 1990’s and 

through the first decade of this century the staffing levels at MMS 

have essentially remained static. We have made requests for additional staff in the last few years. The proposal that we have before 

the Congress and before OMB contemplates an additional 445 inspectors to help us in carrying out this very important duty for the 

American people. 

I will comment just briefly on the moratorium because I know 

many of the members of this committee are interested in that. It 

is a moratorium that I have reissued that will stay in place until 

November 30 until I am satisfied that we have received appropriate and adequate answers to 3 essential questions. First, whether or not drilling can continue in a safe manner. Second of all, 

whether or not there is an adequate strategy to deal with blowout 

containment, issues like the one that we are facing, and, thirdly, 

that there is an adequate oil spill response capability that is out 

there. In conclusion, Mr. Chairman, I am hopeful that working 

with the members of this committee and members of the Congress 

that the legacy of this crisis will be four fold. First, that we will 

move forward to an era of safer production of oil and gas in the 

Outer Continental Shelf. Secondly, that we will embrace a Gulf 

Coast restoration program which Secretary Mabus and the Administration are leading in a way that finally restores the Gulf Coast 

after a century of degradation. Third, that we can embrace a conservation agenda for the 21st Century across America. And, finally, 

that it will open up the great possibility to a new energy future 


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that broadens the portfolio of energy which this country had been 

so dependent on with respect to fossil fuels to now include the 

power of the sun, the power of the sun, the power of geothermal, 

and the other parts of the energy portfolio, which the President has 

as part of his comprehensive energy plan. 

[The prepared statement of Mr. Salazar follows:] 


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STATEMENT OF KEN SALAZAR 

SECRETARY OF THE INTERIOR 

BEFORE THE 

COMMITTEE ON ENERGY AND COMMERCE 

U.S. HOUSE OF REPRESENTATIVES 

ON THE CONTINUING REFORM OF THE 

OUTER CONTINENTAL SHELF PROGRAM 

JULY 20, 2010 

Chairman Waxman, Ranking Member Barton, and Members of the Committee, thank you for 

holding this hearing today as we continue to address the issues and challenges associated with 

reform of the Department of the Interior's offshore energy program. 

Offshore Energy Reforms Completed 

The reforms we have embarked on over the last year and a half are substantive and systematie, 

and we will continue to build on them. The fundamental changes we are making do not corne 

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. But this unprecedented disaster at the 

Deepwater Horizon has only strengthened our resolve. We believe that our reform efforts are 

crucial to ensuring that we carry out our responsibilities effectively, without compromise, and in 

a manncr that facilitates the balanced, responsible, and sustainable development of the resources 

entrusted to us. 

I want to review reforms we have already undertaken: 

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

collection side of the MMS. We: 
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• upgraded and strengthened ethics standards and enforcement 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 Gam, 

Second, we reformed the offshore oil and gas regulatory program, and: 

• initiated, in the Fall of2009, 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 necessary increases in the MMS budget for FY 2010 and FY 2011, including a 

10 percent increase in the number of inspectors for offshore facilities; and 

• developed a new approach to ongoing oil and gas activities on the Outer Continental 

Shelf (OCS) aimed at promoting the responsible, environmentally-sound, and 

scientifically-grounded development of oil and gas resources on the OCS. 

In reversing the plans of the previous administration, and charting a new course for oil and gas 

development on the OCS, we cancelled the upcoming Beaufort and Chukchi lease sales in the 

Arctic, removed Bristol Bay altogether from leasing in both the current five-year plan and the 

next five-year plan, and removed the Pacific Coast and the Northeast entirely from any drilling 

under a new five-year plan. We made clear that we will require full environmental analysis 

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through an Environmental Impact Statement prior to any decision to lease in any additional 

areas, such as the mid- or 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 ofMMS 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: 

• finalized long-stalled regulations for off-shore wind cntting through jurisdictional 

disputes -- and approved the Cape Wind project; 

• announced the establishment of a regional renewable energy office to coordinate and 

expedite the development of wind and other renewable energy resources on the Atlantic 

Outer Continental Shelf; and 

• entered into an MOU with govemors 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. 

Reorganization of the Minerals Management Service 

I appointed Michael Bromwich as BOEM Director on June 15th Michael, a former Inspector 

General of the Department of Justice and, more recently, an attorney in private practice, will lead 

us through the reorganization, which will lay the foundation for the reforms we have underway. 

He will lead the changes in how the agency does business, implement the refonns that will raise 

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the bar for safe and environmentally-sound offshore oil and gas operations, and help onr Nation 

transition to a clean energy futnre. 

For the same reasons I ehose 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 tennre 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 ofleasing programs and the development 

of renewable energy programs onshore, to support for onr stndy of policies designed to ensnre 

fair retnrn to American taxpayers for the development of public oil and gas resonrces. 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 ofMMS toward a new futnre. 

In a May 19 Secretarial Order, I restructnred the MMS, separating the bnreau' s resonrce 

management, safety, environmental oversight, enforcement, and revenue collection 

responsibilities, and reassigned those functions to three new entities within the Department: the 

Bnreau of Ocean Energy Management, the Bnreau of Safety and Environmental Enforcement, 

and the Office ofNatnral Resources Revenue. I also 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 an 

implementation plan for the reorganization of the Department's offshore energy program. 

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The plan is based on the premise that the activities formerly carried out by the Minerals 

Management Service must be clearly defined and distinct from one another in order to eliminate 

both real and perceived conflicts within the organization. Another key objective of the 

restructuring was to establish necessary checks and balances in the relationship of the three new 

entities, but to also ensure that critical linkages among the three organizations were maintained 

to provide a predictably administered program. The plan balances the imperative to move 

quickly with the analysis and planning required to effectively achieve the identified objectives. 

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 five years. 

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 learned from the event. We are taking 

aggressive action on multiple fronts, including: 

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

• issuing a safety notice to all rig operators in the Gulf; 

• implementing the 30-day safety report to the President, including issuing notices to 

lessees on new safety requirements, developing new rules for safety and environmental 

protection, and issuing suspensions of deepwater drilling on the OCS to ensure that oil 

and gas companies implement adequate safety measures to reduce the risks associated 

with deepwater drilling operations; and 

• requiring operators to submit information in their exploration plans regarding blowout 

scenarios- 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 ofMMS personnel to adequately enforce standards or inspect the 

Deepwater Horizon. 

Further, on April30'h 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 

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General Mary Kendall, will develop reeommendations designed to enhance safety and 

environmental protection and improve overall management, regulation, and oversight of 

operations on the Outer Continental Shelf. 

The Council on Environmental Quality (CEQ), working ·with the Department of the Interior, is 

conducting a review of National Environmental Policy Act (NEPA) policies, practices, and 

procedures for the Department of the Interior's Minerals Management Service (MMS) decisions 

for Outer Continental Shelf (OCS) oil and gas exploration and development. We anticipate that 

additional reforms will be informed by this review. 

Finally, the President established the independent bipartisan National Commission on the BP 

Deepwater Horizon Oil Spill and Offshore Drilling, which has been tasked with providing 

options on how we ean prevent and mitigate the impact of any future spills that result from 

offshore drilling. 

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

that they will pay for the costs of the government's response to the spill, and compensate 

individuals, families, and business for losses and damages that arise from the spill. We will do 

everything in our power to make the affected communities whole. As part of this effort, last 

Thursday BOEM Director Michael Bromwich notified BP in writing that it is required to pay 

royalties on all oil captured from the leaking well and that it may also be responsible for royalties 

on any oil lost or wasted from the well if it is determined that such loss or wasted oil was due to 

negligence or regulatory violations that contributed to the tragedy. 

Supplemental Legislation 

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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 10 percent increase in the number of inspectors. Our restructuring of the OCS 

program will require additional resources to implement the aggressive reforms we are pursuing. 

Weare currently hiring an additional 12 inspectors and taking other actions that are outlined in 

the 30-day report to the President. Our restructuring of a more robust OCS regulatory 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 to fund near term 

resources for these activities. These funds are critically needed to bolster inspections of offshore 

oil and gas platforms, draft health, safety, and environmental protection regulations, develop the 

required enforcement measures for these new 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 days to up to 90 days. 

This is also necessary, and I urge Congress to include it in the final version of the supplemental. 

Sustained Response Efforts in the Gulf 

My staff and I have worked virtually non-stop to address the Deepwater Horizon incident since 

April 20th• I personally have worked in Houston, Louisiana, Mississippi, Alabama, and Florida 

many days since then to help with efforts to both stop the oil spill and to protect the coasts, 

wetlands, marine environments, and wildlife threatened by this spill. We have deployed over 

1,000 employees to the Gulf, and they have been 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. 

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Under the direction of Admiral Thad Allen, we remain hopeful that the well will soon be killed 

and the planned cementing operations will ultimately seal the well. And good progress is being 

made on drilling the relief wells. Oil spill containment and clean up of the Gulf remains of 

utmost importance to us. 

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

approximately 600 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. 

And Dr. Marcia McNutt, my science advisor and the Director of the United States Geological 

Survey, has been at the Unified Command Center in Houston almost continuously since May 

2010, providing science-based and technical expertise, coordination, and oversight to BP's 

efforts to contain the leak and kill the well. 

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. 

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Finally, there are many people in the Department devoting significant time and energy to various 

investigations and inquiries that are being carried out and to the ongoing reorganization and 

rcfonn, I want to acknowledge their work and let them know their efforts are appreciated and 

are not going unnoticed, 

Over the last several months, we have seen what the employees in the Bureau of Ocean Energy 

Management, Regulation and Enforcement are capable of -- their professionalism, dedication to 

the Department, and enthusiasm for the refonns underway. With Michael's help we will be able 

to cast aside the shadow that was left by an errant few, as well as the old policies that prioritized 

production over ethics, safety, and the environment 

Conclusion 

Much of my time as Secretary of the Interior has been spent working to refonn old practices of 

the MMS and 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, eonventional oil and gas continues to playa 

significant role in our economy, As we evaluate new areas for potential oil and gas exploration 

and development on the OCS, we will work with other federal agencies to conduct thorough 

environmental analysis and scientific study, gather public input and comment, and carefully 

examine the potential safety and spill risks, 

10 
139 


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

will provide us with the facts and help us understand what happencd 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. 

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. 

This Administration will continue its relentless response to the Dcepwater Horizon tragedy. Our 

team is committed to help the people and communities of the Gulf Coast region persevere 

through this disaster, protect our important places and resources, and take actions based on 

valuable lessons learned that will help prevent similar spills in the future. 

11 
140 

Mr. MARKEY. Thank you, Mr. Secretary, very much. The chair 

will recognize the chairman of the Oversight and Investigations 

Subcommittee, the gentleman from Michigan, Mr. Stupak. 

Mr. STUPAK. Thank you, Mr. Markey. Thank the chairman. Mr. 

Secretary, thank you for being here and thank you for all your 

work. This has not been an easy issue for any of us and especially 

your position as Secretary of Interior. You have been putting in a 

lot of hours and long days in working this, and we thank you for 

your efforts. Let me ask you this question. I asked both Secretary 

Norton and Secretary Kempthorne this question. The modeling we 

have for if an oil spill would work our only models deal with surface spills, not deep water spills. In 2005 MMS modeling team 

asked the secretary that the spill response plans need to be updated to deal with deep water releases. It has never been done. 

Were you aware when you took over that there was never a modeling program to show what would happen with a deep water spill 

in the Gulf of Mexico? Were you aware that nothing has been done? 

Secretary SALAZAR. The answer to that is no, I was not aware of 

that. 

Mr. STUPAK. And my follow-up question then, should we update 

the model before we go back to drilling? I know we have this moratorium on right now but shouldn’t we have some idea—maybe we 

can learn something from Deepwater Horizon how catastrophic 

spills would go in the Gulf. Is that enough reliance or should we 

do modeling before we resume exploration and drilling in the Gulf 

of Mexico? 

Secretary SALAZAR. Chairman Stupak, I think what we need to 

do is make sure that we have adequate plans to response to the 

3 key issues that I just spoke about, and at the end of the day if 

you think about the containment program that has been underway 

since the Macondo well blew out, I think there is ample evidence 

that you have seen which I have reviewed every single day since 

April 20 and the efforts to close down the well that tells us that 

the containment efforts are simply not enough, and so it is an opportunity to really address all of the multitude of shortcomings 

that have become evident since April 20. 

Mr. STUPAK. Since our investigation, I have been focusing a lot 

on the blowout preventer requirements, and as far back as 1997 

MMS cut back on testing requirements for the BOPs by reducing 

required testing frequency from every 7 days to every 14 days because testing caused down time on the rigs. But a series of reports 

conducted between 2001 and 2004 pointed to even bigger problems. 

Over and over again these reports indicated that in many cases 

blowout preventers would not be able to shed drill pipe in an emergency. If the BOP cannot shed a pipe then it cannot seal the well 

to control a blowout. A 2001 report concluded that sub-sea blowout 

preventers should be equipped with redundant shear rams to increase the chances of success in an emergency. A 2002 report cited, 

and I quote, ‘‘a grim picture of the success when using BOPs in an 

emergency.’’ A 2003 report identified problems with emergency activation systems and the need for remote undersea vehicles to operate all BOP functions in an emergency. The warnings from 2001 

through 2004 seem to have anticipated the very problems that have 

come to pass in the Deepwater Horizon blowout. 


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Mr. Secretary, my understanding is that MMS established new 

rules for blowout preventers with rulemaking in 2003, but they did 

not require dual shear rams or other key improvements that the 

studies indicated were necessary. Is that correct? 

Secretary SALAZAR. That is correct. Those requirements were not 

required. 

Mr. STUPAK. On the rule that was made by Secretary Norton, I 

asked her about that, and I realize it was not your decision, but 

in retrospect do you think that the 2003 federal rule based on these 

studies should have had the dual rams shearing capabilities in case 

of a blowout prevention—in case of a blowout of a well? 

Secretary SALAZAR. My own view, Chairman Stupak, is that 

there has been a lot learned with respect to these blowout preventers including the need to make sure that you have the shearing capability, and indeed some of the blowout preventers that are 

now being manufactured will require the dual capacity with the 

shear rams in case they end up closing in on a place where you 

have a pipe that they cannot get through. 

Mr. STUPAK. Well, let me ask you because your 30-day report on 

the Deepwater Horizon contained a number of new recommendations for BOPs including the dual rams shearing as you indicated. 

Can you tell me some of the other recommendations and actions 

that the Department of Interior will be taking to implement safer 

BOPs? 

Secretary SALAZAR. The recommendations are many, and they 

are outlined extensively in that 30-day report as well as in the notice to lessees that we have issued additional rules that we will be 

making. Some of the blowout prevention enhancements that you 

will be seeing will deal with the shearing capability of rams but 

other improvements that have to be in my mind put into place as 

well include assurance that the backup actuation programs do, in 

fact, work. And we will be making those requirements and have 

made some of those requirements with respect to the 30-day report. 

Mr. STUPAK. Well, you talked about the need to hire 445 more 

inspectors. Will this enhance the certification and testing of these 

blowout preventers and other aspects that you have recommended 

in your 30-day report? 

Secretary SALAZAR. Absolutely, Chairman Stupak. And let me 

say that as much criticism as may be laid in terms of what has 

happened in the last 90 or 91 days since April 20, it also has been 

a great laboratory of learning. There was a conclusion that essentially was a conclusion that most people had that you could not test 

the blowout prevents sub-sea. We now know that that is not the 

case and so there will be additional testing requirements that will 

also be imposed with respect to blowout preventers. 

Mr. STUPAK. Thank you, Mr. Secretary. Thank you, Mr. Chairman. 

Mr. MARKEY. The gentleman’s time has expired. The chair recognizes the ranking member of the Energy and Environment Subcommittee, the gentleman from Michigan, Mr. Upton. 

Mr. UPTON. Thank you. Welcome, Mr. Salazar. Go blue, right? 

Secretary SALAZAR. Go blue. 

Mr. UPTON. Michigan Law School, you didn’t say that. I don’t 

know if you have had a chance to look at the bill that the Full 


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Committee reported out last week, 48 to nothing, H.R. 5626, the 

Blowout Prevention Act. I know that as a number of us were trying 

to seek comments from the Department, I don’t know if there was 

a clearance problem at OMB, but we really didn’t get any comments from the Administration as it related to the progress of this 

bill. 

I don’t know if you had a chance to look at it, and now that it 

has been reported out, I wondered if you might want to comment 

on certain provisions that still may be constructive as we look at 

this bill before it gets to the House Floor. 

Secretary SALAZAR. Congressman Upton, I first of all agree that 

this committee put its focus on one of the very key issues that 

needs to be addressed and that is blowout preventers. And so I appreciate the work from this committee, and the fact that you had 

that kind of a bipartisan support for that legislation shows that it 

was a well thought-out piece of legislation. We are currently in the 

process of reviewing that legislation along with a host of other 

pieces of legislation that are making their way through Congress, 

and I look forward to working with all of you because I do think 

that it is a bill that we can work with. And so there may be some 

modifications or changes that we will request, but we have not yet 

had the opportunity to dig into it in detail but we will. 

Mr. UPTON. You indicated in your testimony that you are doing 

in essence a 24-hour license every single day with BP. What would 

happen if you actually denied them a 24-hour bill? Would you all 

take over? What would happen? 

Secretary SALAZAR. Essentially what would happen is they would 

have to go back into a containment mode and that is to essentially 

minimize the amount of oil that ultimately gets spilled out into the 

Gulf. And so prior to the time that the shut-in occurred, they were 

capturing on the average of about 24,000 to 25,000 barrels of oil 

a day so that there would be a resumption of some of that oil containment capacity as well as a program which we required. We ordered BP to develop a program that put in different scenarios with 

different oil containment capacity, leading up to as much as 80,000 

barrels a day of containment capacity. 

What would happen as you would transition though from a shutin of the well over to a leak containment program is that during 

that interim period, there would be some flow of oil out into the 

Gulf. 

Mr. UPTON. Former Secretary Kempthorne who was here earlier 

this morning in his testimony voiced the frustration to the degree 

that they had sought more money for inspectors, in essence about 

$2 million more than what Congress provided. You indicated just 

now that you are looking for about 445 more inspectors. I am just 

wondering if the ideas fostered within the Administration to perhaps go about like a user fee on the industry itself, like we have 

an escrow account now to pay, I hope, every dime of—or an escrow 

account for every dime for the losses—et cetera, for folks along the 

Gulf. Should you not be able to get money from the Appropriations 

Committee, do you have the authority, would you seek authority to 

in fact impose a user fee to then provide for these additional inspectors that you are calling for? 


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Secretary SALAZAR. We are working closely with OMB and work 

closely with the Appropriations Committee relative to the additional resources that are needed and how we fund them. And I 

know everybody here agrees that we need to find ways for paying 

for some of these things, and so that is part of the conversation 

that is taking place. 

The number that I gave to you in terms of 445 inspectors is what 

we believe we would need over about a 3-year timeframe to be able 

to do an adequate job of inspecting the oil and gas activities in the 

outer Continental Shelf. As I think I heard some of you say this 

morning, it would be almost impossible, frankly, for 60 inspectors 

to be expected to go out and do the job when we are talking about 

4,000 very complicated facilities that they have to inspect in the 

Gulf of Mexico. 

Mr. UPTON. What role do you expect that the President’s Oil 

Spill Commission will play in the decisions about the moratorium? 

Do you expect that commission to offer advice as it relates to the 

moratorium and how would you use it? 

Secretary SALAZAR. You know, we will consult with them relative 

to whether or not it is time for us to remove our hand from the 

pause button, but right now, given the dynamic situation in the 

Gulf of Mexico and the issues that I outlined earlier, from our point 

of view, it would be irresponsible to take off, to take our hand off 

the pause button, as many have suggested. 

And so we will be developing information in the weeks and 

months ahead, including information that is developed by the 

President’s Deep Water Commission. If we are to make an adjustment with respect to the moratorium, it will be dependent on, be 

answering to the three fundamental questions which relate to drilling safety, oil containment and adequacy of oil spill response. And 

if we were to find a way of doing that before 6 months, then there 

would be a possibility of doing something different with the moratorium. But for right now, our view is that it will take until about 

November 30 for us to get that done. 

Mr. MARKEY. The gentleman’s time has expired. The Chair will 

recognize himself for a round of questions. 

Mr. Secretary, in recent days, BP’s Kent Wells said that the company is considering an additional technique known as a static kill, 

a bull-heading, now that the well has been capped. This procedure 

has been described as similar to the top-kill in which mud is introduced at the blowout preventer but may benefit from the current 

stop-flow and lower than expected pressure at the well. What can 

you tell us about this bull-head kill? What are the risks and the 

challenges of the procedure that is now being considered? 

Secretary SALAZAR. The static kill would be a decision essentially 

to try to kill the well from the top. Some have described it in layman’s terms as a sandwich kill because ultimately, everyone has 

known that ultimately killing this well is going to require the relief 

well to kill it from the bottom. But in the interim, what BP has 

been talking about is a possibility of coming in from the top and 

essentially putting in mud and then cementing the well from the 

top. Their view is that it can be done easier now that you basically 

have a shut-in pressure and you don’t have a flowing well. 


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But I think Chairman Markey exemplifies a key role that we in 

the United States have been playing with respect to these kinds of 

issues. We will not allow BP to move forward with the static kill 

option if we think that it is going to create greater jeopardy and 

compromise the integrity of the well. 

And so there is a science team which is headed by Secretary Chu 

and includes the directors of all the national labs as well as Director Marcia McNutt from the U.S. Geological Survey, and they are 

reviewing these plans and assessing the benefits and risks. And it 

is on their advice—we will allow the science to lead us to the appropriate conclusion before we stop BP or we green light BP on 

anything. 

Mr. MARKEY. Thank you, Mr. Secretary. If the well is permanently shut in or killed through a static kill, then a definitive determination of flow rates may be precluded, and that would be a 

success for BP in its continued attempt to obscure the true flow 

rate of the well. If, however, we do move to a collection strategy, 

then it would be possible at some point to collect 100 percent of the 

hydrocarbons from the well for a period of time. Why is that important? Because BP will be fined $4,300 per barrel for gross negligence. Each 10,000 barrels that spill out per day for 80 days or 

so would be the equivalent of a $3.5 billion fine, 20,000 barrels per 

day, $7 billion, et cetera. If it was 60,000 barrels per day, then the 

fine would be about $18 billion. 

So Mr. Secretary, can you tell us what is the likelihood that we 

can get as precise a number attached to how much oil has been 

spilled out in the Gulf of Mexico because of the negligence of BP? 

We know that BP is trying to lower their liability. They want the 

maximum amount of ambiguity in terms of what that number is 

so that the ultimate settlement will be lower in terms of what BP 

has to pay to the American taxpayers and to the people in the Gulf 

of Mexico. So can you just give us some sense of how precise ultimately the goal is for the Obama Administration to establish how 

much oil did go into the Gulf of Mexico? 

Secretary SALAZAR. Chairman Markey, I agree with your conclusion that it is absolutely imperative that we have the flow rate determined in a way that is absolute, and we have the best of scientists in the world that have been involved in terms of looking at 

these flow rates. 

The current flow rate of the U.S. Government which came about 

as a result of very extensive scientific work is between 35,000 and 

60,000. There is additional data that has come in relative to pressure as the well was shut in, and that will provide an additional 

opportunity in the days ahead to try to come up with a definitive 

number that will give us the rate of flow at the time of the shutin. But there are other complicated questions, Chairman Markey, 

that our scientists will have to look at, including whether or not 

the amount of flow has changed over time from April 20 until the 

time of shut-in. But I can assure you that the premise here that 

BP be held accountable for everything that it owes to the United 

States of America relative to penalties and other kinds of assessments against BP is essentially imperative for us, requires us to 

make sure that we have accurate flow numbers. 


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Mr. MARKEY. Well, again, I would just say that we know that BP 

will litigate this issue in terms of how large their fine is, as Exxon 

did after the Valdez incident. If it takes 10 years, they will take 

10 years. They will take as much time as they want. I think it is 

critical for us to establish the most precise number right now because ultimately the American taxpayers should be fully compensated for what BP did to America’s ocean. 

We thank you, Mr. Secretary, for being here and for your service 

to our country. 

Let me turn now and recognize the gentleman from Texas, the 

Ranking Member of the Full Committee, Mr. Barton. 

Mr. BARTON. Thank you. I thought you were going to go to Burgess, but I am ready to go. 

Mr. MARKEY. Mr. Burgess pointed toward you. 

Mr. BARTON. Oh, he did? 

Mr. MARKEY. Approvingly. 

Mr. BARTON. All right. He has passed the buck. 

Mr. MARKEY. With recognition. 

Mr. BARTON. All right. Well, thank you, Dr. Burgess, and welcome Mr. Secretary. 

The blowout preventer that failed on April the 20th was supposed to be inspected every 2 weeks, and we have been told that 

this particular blowout preventer was inspected approximately I 

believe 10 days before the accident and passed the test. Is that correct? And can you share with the committee any of the results of 

that particular test? 

Secretary SALAZAR. My recollection, Representative Barton, is 

there was an inspection that did occur in early April of the blowout 

preventer and that there were multiple tests that were conducted 

after that. The inspection would have occurred, and then following 

that, there were I think tests on the blowout preventer April 10th, 

perhaps April 17th, but other days during that time of April. 

Mr. BARTON. So is it correct that this particular blowout preventer that failed on April the 20th when you had the accident did 

pass the inspection earlier? 

Secretary SALAZAR. It did pass the last inspection that was conducted. 

Mr. BARTON. When that inspection or any inspection of these 

ultra deep oil rigs are conducted, is there an MMS inspector onsite 

while the test is being conducted? 

Secretary SALAZAR. The answer to that is no. The answer to that 

is that the tests are conducted by the companies when they are 

testing the blowout preventer. When the inspections occur, you 

don’t have the capacity frankly when the inspector is out there to 

get down and see and conduct the test itself while you are on there. 

And so you take the information that is provided, and you review 

that information as an inspector, and that is what you base your 

findings on. And that is part of the change that I believe needs to 

be made. It ought not to be a circumstance where essentially an 

inspector is taking the word of the company relative to the adequacy of the blowout preventer. 

Mr. BARTON. So current practice has been a self-administered 

test using approved protocol, and then the results of that test are 

forwarded to the appropriate official at MMS, is that correct? 


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Secretary SALAZAR. As I understand it, Chairman Barton, or 

Ranking Member Barton—— 

Mr. BARTON. I like Chairman. That is OK. 

Secretary SALAZAR. Ranking Member Barton. My understanding 

is that is how the process works. 

Mr. BARTON. Has your department had a chance to compare the 

test results of this particular blowout preventer to what happened 

on the accident day and the inspections that have occurred electronically and visually through the remote monitors of this blowout 

preventer? In other words, can you indicate what the anomaly was 

in the accident that caused the blowout preventer not to operate 

when apparently very soon before that, it had operated correctly? 

We have had 90 days as has been pointed out rightfully so by my 

friends on the majority. The failsafe plan was that the blowout preventers would never fail. Well, the blowout preventer did fail. So 

I would think a key component of the investigation would be compare the test results most recently tested with what actually happened and see what the anomaly is. Has that been done and if it 

has, can you share that information with the committee? 

Secretary SALAZAR. Congressman Barton, there are many pieces 

of evidence that need to be collected, including the blowout preventer. The blowout preventer is essentially the black box that has 

to be taken up from the floor of the sea, and none of these investigations will be able to be fully completed until that happens. 

The blowout preventer is now necessary in order to keep the integrity of the well and the well shut-in—— 

Mr. BARTON. I understand that. 

Secretary SALAZAR. So when that blowout preventer comes out, 

there will be a very extensive forensics protocol that will examine 

all of those issues and determine what went wrong. But it is a critical aspect of the Marine Board investigation. It is a critical aspect 

that everybody involved in any of the investigations is focused on, 

and I am sure your committee will be very interested in those findings as well. 

Mr. BARTON. My last question, and I know I have just expired 

my time, why was the Jones Act not waived so that some of these 

international partners could send their equipment to assist in the 

skimming and the clean up immediately? Because I know there 

was a petition to do that. Why was that not granted? 

Secretary SALAZAR. Congressman Barton, I can only say that I 

have worked with the National Incident Commander Thad Allen 

and our entire group from day one, and the Jones Act has never 

been in the way of getting any vessel on board to deal with the oil 

spill response. 

Mr. BARTON. So the international community that wanted to 

send their equipment, the fact that they wanted to send it and 

couldn’t because of the Jones Act, that is just not true, they just 

didn’t send it? 

Secretary SALAZAR. It is not true that the Jones Act was any barrier to bring in any of those vessels—— 

Mr. BARTON. Then why were they not allowed in? I was told it 

was because the Jones Act prevented it. If that is not true, why 

were they not allowed in? 


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Secretary SALAZAR. My understanding, and I can get the National Incident Commander’s verification on this for you, but the 

Jones Act has not been at all a reason for any of these vessels from 

coming in. 

Mr. BARTON. OK. You didn’t answer my last—you have answered 

the first question. You said the Jones Act was not the reason. What 

was the reason? 

Secretary SALAZAR. Again, it is the National Incident Commander Thad Allen that can respond to that. My understanding is 

that there are multiple reasons, including some of them are the 

distance that they were and a host of other reasons. But we can 

get that for you. 

Mr. BARTON. Will you state that the reason is not because somebody in the Obama Administration said they couldn’t, they were 

turned down? 

Secretary SALAZAR. I will—— 

Mr. BARTON. Can you declaratively state that they were turned 

down? 

Secretary SALAZAR. Congressman Barton what I will say this, is 

that no stone has been left unturned in terms of any offer of help 

that could be used, OK? And that certainly has been the direction 

that the President has given to us and that the National Incident 

Commander have been working on from day one. 

Mr. BARTON. I thank the Chair’s discretion. 

Mr. STUPAK. Chairman Waxman for questions, please. 

Mr. WAXMAN. Thank you, Mr. Chairman. Secretary Salazar, good 

to see you. Our committee investigation revealed that BP made a 

series of risky decisions. When they were drilling the Macondo 

well, they used a single string of casing that provided only one cement barrier preventing flow of dangerous gases to the well head. 

They did not use enough centralizers during the cementing process. 

They failed to fully circulate drilling fluids. They failed to install 

a key casing lock-down sleeve. And they failed to conduct a cement 

bond log test to determine if the cement job had failed. Many of 

these decisions did not conform to industry best practices, but BP 

went ahead with them anyway. 

Secretary Salazar, why was BP able to design such a risky well? 

Can you describe for us the regulations on well design and cementing and why they failed here? 

Secretary SALAZAR. Chairman Waxman, the issues you have 

raised with respect to cementing, centralizing, drilling fluid, and 

the rest of the issues that you raised are I know very much a subject of what this committee has looked at. They are very much the 

subject of which the Marine Board is looking at right now. And we 

will have some answers with respect to what happened on each of 

those apparent deficiencies. 

In terms of the regulations of the Department, there are regulations of the Department with respect to each of those issues that 

you raise. Part of the investigation will determine whether or not 

those regulations were followed or whether they were simply broken. But that is part of what the investigation will look at, and 

with respect to MMS employees that were involved in the oversight 

of the regulations and the inspections, I have also asked the Inspector General to take a look at what exactly it was that the MMS 


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employees were involved in the Deepwater Horizon knew or didn’t 

know. 

So we are looking at all those issues, and they are all part of the 

ongoing investigation. 

Mr. WAXMAN. As I understand it, current regulations are performance-based. They essentially tell operators to make sure the 

design is safe but require no specifics on how to do so. In the wake 

of the BP disaster, you called at least for new regulations regarding 

the well design and cementing. Can you describe your recommendations and how you intend to implement them? 

Secretary SALAZAR. The regulations are first in terms of drilling 

safety and cementing and casing. Chairman Waxman, many of 

them are spelled out in the 30-day report that we submitted to the 

President, and those regulations in many ways are then reflected 

in the legislation which this committee acted on. 

We are implementing those recommendations through notice to 

lessees, two of them that have already gone out to cover a number 

of those recommendations and are in the process of moving forward 

with additional regulations, including a new set of rule-making. In 

addition to that, the new Director of the Bureau of Ocean Energy 

is hosting a number of public outreach meetings to make determinations as to whether or not additional changes are needed. 

So it is a dynamic situation, but we are not waiting around until 

November 30 or January 1 in terms of making changes that need 

to be made. There are many changes that are being made as we 

speak. 

Mr. WAXMAN. A number of the recommendations that I believe 

was the commission that you set up proposed were embodied in 

legislation that was passed by this committee called the Blowout 

Prevention Act of 2010. The legislation would not let BP or any 

other company take the same shortcuts that were taken on the 

Macondo well. This legislation requires multiple barriers to prevent 

gas flows in the well. It requires circulation of the fluids and adequate centralization of the casing. It would mandate the use of a 

lockdown sleeve. It would require cement bond log testing of key 

cement jobs. It would also require third-party certification that the 

well design is safe, making the regulator’s job easier. I believe this 

proposal that came out of our committee will help you in your effort to improve safety of deep water drilling. The requirements in 

this legislation will go a long way toward preventing blowouts and 

making sure that regulators have the tools they need to keep well 

operators from taking dangerous shortcuts. 

That was the intent of our legislation. It was based on some of 

the recommendations your people had proposed, and it would not 

prevent you from revising those regulations and updating them as 

you saw necessary. But the emphasis, the shift in emphasis, would 

be that there would be things that would be required to be done 

before the drilling permit would be agreed to, not just simply that 

that company is going to say that they will live up to a performance standard and then when they failed, then we are looking after 

the fact as we now are dealing in the BP case. 

We want to work with you. We want to make sure this never 

happens again. And we hope when we pass this legislation and you 


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are finished with your job, we can assure the American people of 

safety in the drilling of these wells. 

I yield back my time. 

Secretary SALAZAR. I agree with you very much, Chairman Waxman. And let me say, I appreciate the leadership of this committee 

and focusing in on what was supposed to be the failsafe. That 

failsafe essentially was what lulled the American public, this Congress, multiple executive branches and secretaries and presidents 

to say that this was safe. And so your focus on that particular issue 

is one that I very much appreciate, and we are reviewing your bill 

and I expect that we will work things out with your staff relative 

maybe to some technical issues. But the thrust of it is absolutely 

correct. 

Mr. WAXMAN. Thank you very much. 

Mr. STUPAK. Mr. Burgess for questions. 

Mr. BURGESS. Thank you, Mr. Chairman. Mr. Secretary, welcome 

to our committee. Who is going to be responsible for—fast forward 

when the well is shut in, the blowout protector will be removed by 

someone and examined by someone. Can you tell us the process 

you intend to follow? Who will be charged with removal and who 

will be charged with the forensics on the blowout protector? And 

this is essentially a crime scene, as I understand it. Is that not correct? 

Secretary SALAZAR. Yes, interestingly, Congressman Burgess, we 

have put together an effort which I have asked Deputy Secretary 

Dave Hayes to work with the Department of Justice and the National Incident Commander Thad Allen to assure that the appropriate protocols are followed because this is Exhibit A, if you will, 

in a whole host of matters that will unfold before the country in 

the year ahead. It is the black box, and so we need to make sure 

that the right protocols are followed, and those are being developed. 

Mr. BURGESS. Well, there is a lot of course to determine who is 

at fault and was there negligence. But then of course, from our perspective, we wrote a law that you just referenced dealing with preventing the problem from ever happening again. But we don’t know 

what happened that caused the problem that we are dealing with 

now. 

So obviously it needs to proceed on two tracks, but they are both 

extremely important. One is important from settling criminal 

issues and liability issues in regards to this accident and one is important to settling the issues as to how we do proceed in the future 

with this type of activity. Now you—— 

Secretary SALAZAR. I agree with you, and if we could we would 

be doing the forensics on it right now. The problem and reality is 

that—— 

Mr. BURGESS. You can’t move it. 

Secretary SALAZAR [continuing]. It is needed to keep the well in 

control for right now. 

Mr. BURGESS. Sure. 

Secretary SALAZAR. But as soon as it is over, I guarantee you, the 

protocol will take over. The United States is in charge. The United 

States will be in charge of the blowout preventer and will be in 

charge of the forensics and the evidence. 


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Mr. BURGESS. Will BP be the one that removes it from the ocean 

floor? 

Secretary SALAZAR. That will be part of the protocol, and it will 

probably be with oversight from the United States Government. 

But that will be part of the protocol that we are working on. 

Mr. BURGESS. Let me just ask you this very briefly. You referenced to an answer to a question I think of Mr. Stupak, or maybe 

it was Mr. Markey’s, that Secretary Chu was having some input 

into monitoring the condition of the well as it currently exists as 

to whether or not the pressures are acceptable, neither too high nor 

too low. I know Dr. Chu is a brilliant man, but does he have experience with well design? 

Secretary SALAZAR. What I will say is he is a Nobel laureate and 

my extensive work with him in the last 90 days, he is probably the 

most brilliant man on the planet. And having him in a position—— 

Mr. BURGESS. With all respect, the President is a Nobel laureate, 

but I don’t know that he would be the best person for that job. 

Secretary SALAZAR. But if I may, what Secretary Chu has done 

with my assistance and my working with him is we have assembled the best team. You would be proud of them, Congressman, of 

scientists from around the country, from the Federal Department 

of Energy labs, Sandia Labs, Tom Hunter, Marcia McNutt from the 

United States Geological Survey. And they have collective petroleum—— 

Mr. BURGESS. But they don’t design wells, with all due respect. 

All I am concerned about here is you referenced the fact that BP 

may want to do something different from what the Department of 

Interior wants. At some point, if there is a divergence of opinion, 

does BP lose any of their liability if the Department wants them 

to go in a direction that they are uncomfortable in going or if they 

said, we really just want to go ahead and shut this thing in with 

whatever you called it, the bull hammer approach now. Who ultimately gets to make those decisions and then what release of liability is there for the party of the first part, BP, if the wrong decision 

is made? 

Secretary SALAZAR. The United States is in charge. The United 

States working through the National Incident Commander will give 

the approvals and authority on the way forward. Those decisions, 

Representative Burgess, will be guided by the best of what the 

science community tells us, and we have the best of the science 

world involved in this issue. 

Mr. BURGESS. I wish we could all be so sure. We don’t even know 

about the presence of—down there or the ultimate of the potential 

for collapse of the well head. I mean, that has been a concern since 

it was raised in this committee some six weeks ago. So I wish I 

could share your certitude about that. 

I have got a number of questions related to the moratorium. I 

hope we will have the opportunity to submit questions in writing 

because I think this is important. But have you done a risk analysis on the likelihood of other wells failing in the Gulf? 

Secretary SALAZAR. The moratorium decision which we issued in 

a 20-plus page document laid out the factors related to my decision. 

My decision essentially was based around three key factors which 

there is tremendous evidence in the record to support and tremenVerDate Mar 14 2013 04:56 Mar 20, 2013 Jkt 077922 PO 00000 Frm 00156 Fmt 6633 Sfmt 6633 E:\HR\OC\A922.XXX A922

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dous evidence which I know this committee has seen uphold before 

its very eyes. And those issues relate to drilling safety, oil containment and oil spill response. Today, if there was another oil spill response requirement in the Gulf of Mexico or somewhere else, we 

would not have the capacity to respond to it because all of the resources essentially are focused in on dealing with the blowout at 

the Macondo well. 

Mr. BURGESS. Before I am gaveled down, would you supply that 

risk analysis for the committee for the record? 

Secretary SALAZAR. We will supply you a copy of my decision 

which essentially includes reference to a very extensive record. 

Mr. BURGESS. Actually, the paper supporting the decision would 

be what the committee would benefit from. 

Secretary SALAZAR. We will work with your staff to figure out exactly what it is that you want, but we do—the decision that was 

made last week and communicated last week was a very wellthought-out decision which—— 

Mr. BURGESS. But based upon some set of facts, and if the set 

of facts could be—— 

Mr. STUPAK. The gentleman’s time—— 

Mr. BURGESS. —provided to the committee, that is what we 

would appreciate. 

Mr. STUPAK. Mr. Dingell for questions, please. 

Mr. DINGELL. Mr. Chairman, thank you. Mr. Secretary, a pleasure to se you before the committee. Thank you for being here. 

Mr. Secretary, I am troubled. Where in the statute does NEPA 

allow for categorical exclusions? What is the citation in the statute 

which permits that? 

Secretary SALAZAR. Congressman Dingell, I think you get to the 

broader question with respect to the environmental review of oil 

and gas leasing in the outer Continental Shelf. 

Mr. DINGELL. No, Mr. Secretary, this is a very specific question. 

I say this with the great affection and respect. But NEPA says that 

every single action which has a significant impact upon the human 

environment shall be accompanied by an environment impact statement. Nowhere in that statute—and by the way, Scoop Jackson 

and I wrote this in the late ’60s and early ’70s. Nowhere in the 

statute is there authority given for a categorical exclusion. Is it the 

interpretation of your agency that there is a categorical exclusion 

in this or is it the interpretation of the Council on Environmental 

Quality that such be so? 

Secretary SALAZAR. It is founded in law and it has to do with 

this. Chairman Dingell, if you, with all due respect, there was an 

environmental impact statement that was conducted with respect 

to the 2007 to 2012 plan. There was another environmental impact 

statement with respect to this particular—— 

Mr. DINGELL. Here is the way it worked, Mr. Secretary, and let 

us refresh our collective recollections. There was essentially a generic environmental impact statement issued for the entire block in 

which the lease existed as opposed to a specific lease, and I am trying to figure out what transpired here. I hear talk that there is 

some kind of a device for a categorical exclusion. I want to make 

sure that your department is not misinterpreting the statute or 


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that the statute has not been improperly amended at any time 

since Scoop Jackson and I got it into law. 

Secretary SALAZAR. Let me say that the fix here is what the 

President and I have proposed to the Congress and that is there 

is a requirement in the law under—an expiration plan to be approved within 30-days of its submission. And so what we have 

asked is that that timeframe be extended from 30 days to 90 days 

in order to be able to do the appropriate environmental review. So 

that is one of the areas that we hope to work with the Congress 

on to make sure that the way in which categorical exclusions have 

been used in the past is not the way they are used in the future. 

Mr. DINGELL. I think, Mr. Secretary, in the interest of time, I 

would like to submit this and ask that you respond for the purpose 

of the record. Have there been any categorical exclusions, and if so 

how many granted where oil and gas companies got licenses to 

drill? If so, how many? I will permit that to be inserted into the 

record. So would you submit that for us, please? 

Now, Mr. Secretary, tell us about this cement bond log. No such 

test was performed on the Macondo well, is that correct? 

Secretary SALAZAR. Chairman Dingell, the answers to those 

questions are still a part of the investigation. 

Mr. DINGELL. OK. 

Secretary SALAZAR. Your committee has found that—— 

Mr. DINGELL. Would you submit that, please, Mr. Secretary, for 

the record? 

Secretary SALAZAR. But Chairman Dingell—— 

Mr. DINGELL. But I would like you to tell me if Interior does not 

insist that such a test is performed, then how is the department 

to know that that is, rather that the law has been complied with 

and that in fact the lease is being safely and properly executed by 

the oil company? 

Secretary SALAZAR. Chairman Dingell, we have conducted and 

are conducting a comprehensive review of the whole regulatory regime relative to the drilling—— 

Mr. DINGELL. Mr. Secretary—— 

Secretary SALAZAR [continuing]. On the Continental Shelf. 

Mr. DINGELL [continuing]. With respect and affection again, I 

will submit this for the record and ask you to respond. 

Now, Mr. Secretary, it is my understanding the lessees are required to submit a blowout scenario. In 2003, all leases in the Gulf 

were exempted from this requirement unless they fell into four specific categories. In 2006, this was expanded to five. Is this correct? 

Secretary SALAZAR. It is correct that that is the way it was, as 

I understand it—— 

Mr. DINGELL. OK. 

Secretary SALAZAR [continuing]. Chairman Dingell, but it is also 

correct that those are some of the changes that we have already 

made as we have moved forward with the 30-day—— 

Mr. DINGELL. I don’t want to you to feel uncomfortable—— 

Secretary SALAZAR [continuing]. Report to the President of the 

implementation—— 

Mr. DINGELL [continuing]. About this, Mr. Secretary. 

Secretary SALAZAR [continuing]. Of the regulations. 


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Mr. DINGELL. I just want to gather the facts. Now, did the 

Macondo well require a blowout scenario or was it exempted from 

the blowout scenario? 

Secretary SALAZAR. The Macondo well had a requirement with 

respect to a blowout preventer under the regulations. 

Mr. DINGELL. Again, I would like to submit that in a written inquiry. I thank you, Mr. Secretary. 

I ask, Mr. Chairman, that the record remain open for both my 

letter and the response of the Secretary, if you please. 

Mr. STUPAK. As Chairman Dingell knows and other members 

know, the record would stay open for 10 days for additional questions. So we will make sure that is done. 

Mr. DINGELL. Thank you, Mr. Chairman, and thank you, Mr. 

Secretary. It is a pleasure to have you before the committee. 

Mr. STUPAK. Thank you, Mr. Dingell. Mr. Shimkus for questions, 

please. 

Mr. SHIMKUS. Thank you, Mr. Chairman, and I, too, would like 

to submit for the record for you, Mr. Secretary, if you would supply 

the committee’s staff with all risk analysis of another blowout that 

was used in determining the first moratorium and then obviously 

the second. There has got to be some risk analysis that was conducted, and we would like for you to submit that for the record. 

First of all, I want to thank you for being here, and I appreciate 

your candor to say, hey, there is enough blame to go around for all 

of us. I think the deep-sea modeling issue is just another one that 

a lot of us let slip by, things that we could have done. And so I 

think that is important that we look at the problem, try to resolve 

the problem, make BP pay and move forward. 

This is historical in my 14 years having a sitting Secretary and 

two previous Secretaries in one day, and as I noted earlier, I have 

not seen that ever done. I have not seen a Secretary of Energy 

brought before and then the previous Secretaries of Energy brought 

on the same day. So it is what it is. So we welcome you here. 

First of all, for electricity generation in this country, are we independent? Are we as a Nation for the most part independent on our 

energy needs for electricity generation? I can help you. I know you 

are not in the energy—the answer is yes. So when we talk about 

energy needs of this country, I like to break it up into electricity 

generation and liquid fuels for transportation needs and the like. 

You made a comment in your opening statement about the huge 

amounts of energy that will be able to be recovered by wind in the 

Atlantic coast. Can you define huge for me? This has got to be electricity generation because we don’t make transportation fuel out of 

wind. I am just trying to figure out what huge is. 

Secretary SALAZAR. The formal evaluation as I recall from the 

National Renewable Energy Lab is that there is about 1,000 

megawatts of power available. Now, there is a—— 

Mr. SHIMKUS. But that is intermittent, right? You can’t totally 

rely on that for base-load generation. 

Secretary SALAZAR. Let me, Congressman, answer your question. 

There is a connect between how we use electricity and how we consume oil, and this President has been working for a long time—— 

Mr. SHIMKUS. OK, reclaiming my time. I really am short, and I 

want to stay true to the 5 minutes. 


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Secretary SALAZAR. Let me make my point. I want to make my 

point. 

Mr. SHIMKUS. Let me just say that—— 

Secretary SALAZAR. Chairman, I would just like to make my 

point, to answer my—— 

Mr. STUPAK. Would you let him answer and then we will—— 

Mr. SHIMKUS. No, I have like three more questions I need to go 

to, so I get the point. My point is there is electricity and liquid fuel. 

It is my time—— 

Secretary SALAZAR. I can answer my question in two words, electricity and transportation are tied together. 

Mr. SHIMKUS. Maybe in the new world, but it isn’t today. I will 

tell you what real power is, 1600 megawatts by a coal-fired power 

plant being built. That is the equivalent of 624 wind generators. 

The 624 wind generators would take 30,000 acres of land to place. 

We just got to keep this—there is not huge. Huge is nuclear. Huge 

is coal. Renewable is helpful, but to sell the story that it is the salvation of our energy need is really doing a great disservice to this 

country. 

Let me move onto the moratorium. There are 33 rigs idle right 

now. If I said that that is 45,000 jobs and equivalent jobs, would 

that be close? 

Secretary SALAZAR. There have been different numbers that I 

have seen from experts. 

Mr. SHIMKUS. 30,000? 

Secretary SALAZAR. There are thousands of jobs. 

Mr. SHIMKUS. If I said a loss of $330 million in payroll, would 

that be close? 

Secretary SALAZAR. I haven’t seen the number in dollars. 

Mr. SHIMKUS. Two billion dollars in royalties to the Federal 

Treasury is lost. Would that be close? 

Secretary SALAZAR. There is no doubt the moratorium has an 

economic impact. 

Mr. SHIMKUS. OK, the last question. I do—but this moratorium 

is killing me and it is killing jobs in a place that needs jobs. When 

you put your hand on the pause button, is business planning and 

decision making pausing? I will give you an example. In my opening statement, I talked about a release yesterday. First rig sails 

away over drilling ban. Diamond Offshore announced Friday that 

its Ocean Endeavor drilling rig will leave the Gulf of Mexico and 

move to Egyptian waters immediately, making it the first to abandon the United States in the wake of BP oil spill and a ban on 

deep-water drilling. That is in the time when we need jobs and the 

economy and energy is important, we pray that you have some concern about the jobs of this country and of Louisiana. 

Thank you, Mr. Chairman. I yield back. 

Secretary SALAZAR. Congressman, if I may? Mr. Chairman, I 

would like to just respond very briefly—— 

Mr. STUPAK. Yes. 

Secretary SALAZAR [continuing]. In this sense. First, we are 

aware of the economic impacts of the moratorium. We also believe 

that it would be irresponsible to take our hand off the pause button 

given the current circumstances. Second of all, with respect to electricity, we do believe that the future of it is huge and it is going 


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to be part of the future energy portfolio of the United States. So 

I respectfully disagree with you, Congressman. 

Mr. STUPAK. Mr. Green for questions. 

Mr. GREEN. Thank you, Mr. Chairman. Thank you, Mr. Secretary 

for being here, and I am going to ask my staff—I talked with you 

earlier about a letter the Congressman Kevin Brady and I sent in 

on June 24 that a number of our colleagues signed onto outlining 

hopefully an interim solution to lift the deep-water drilling ban on 

a small scale, and like my colleagues, I represent a very urban district in Houston. It has refineries, chemical plants. We do everything energy including—I have constituents who work offshore and 

historically families who have worked offshore. So the moratorium 

is a very big issue. 

The letter we are asking about that several of my colleagues propose lying low-risk development and appraisal wells to be drilled 

while the Department of Interior continues the assessment on 

deep-water exploratory wells. These type of wells offer the reassurance of smaller, minimal risk because of delineation and sidetrack 

drilling that accompanies these wells merely just serves to define 

the parameters of then-known reservoir. If your department agreed 

to this modification—hopefully it is under consideration for almost 

the last month. If it addressed the Administration’s call for safe 

and secure drilling and protect estimated about 75 percent of those 

jobs you heard earlier that would be lost under the moratorium if 

we go forward with the full 6 months. And it would also help prevent future energy supply shortages in 2011 and 2012 because 

these wells don’t come in immediately, particular deep water. It 

takes a long effort to get there. 

Now, the new moratorium focuses on drilling configurations and 

technology rather than drilling depth, and since the whole basis of 

my proposal stems from the specific drilling configurations and assuming we quickly get the blowout preventer and rig equipment inspected by Interior and third-party certifier, would that prevent 

you from exempting these wells from the moratorium? And again, 

these are not actually production wells, these are actually just delineating the reservoir and are much less riskier than the Horizon. 

So I know you have a copy of the letter now, and we sent it like 

I said on June the 24th, but I appreciate you seriously and the Interior seeing if we can moderate that 6 months where we can get 

75 percent of these folks actually back working. That way we 

wouldn’t have these rigs sailing off to somewhere else. 

And I would just appreciate it if you would just say you will consider it. That is fine with me, and we will be back in touch because 

you have been real great with your time with a lot of us over the 

last 2 months trying to work with you and Interior. 

Secretary SALAZAR. If I may, Congressman, the key issues that 

we are looking at that we need to have some satisfaction with are 

drilling safety, blowout containment and oil spill response. And Michael Bromwich, the Director of the Bureau of Ocean Energy, has 

already publicized the schedule of meetings that he is going to 

have, especially in the Gulf Coast states, developing additional information. And then maybe the moratorium could be adjusted 

based on zones of risk. We already have said that it is OK to move 

forward with drilling in the shallow waters, OK? We have said that 


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there may be a possibility of doing something that distinguishes between wells that are being built off production platforms versus 

wells that are being drilled as exploration wells. We don’t know 

anything at all about those formations or insufficient information. 

So that is part of the analysis that we currently have under way, 

and we would be and will keep you informed as we move forward 

with that analysis. 

Mr. GREEN. And that is what our letter asks for, those less 

riskier wells where we could get those folks back to work and delineate the reservoirs. Again, the taxpayers would benefit, obviously 

my constituents and people who work there. 

My second question is, and you mentioned shallow well drilling, 

I appreciated the first production well was actually, a permit was 

given last week. And you know, my concern, there has been a de 

facto moratorium on shallow well drilling. There have been reworking and things like that, permits given on shallow well drilling, but 

like I said, the first actual production well was issued last week. 

And from what I understand from today’s Wall Street Journal, that 

company actually started drilling Sunday because there was such 

a demand in shallow water. 

We have also sent an earlier letter to you at the end of May from 

Congressman Boustany and I that we appreciate the lifting of the 

shallow water but like I said, the first new well permit was issued 

last week. In fact, I was told yesterday, several of our shallow 

water producers met with Mr. Bromwich’s staff yesterday, and they 

are close in agreement on some of the guidance in NTL06 because 

that is some of the concern. We are having—field offices don’t know 

what NTL06 and they are not issuing those permits, and as soon 

as possible if we could get the rules there because these are shallow water wells. All the equipment is up on top. If you have a question about the blowout preventer, it is not 5,000 feet below sea 

level. And there are a great deal of natural gas that is produced 

and jobs created from those shallow water wells. 

So I appreciate. Hopefully that one permit that was issued last 

week for production will see more issued in the next few days. So 

that will show that there is not a de facto moratorium on shallow 

well-drilling. 

Mr. Chairman, I appreciate your patience. 

Mr. STUPAK. Thank you, Mr. Green. Mr. Griffith for questions. 

Mr. GRIFFITH. Thank you, Mr. Chairman. I am listening intently 

to the testimony, and it is obvious that we all crave certainty in 

our lives, and therefore we want to measure and measure everything. 

I think that in my particular case, I am not so much interested 

in the technical aspects of the well head of what have you, but I 

do know that the capping of the well was low tech. I do know that 

this was not a difficult concept of putting a cap on top of where the 

oil was coming out of, but I do know that it took a good long while. 

And I do know that we will fool ourselves into some degree of confidence that we are doing the job when we measure and continue 

to measure. And I know we will generate a huge booklet of regulations, but I will remind all of us that if I step on the bathroom 

scales and it looks at 200 pounds, I get off of that bathroom scale 

and I put a cotton ball on, the needle doesn’t move. Whatever we 


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are measuring has a finite amount of confidence to it. So what I 

am concerned about is that we are going to have a blowout again, 

as diligent as we are today and as many of the things that we 

would like to measure, but we do know that the thermal dynamics 

and the external variables, the internal variables almost make 

deep-water drilling a biologic system. And we know that a human 

can die with a normal blood work and a normal EKG and a normal 

MRI and a normal CT scan, so we are going to have this event once 

again in front of us, regardless of our intentions. 

And so my concern is from the time that well blew out to the 

time we put a cork in the bottle, so to speak, what happened? And 

my other question is this. Should that have happened when your 

position was empty, should that have happened in between administrations or in between Secretary of the Interior, who takes 

charge? It reminds me of the story of the nurse that goes down to 

the nurse’s station and says, Mr. Jones is blue. The nurse takes the 

chart out and says, what room is he in, and she duly charts it and 

then says what do you think we should do? Let us call his doctor. 

It looks like he might need some oxygen. We can’t give it to him 

without an order. His doctor is not on call. Do you think it is his 

heart or is this a lung doctor we should call? Well, by the time we 

get there, well, he is not blue anymore, he has got a tag on his toe, 

and he is on the way downstairs. 

So what we saw here was a cost guard, an EPA, Environmental 

Protection Agency. We saw the mayors and governors all weighing 

in, and it appeared that there was no central control immediately 

of the situation. So after we create the documents, and this happens again. Who can you point to, and not you but generic who 

says this is the guy that takes care of the oil well problem? This 

is the guy that takes care of the earthquake problem. This is the 

guy that takes care of the tsunami problem. This is the guy that 

takes care of the hurricane problem, because we have done this before in America, whether it be Katrina, the Colombia accident or 

what have you. We are having trouble going from a tremendous 

amount of knowledge to executing it in the field, and I think that 

should be part of our response and solution. I would like to hear 

your thought on that. 

Secretary SALAZAR. Well, Congressman Griffith, Admiral Thad 

Allen was appointed as the National Incident Commander. All of 

the United States Government goes through him as he coordinates 

the overall response. Secretary Chu and I have been focused in two 

areas, one is on the source control on the kill of the well, and I 

have been focused as well in terms of protecting the 44 wildlife refuges and national parks and the ecological resources of the Gulf 

Coast. 

Secretary Napolitano obviously overseeing the Coast Guard and 

being under the Presidential directives, the personal role and 

charge of the oil spill response. 

So the Federal Government from day one has been very—— 

Mr. GRIFFITH. Well, my question is simply this, can we make 

that more efficient? Could we say this is a catastrophe and we are 

on it from day one or two or three? In other words, can we reduce 

that timeline because capping that well was probably not a novel 


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light bulb going on in some engineer’s brain. It probably, had they 

put their—— 

Mr. STUPAK. The gentleman’s time is—— 

Mr. GRIFFITH [continuing]. They may have been able to not have 

done it quicker. 

Mr. STUPAK. If you can answer, Mr. Secretary? 

Secretary SALAZAR. I will say that I think from day one—I sent 

my deputy without overnight clothes on April 21st to New Orleans 

along with Kendra Barkhoff who was here who began to monitor 

the situation, and quickly we were in communication with Secretary Napolitano and the White House and everybody else. We 

have been on it since day one. 

I do believe, Congressman Griffith, that when one looks back as 

one should in any post-mortem, there will be an opportunity to see 

how things might have been improved. That is just the nature of 

how these things go. We are dealing with what is an unprecedented and largest oil spill response in the history of this country, 

and the resources that have been spent have been enormous, and 

the mobilization of the United States Government has been at the 

direction of the President relentless and with his specific direction 

that we will not rest until we get this problem solved. 

Mr. GRIFFITH. I appreciate you and your staff—I don’t like the 

moratorium a bit, but I am sure if I could—— 

Mr. STUPAK. OK, Mr. Griffith, your time is up, please. 

Mr. GRIFFITH. Thank you. 

Mr. STUPAK. Let us go to the next questioner, Ms. Capps, for 

questions, please. 

Mrs. CAPPS. Thank you, Mr. Secretary, for being here with us. 

During the previous testimony today by your predecessors, 

strong comparisons were made between the Deepwater Horizon oil 

spill and Hurricane Katrina. It was striking to me that what was 

not mentioned was one very striking difference. The hurricane 

which occurred 5 years ago was watched by the entire country as 

it approached land and wreaked havoc, you know, for 2 full days 

and then it was gone. But with the exception of the initial deadly 

explosion, the extent of the oil spill was unknown. It occurred a 

mile below the surface of this gulf, and the perpetrator of the blowout, BP, withheld so much information, videos, and reports for days 

and weeks. 

We in the government, and more importantly, the American people, were lied to. Precious response time was wasted, let alone any 

requirement to have response equipment already in place and 

ready to go on day 1. Now it is day 90, and you and your team 

have been in full response mode, but you also have been learning 

a great deal. I want to let you talk or ask you to talk, please, and 

respond for a minute or so, fairly briefly. I want to follow it up with 

another similar kind of question to look where we have come from, 

but also on your watch, where we should go from here. 

Secretary SALAZAR. Well, it seems to me and I appreciate the 

question, Congresswoman Capps, I think when you look at it back 

from a global perspective that we are looking at what the President 

has been pushing, and many of you have been supportive, which 

is a comprehensive energy program for this Nation, and in that 

comprehensive energy many of you are supportive of the renewable 


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part of the portfolio. Some of you are more supportive of the oil and 

gas part of the portfolio, but we all recognize and the President recognizes that oil and gas will be part of that portfolio during this 

transition time. 

The question then for all of us as the United States becomes how 

can we make sure that oil and gas as it is produced is being produced in a way that is safe and protects the environment. And to 

me, Congresswoman Capps, the central questions come down to 

these three. 

First, can we assure the American public that drilling can continue in a safe way? Your prevention bill that you passed is part 

of that answer. 

Secondly, if you do have a blowout, what are the oil containment 

programs in place to be able to deal with a blowout. They obviously 

were not in place to deal with this issue that now is in its 90th 

day. 

And then thirdly, what are the adequate oil spill response capacities that are needed to be able to deal with an oil spill response 

if one should ever occur again. When we have answers to those 

questions, it seems to me then we are able to move forward. 

Mrs. CAPPS. Thank you. I have to say in your position as Secretary from my perspective as a coastal representative I very much 

appreciate your decision to shelve the Bush Plan to open up much 

of the California coast to oil and gas leaking—leasing. 

It was referenced, though, today already that the development of 

the previous Administration’s offshore energy program plan appeared to be driven more by energy companies than by public input 

or the best available science. In contrast to this kind of closed-door 

process employed by the previous Administration, it appears to me 

that your decisions are being informed by public input and incorporating the best available science. 

I salute the listening sessions that you held right as soon as you 

were sworn into office, long before this event ever occurred, and I 

was fortunate to be part of one of them, and I noticed that Director 

Bromwich announced yesterday that there will be additional public 

hearings coming up in the next few months to inform the leasing 

decisions that you will then be making. This accompanied with 

some of the science. 

So this is what I would like you to spend the rest of the time 

on if you would, how do you intend to use this decision, this gathering of information in your decision-making process? 

Secretary SALAZAR. Congresswoman Capps, the—we will use the 

information that we collect from the Bromwich set of hearings to 

move forward in consideration of the three central questions that 

I outlined previously, all of which related to the moratorium and 

to the ultimate goal here, which is to develop a safe and protective 

oil and gas production program. 

You are correct that when I took office on January the 21st I had 

in front of me a new 5-year plan that was to go into effect in 60 

days that essentially opened up all of the waters of the United 

States. I decided 60 days was insufficient for public comment and 

extended it to 180 days and had the hearings which you participated in in California, Alaska, and other places. 


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And it is our view, it is the President’s strong view that the decisions are best made when they are transparent and when we are 

maximizing public input. 

Mrs. CAPPS. Thank you, Mr. Chairman. 

Mr. STUPAK. Thank you. Mr. Latta for questions, please. Five 

minutes. 

Mr. LATTA. Well, thank you very much, Mr. Chairman, and Mr. 

Secretary, thank you for joining us today. Really appreciate your 

time here. 

I read with interest in your conclusion that you have talked 

about a little bit already, but I would like to also just read. It says, 

‘‘Much of my time as Secretary of the Interior has been spent working to reform old practices of the MMS and 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 the future. Our efforts to develop a robust OCS renewable energy program are a 

major part of the effort to find that balance and help us move our 

Nation toward a clean energy future.’’ 

Then you also go on to state that, you know, for now we have 

to look at conventional oil and gas. 

You know, it is interesting that we are here today because I am 

not sure, you probably did see the front page of the ‘‘Wall Street 

Journal’’ today. ‘‘China Tops U.S. in Energy,’’ and I would just like 

to read just a little bit from this. 

‘‘China has passed the U.S. to become the world’s biggest energy 

consumer according to the new data from the International Energy 

Agency, a milestone that reflects both China’s decades-long burst 

of economic growth and its rapidly-expanding clout as an 

investorial giant. China’s ascent marks a new age,’’ it says here, ‘‘in 

the history of energy.’’ 

Then it goes on—I think it is also interesting a little bit farther 

in the article it says, ‘‘China overtook it,’’ meaning the United 

States, it says here a little earlier that the Untied States was the 

largest energy user since the early 1900s in the world. ‘‘China overtook it at break-neck pace. China’s total of the energy consumption 

was just half that of the U.S. 10 years ago, but in many of those 

years since China has—China saw annual double-digit growth 

rates. It has been expected to pass the U.S. about 5 years from now 

but took that to position today.’’ 

The reason I read that is because I represent the largest manufacturing district in the State of Ohio, and I also represent the 

largest ag district in the State of Ohio. My district, if we are going 

to survive and according to the National Manufacturers, I, 2 years 

ago, represented the ninth largest manufacturing district in the 

Nation, and because of where we are with the economy, we are 

20th now. 

But, you know, my main concern is what Mr. Shimkus brought 

up. We have to have base-load capacity in this country, and I am 

all for an all-invoked strategy, and that all-invoked strategy has always been we need nuclear gas, oil, clean coal, wind, solar, ethanol, 

biodiesel, hydrogen, and right down the line. 


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But for the factories in my district to operate, we have got to 

have power that turns on immediately, or we are not going to have 

people working, and the biggest problem in our area, we are just 

talking about one thing, jobs, jobs, jobs, and when folks look 

around and they ask me, how come the jobs are leaving the United 

States, well, and then I am looking at this article and I can point 

to one more thing that is killing is that, you know, the energy 

needs in this country might be—are being shipped someplace else 

means they are going to be—their manufacturing is topping ours. 

The Chinese want to be, you know, atop us in manufacturing. In 

10 years if they are able to do in energy, they might do to us in 

manufacturing. This is getting scary. 

And it is also, it is kind of odd right on top of this there is another story in the ‘‘Journal’’ today. It says, ‘‘Personal Journal, How 

to Tame your Nightmares.’’ Well, this is my nightmare right here, 

and you know, I am really concerned that as we—as the Administration goes forward and that we get—30 percent of our U.S. oil 

comes from the Gulf, that as you said in your statement on page 

10 here that, you know, you—that you will continue to look at this 

conventional oil and gas playing a significant role in our economy 

and not selling it short because we have got to have it to survive 

as a manufacturing country. 

And I will leave the rest of my time for an answer. Thank you. 

Secretary SALAZAR. Thank you, Congressman Latta. As I have 

said in previous testimony, we—the President from day 1 has said 

we need to have a comprehensive energy plan, and our view is part 

of the reason the United States will fall into second place is if we 

are not able to get a comprehensive energy plan adopted for the 

United States of America, and hopefully there is still time in this 

Congress to be able to do that because once the right signals are 

sent to the market, essentially what you are going to have is a different kind of headline than the one that you were showing me 

from the ‘‘Wall Street Journal.’’ 

And that is that we as a United States are not playing for second 

place. We are playing for first place as the President has said, but 

in order to do that we need to have the long-range policies in place 

to bring up as many of you support nuclear, as many of you support clean coal, as many of you support wind and solar and geothermal, but we need to have a framework that isn’t the start and 

stop of energy policy which we in this country have now had for 

the last 30 years. 

Mr. LATTA. Well, thank you very much, Mr. Chairman. I yield 

back. 

Mr. STUPAK. Thanks, Mr. Latta. 

Mr. Melancon, questions, please. 

Mr. MELANCON. Thank you, Mr. Chairman. I appreciate it. 

Secretary Salazar, I would like to kind of follow up on something 

that Mr. Dingell was inquiring about. It is my understanding that 

there is a requirement of a 30-day EIS completion for these deepwater well, and if it can’t be completed in 30 days, then, in fact, 

they can waive—the department, MMS, can waive that requirement. Is that—— 

Secretary SALAZAR. The issue on the categorical exclusions is 

that you cannot do, frankly, an environmental impact statement in 


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the 30 days, and so what has happened is that categorical exclusions have been given in the past under Republican and Democratic Administrations with respect to exploration plans as happened here in the—— 

Mr. MELANCON. Do you have or does your staff know when that 

categorical exemption was put into effect either by law, or was it 

put in effect by rule within the Department? 

Secretary SALAZAR. I can get that information for you, Congressman Melancon. I don’t have that at the top of my head right now. 

Mr. MELANCON. Is this same waiver applicable in all of the Gulf 

Coast States, or is it only applicable in certain States? 

Secretary SALAZAR. My understanding, Congressman, is that 

there have been several hundred of them that actually had been 

given and probably it would not be done on a jurisdictional basis 

off any one of the States. And so the reality is that the categorical 

exclusions are driven in large part because under the current law 

relating to OXA there is a 30-day requirement to approve an expiration plan once it is filed with the Department. And so that is not 

sufficient time to do the right kind of environmental review and 

is—it is the reason why in the President’s submission of a legislative package to Congress he said that requirement of the law 

should be changed to 90 days. 

Mr. MELANCON. If you would and if you would just—this could 

be responded to, the reason I asked that question is I have been 

told, and I don’t know that this is valid or not, that Louisiana, 

Texas—I mean, Louisiana, Mississippi, and Alabama, the 30-day 

requirement with the waiver, if it can’t be done in 30 days, was applicable, but the other two Gulf States they had to do the IS regardless. Don’t know that for a fact, but if your Department can 

verify. 

Secretary SALAZAR. We will check on that and get back to you 

on that. 

Mr. MELANCON. We have had as you know and you and I have 

gone back and forth, and I appreciate your efforts to stay in contact 

with me. You have been better than me at returning calls back to 

you, but the moratorium is more concern and I guess the concern 

I have got is, one, is the Commission that was set up, they have 

any charge whatsoever about making recommendations as to 

whether the Administration stays with the moratorium, or if they 

have some findings, or are they charged with looking for findings 

to bring back to the Administration and to you to say this moratorium maybe isn’t good, the economic hardship or impact would be 

worse than trying to find some method or way of doing the rolling 

inspections as we have talked about in the past. 

Secretary SALAZAR. Congressman, the President’s Deepwater Horizon Commission has as its mission to get to the bottom of the 

story as to what happened with respect to the blot at the Macondo 

Well and the Deepwater Horizon, and they will undertake that effort as they have already started. We will be informed by their proceedings and information as they develop and recommendations 

that they make. So we will be in contact with them as we develop 

our own information and move forward with our process on addressing the issue of the moratorium. 


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Mr. MELANCON. Can you give me, if it is possible, what was the 

thought processing, I mean, was it just strictly the concern with 

another blowout as opposed to a moratorium, or was there any discussions about finding something as I have described that would 

work for inspections and safety that was somewhere between drill, 

baby, drill and shutting it completely down? 

Was there any discussion there, or did it just go straight to we 

have got to shut this down and try and find out—make sure that 

we don’t have another blowout and let us not worry about the economy? What transpired in those conversations? Do you recall? 

Secretary SALAZAR. Congressman, those issues were, in fact, 

looked at and considered, and they are part of the record and part 

of our decision on the moratorium. I will say this, that as I am here 

in front of this committee today, we are still in a very dynamic and 

a very dangerous situation. We are not out of the woods even 

though this well has been temporarily shut in because until we get 

to the ultimate kill of the well, the situation is still a very dangerous one. And it is our view and I have worked on this from April 

20 forward, that until we have the answers to the fundamental 

questions that I outlined to the committee earlier on, that it would 

be imprudent for us and irresponsible to move forward and lift the 

moratorium. 

Now, as information develops and as we move forward with our 

review and as Director Bromwich holds his hearings, too, which I 

think are scheduled for Louisiana, that we will have an additional 

set of information that might allow us to adjust the moratorium at 

some point, but right now looking at the timeframe, our view is 

that November 30 is a reasonable timeframe when we can expect 

to be able to make some decisions on the moratorium. 

Mr. MELANCON. Thank you, Mr. Secretary. 

Thank you, Mr. Chairman. 

Mr. STUPAK. Thank you, Mr. Melancon. 

Mr. Shadegg for questions, please. 

Mr. SHADEGG. Thank you, Mr. Chairman, and Mr. Secretary, I 

want to commend you as did my colleague, Mr. Shimkus. I listened 

very carefully to your opening statement, and it is not often that 

in this town anybody comes forward and acknowledges, look, we 

could have done things better. In your opening statement you said 

that past Administrations and this Administration had not done as 

much as they could have done to ensure the safety of this industry 

or to ensure the safety and ecological protection necessary for this 

kind of activity, and I appreciate the candor of that statement. 

You also went on to say, and I appreciated it, that with 40 years 

of drilling history and there being no incidents, I believe your 

words were, this Administration and prior Administrations had 

been lulled into a sense of complacency, and I think that is a fair 

assessment. I don’t know how much of this hearing you have been 

able to watch, but in the appearance of your two predecessors during the early hours of this hearing, that was not the kind of testimony that was going on. Rather there was a blame game being 

played very aggressively by some members of the committee trying 

to assign blame and trying to point fingers. I don’t really think that 

solves the problem. I think it is more important to look at what 


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went wrong but more important to live our lives looking forward 

at what we can do correctly in the future. 

In that regard, I believe the report that you received on May 27 

contained language to the effect that the industry had had over 

50,000 wells in the U.S. outer-continental shelf, of which more than 

2,000 were in waters 1,000 feet deep or more, 700 were in waters 

5,000 deep, that we had been using sub-sea below preventers since 

the mid 1960s and that the only major prior event from offshore 

drilling had been 41 years ago, and that, in fact, had been from 

the—in the Santa Barbara Channel, and it had been from a shallow water platform where the blowout preventer was on the surface. 

I assume that is what you were referring to when you were talking about the history of this industry led us to using the procedures 

we were using prior to this incident. Is that correct? 

Secretary SALAZAR. Congressman, what I would say is that 41 

years of a relatively good record essentially led the United States 

Congress and many Administrations to essentially assume that 

there was safety with respect to this kind of drilling. 

Mr. SHADEGG. Mr. Kempthorne said just about, and he also 

noted that we would never do it again because we have learned 

from this incident. 

Secretary SALAZAR. But the fact is that that assumption was 

made, and we do have an ongoing disaster in the Gulf of Mexico, 

and I think from our point of view would be imprudent for us to 

simply move on as if nothing had happened. 

Mr. SHADEGG. I couldn’t agree—— 

Secretary SALAZAR. At the end of the day where you were is 

where the President and I have been from day 1 on this. We have 

a problem, and we have to fix it, and we have to fix it right. 

Mr. SHADEGG. I couldn’t agree more. My time is short, so I want 

to get to all these questions. 

Mr. Waxman in his questioning talked about several issues. He 

mentioned that there are regulations on—you mentioned in response to his question that there are regulations on casing and cementing and mud and all of those issues and that a part of your 

study now is to find out were those regulations filed, followed, or 

were they broken, and that is a part of the forensic activity. 

Wouldn’t you agree that it would be prudent before this Congress 

enacts permanent legislation, at least legislation specifying details 

in that nature as opposed to granting new regulatory authority, 

that we get the answers to those questions before we enact legislation? 

Secretary SALAZAR. I think we have already learned a great deal 

from this ongoing disaster in the Gulf that provides a basis for 

which to act. Now, that does not mean that as we go forward and 

the President’s Deepwater Horizon—— 

Mr. SHADEGG. We don’t—by your own testimony we don’t know 

the answer to those details. Correct? We don’t know exactly what 

went wrong here. You said earlier we can’t get to those things because we are too busy trying to cap the wells, stop the flow. We 

haven’t been able to do the forensics yet. Correct? 

Secretary SALAZAR. We know a lot. We don’t know everything 

yet. 


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Mr. SHADEGG. Great. You said in response to Mr. Shimkus’s 

question that huge was 1,000 megawatts. Then he cut you off. Did 

you really mean huge means 1,000 megawatts, or is that huge compared to what we thought wind could do prior to this? 

Secretary SALAZAR. It was 1,000 gigawatts. 

Mr. SHADEGG. Oh. You said megawatts, and that is quite a bit 

of difference. OK. 

Secretary SALAZAR. If I said that, I apologize. I meant to say the 

National Renewable Energy Labs calculation of the potential for 

offshore wind is at about 1,000 megawatts, but the states along the 

Atlantic—— 

Mr. SHADEGG. I don’t want to be rude. I want to get into this last 

question, and my time is extremely short. Gigawatts is very different than megawatts. You may have—you just misspoke, and it 

just stunned some of us back here. 

You are aware of the e-mail that was sent by the eight scientists 

who disagreed with your characterization of their report and were 

quite angry that it had been changed after they signed off on it and 

before they submitted it. The original report said that the moratorium should last for a sufficient—and I am quoting here. ‘‘For a 

sufficient length of time to perform additional,’’ and then they talk 

about blowout preventer testing, pressure testing, and water barrier testing. It then is changed by your Department to say a 6- 

month period. 

Is it routine for the Department to change reports after the fact, 

and I note that today, and I am going to run out of time here, I 

note that today you said—— 

Mr. STUPAK. You are out of time. 

Mr. SHADEGG. I am out of time? I note that today that you said 

that the recurrent moratorium will remain in effect until November 

30 or until those three questions you posed are answered. I am a 

little confused as to what the line of the—the length of the current 

moratorium is, and I would concur with some of the members here 

who hope that you will release that moratorium as soon as it is 

safe to do and that you would focus on bad actors as opposed to 

punishing anybody that is out there doing a good job. 

Secretary SALAZAR. If I may, Mr. Chairman. 

Mr. STUPAK. Yes. 

Secretary SALAZAR. Just responding to the two questions. 

In terms of the engineering reports, the fact is that the report 

to the President was my report, and I appreciated the input from 

the engineers and any others who were involved in helping us 

write the report, but the decision on the moratorium essentially 

was my decision as Secretary of the Interior. It wasn’t the decision 

of engineers or anybody else. 

I think I have covered it. 

Mr. SHADEGG. Thank you. 

Mr. STUPAK. Mr. Gonzalez for questions, please. 

Mr. GONZALEZ. Thank you, Mr. Chairman. Welcome, Mr. Secretary. 

On the moratorium, I share some of the same concerns as others, 

and when we have the other witnesses, Mr. Secretary, I also expressed that I wasn’t in total agreement with what—the policies 


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that have instituted this place, and I think Mr. Green probably articulated many of my own concerns. 

Until we find out, and I think Mr. Shadegg has a good point, 

until we find out what went wrong at Deepwater Horizon, how are 

you going to proceed with remedying that situation if we really 

don’t know? Now, some people say it may have just been a deviation from what is accepted industry standards, and I don’t know 

all of the terms, all—we are not going to be experts in this, but the 

casings and the cement and so on, in capping the well. 

And let us just for the sake of argument say that is what we find 

out. We find out whoever was responsible for that didn’t do that 

particular process correctly, and according to everybody else in the 

industry they would have never done it in the manner in which it 

was done. That is the assumption that they are making when we 

have had them here as witnesses. 

How does that play into what you are going to do with the moratorium, because this could be an open-ended question for 4 months, 

5 months, 6 months. I mean, I am not sure when we finally arrive 

at answers. 

Secretary SALAZAR. Let me say there are many questions, and 

one of them has to do with drilling safety, but there are many others that are obvious such as the oil spill response plans and the 

capability. 

I think it is fair to say that the oil spill response plans that have 

been in place are inadequate, and so how we deal with that issue 

is something that we can start working right away, and waiting 

until we have the reports from the Commissions and the other investigations isn’t the way that we want to do business. 

We want to move forward as quickly as we can for respective 

blowout containment measures, which is another set of issues, 

what you probably have here at the Macondo Well is the greatest 

laboratory in the history of the world relative to what you do on 

containment, because it has been a learning process. Many failures 

but many lessons that have been learned, and so creating this kind 

of containment capacity in the Gulf of Mexico may be one of those 

outcomes that we want to latch onto and not wait around for another 6 months before we start developing that kind of an effort. 

So I think for those of you who are concerned about the moratorium and its length, you should be supportive of the kind of effort 

that we are undertaking to try to move forward to create the goal 

of safety and protection for the environment with respect to oil and 

gas drilling. 

Mr. GONZALEZ. And I think we all share the same goals. We just 

believe one on expediency, of course, being thorough, and the fact 

that you can treat different wells that are in different phases or 

stages of development differently so that there is not so much catch 

up when you finally lift it in part or in whole. 

Now, you had a Federal District Court basically join you. Is that 

correct? 

Secretary SALAZAR. That is correct. 

Mr. GONZALEZ. And then you issued a new moratorium that 

would be—obviously have something different for the Court to consider the next go round. Is that correct? 


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Secretary SALAZAR. It is a new decision with significant additional information and we believe a very good record. We believe 

the first one was a very good decision as well and is legally defensible. Much happened between the first decision and the second decision in terms of additional information. 

Mr. GONZALEZ. So you were responsive to some of the Judge’s 

concerns? 

Secretary SALAZAR. Yes. 

Mr. GONZALEZ. Thank you. I have got about a minute, but I want 

to give you a chance to respond to what was stated earlier by 

former Secretary Kempthorne. He made a general statement that 

in his opinion and what he read, even though he has not been privy 

to any meetings by any of the stakeholders or participants, that he 

sensed, one, this Administration didn’t make use of all assets that 

were available. Number two, that he did not see that the Administration was truly engaged and maybe there was non-engagement, 

and thirdly, that he didn’t see the Administration creating an environment which was conducive to cooperation among all of the different individuals at the local and state level. 

Twenty-seven seconds if you can give me the Administration’s response. 

Secretary SALAZAR. Thank you, Congressman Gonzalez. Let me— 

I have great respect for Secretary Kempthorne, but let me say that 

I very much disagree with those conclusions. Within days after this 

disaster started unfolding, I was actually in a meeting in Louisiana 

with Secretary Napolitano, Director Browner, and others with Secretary Gates on the phone, authorizing these States to move forward with the National Guard and yet very few of the States has 

really brought up the National Guard to the level that they could 

have brought it up. 

But that was done within days of the onset of this disaster. I will 

tell you knowing and working with my colleagues on this Cabinet 

and the White House every day, including sometimes at eleven 

o’clock at night like we were last night and sometimes at 2:00 in 

the morning, that we have not rested, and we have been relentless 

in terms of our effort to deal with this problem, and we are confident that we are going to deal with this problem, and we are 

going to have some fixes here that are good for the United States 

of America. 

Mr. GONZALEZ. Thank you very much, Mr. Secretary. 

Mr. MARKEY [presiding]. The gentleman’s time has expired. 

The Chair recognizes the gentleman from Louisiana, Mr. Scalise. 

Mr. SCALISE. Thank you, Mr. Chairman. 

Mr. Secretary, on the Commission that the President put together that is currently conducting hearings, I know I testified before them last Monday along with Senator Landrieu, and one of the 

points we were bringing up was about the moratorium, and pretty 

quickly into that conversation, this was our first day meeting, they 

said that they were not tasked with addressing the moratorium, 

and Senator Landrieu had presented some letter that you had written where you had indicated that their recommendations on the 

moratorium were going to be one of the factors that you did consider. 


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So I am trying to find out what is the—is there a gap? Were they 

not aware that this was a role they were supposed to play? Is that 

a role that they are supposed to play? 

Secretary SALAZAR. Our position—the moratorium is my decision 

as Secretary of Interior. We will be informed relative to the central 

issues of that moratorium based on the findings from multiple investigations, including—— 

Mr. SCALISE. Will that Commission be part of that decision-making process when you—— 

Secretary SALAZAR. We will consult with them. 

Mr. SCALISE. So—— 

Secretary SALAZAR. We will consult with them. 

Mr. SCALISE [continuing]. They will in essence be tasked as part 

of their task with addressing the moratorium or at least making 

recommendations to you? 

Secretary SALAZAR. Congressman Scalise, their mission is to get 

to the bottom of what happened with the Macondo Well in the 

Deepwater Horizon and make sure that there is no stone left 

unturned. 

Mr. SCALISE. Right, but would the moratorium be part of 

that—— 

Secretary SALAZAR. No. 

Mr. SCALISE [continuing]. Broad issue? 

Secretary SALAZAR. No, it won’t. My decision and my authority 

as Secretary of Interior is to move forward with the OCS plan and 

production in the outer-continental shelf and the—— 

Mr. SCALISE. So they will not be making any recommendations 

to you on the moratorium, or you will not be seeking recommendations from them on the moratorium? 

Secretary SALAZAR. We will be working with the Commission and 

certainly with Chairman Reilly and Graham. We have the greatest 

respect for them and certainly we will seek out their thoughts and 

their ideas and whatever information the Commission—— 

Mr. SCALISE. OK. The reason I am asking is this is important 

back home to people that are trying to figure out which way to proceed in trying to put the facts on the table and get people that are 

making decisions to incorporate all of the facts. And so many people went and testified before that Commission with the understanding they would be addressing or at least in some way be 

working with you or talking with you about moratorium decisions, 

and if they are not, then please say so so that people aren’t wasting 

their time back home, but if they are, then that is important to 

know, too, but I don’t see why—— 

Secretary SALAZAR. Congressman Scalise, let me just give you 

where I think the best thing for your constituents and for you as 

well to communicate with, and that is Director Bromwich is holding hearings on these very issues, the three issues that I have outlined before in my testimony, and it will be very useful to hear the 

points of view of people with expertise on drilling safety, on oil 

blowout containment strategies, as well as—— 

Mr. SCALISE. So will Director Bromwich be advising you in any 

way on the moratorium as well? 

Secretary SALAZAR. Yes indeed. 


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Mr. SCALISE. OK. Now, getting specifically to some of the details 

of the moratorium, the 30-day commission that you had put together right after the explosion of the Deepwater Horizon, they did 

come back with some safety recommendations, and then this confusion about the moratorium came about when I think initially you 

had said that they recommended the moratorium, they came back 

and said that is not what they said. In fact, the members of the 

Safety Commission, a majority of them opposed to moratorium and 

laid out some I think important specific points about why the moratorium that you issued would decrease safety in the Gulf, and I 

want to ask you if you have seen their recommendations about that 

and what your thoughts are because when I spoke to some of 

those—and these are people that you picked, scientists, engineers, 

experts in the field. 

They said four basic things. One is a 6-month pause, as it has 

been described, by the end of the 6 months your most experienced, 

your most newest and most technologically advanced rigs will go. 

They will be the first to leave and the last to return, and in some 

cases it would be years because they operate on 3 to 5-year contracts. 

Also, the crew base, the most experienced crew members, people 

who have worked 10, 15, 20 years in the industry, they are not 

going to sit idle for 6 months while their families still have needs. 

They are going to go on and do something else, so you lose them, 

and then in the interim if you are going to be stopping operations, 

there is a higher level of risk with stopping a production so that 

you are bringing in a fact of risk there, and the country’s demand 

for oil hasn’t reduced, so you would then—we will be importing 

more oil and 70 percent of the spills come from importing oil in 

tankers. 

And so with those factors laid out first, do you—have you seen 

those safety concerns that they expressed about your moratorium, 

and do you disagree with them? 

Secretary SALAZAR. Congressman Scalise, let me say that I very 

much appreciate the work of the engineers that gave us input on 

the safety recommendations that went into the 30-day report. At 

the end of the day that was my report, but I understood as well 

that the engineers disagreed with my policy decision, not theirs, on 

the 30-day moratorium. 

I specifically asked them to come into my office, and they did 

come into the Secretary of Interior’s office and gave me a complete 

briefing on their point of view before I issued my new decision. And 

so their point of view was thoughtfully considered, and I look forward to working with them and with others as we move forward 

on the issue. 

I would say this for you, Congressman Scalise, because I know 

how you care so much about the Gulf and the oil industry there, 

and that is that if you look at the President’s position and my position with respect to the Gulf of Mexico and drilling there, we have 

said that oil and gas is part of our energy portfolio. 

So we would ask this Congress to join with us as we move forward to address this issues relating to drilling safety, oil spill response, and blowout containment because the sooner that we can 


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address those issues the easier it is going to be for us to move our 

hand off the pause button. 

Mr. ENGEL [presiding]. The gentleman’s time has expired. 

Mr. SCALISE. Thank you. I yield back. 

Mr. ENGEL. I yield myself 5 minutes. 

Mr. Secretary, welcome back to the Hill. I want you to know that 

we are taking good care of your brother, so you have nothing to 

worry about. 

Secretary SALAZAR. Thank you. 

Mr. ENGEL. You have a very difficult job obviously, but I believe 

you are the right man for the job, and I think that we are all with 

you on every move you make, because this is something that nobody could have expected. 

I have sat through all the hearings that we have had in this committee, and one of the hearings we had the chief executives from 

all the other major oil companies, not BP but Chevron, 

ExxonMobil, ConocoPhillips, and Shell, and it seems that we have 

made great progress in the methods of drilling, you know, getting 

the oil out but very little progress in a response plan and preventing a disaster. 

The other oil executives were all quick to say that what happened with BP wouldn’t have happened with them, with their company because they built things differently, the plans were different. 

But yet it seemed to me that everyone else had exactly the same 

plan for a response, so I am wondering if you could tell us your 

thoughts on this. I mean, it certainly seemed that BP cut corners 

in order to save money. 

Could this happen again, and what would happen if a second 

major blowout occurred while unified command and oil spill response equipment and personnel were busy battling the Deepwater 

Horizon spill? 

Secretary SALAZAR. Mr. Chairman, I very much appreciate your 

statement, and let me just say we very much agree with you. In 

fact, if you take a look at the three central questions, perhaps the 

two that are most obvious for me today right now is the oil spill 

response capacity representations that were made with respect to 

skimming, for example, that really has not borne out to be true. 

The issue of oil blowout containment programs. We have now every 

day from almost the very beginning I have a U.S. lead call with 

BP every morning. We go through the strategy that they are unfolding relative to the next containment program. I watched the effort fail, some partially succeed, and now hopefully moving to ultimate success. 

So in the context of that dynamic it has seemed to us that it 

would be imprudent to move forward with a lifting of the moratorium until we get some answers to those basic questions. 

Mr. ENGEL. I couldn’t agree with you more. 

Let me ask you this. The Associated Press recently reported that 

there are 27,000 abandoned wells in the Gulf of Mexico on federal 

lease lands. Now, I believe and correct me if I am wrong, that 

abandoned wells sometimes leak. 

So what tools do we have and what additional tools would you 

need to keep these abandoned wells safe? 


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Secretary SALAZAR. I have asked Michael Bromwich to development some recommendations on how you deal with these abandoned wells, and in some ways it is very reminiscent of a problem 

that some members of the committee are familiar with with respect 

to abandoned mines. Once they are abandoned, no one owns them, 

and there is not a lot that sometimes can be done for a very long 

time. 

So I would hope that as part of our overall Gulf Coast Restoration Plan and dealing with oil and gas production that that is an 

issue that can be addressed perhaps both legislatively as well as 

dealing with the resource issues that would be required in order to 

deal with the abandoned wells. 

Mr. ENGEL. Thank you. I am going to yield back the balance of 

my time because I know the time is late, and you have to go, and 

we have a couple of members who still need to—yes. 

Mr. Sullivan, 5 minutes. 

Mr. SULLIVAN. Well, thank you, Mr. Chairman. 

Mr. Secretary, thank you for being here today, and I just wanted 

to ask as Secretary did you prior to the Deepwater Horizon incident consider improving rules and regulations regarding MMS, inspections of offshore exploration and production operations, prior to 

the Deepwell Horizon—Deepwater Horizon blowout? 

Secretary SALAZAR. Yes, Congressman Sullivan, the answer to 

that is yes, there were several efforts, including notice to leasees 

to increase the safety of drilling in the outer-continental shelf. 

Their efforts included in our budgets increase the number of inspectors, and so it is an effort that was ongoing in September of 

last year. We asked the National Academy of Engineering, an arm 

of the National Academy of Science, to provide recommendations to 

us on safety issues. We had proposed a rule I believe in June of 

2009, that would have dealt with other issues out in the outer-continental shelf. So it was an ongoing effort that we had in terms of 

our reform program. 

Mr. SULLIVAN. And, you know, you have probably heard this 

analogy a lot, but when we have a commercial airline tragedy, we 

do not stop all airline travel for like 6 months. We work to find out 

the route cause in making air travel safer rather than grinding the 

airline industry to a halt. Why are we shutting down an industry 

for 6 months here, particularly given companies have drilled tens 

of thousands of offshore wells in the Gulf over the past 60 years 

without a prior accident of this nature? 

Secretary SALAZAR. The answer, Congressman Sullivan, is that if 

we were to have another tragedy like the one that we see on the 

well, there is frankly insufficient resources to be able to respond to 

that kind of an oil spill response. 

In addition, we frankly yet do not know how exactly it is that we 

are finally going to get the killing of the Macondo Well, and we will 

not rest until we have that well killed. And so in this kind of a dynamic circumstances, I have explained to the committee it seems 

to us to have the pause button in place until we can get the answers to some very fundamental, important questions relating to 

safety and relating to protection of the environment. 

Mr. SULLIVAN. And, Mr. Secretary, on the Commission that has 

been set up by the President to investigate the situation, it has 


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some former governors and Administrator of EPA. I guess former 

governor, Bob Graham, U.S. Senator Graham, former Administrator of the Environmental Protection Agency, William Reilly, 

Francis, and I may get his name wrong, Beinecke. Is that how you 

say it? President of the Natural Resource Defense Council. It is a 

non-profit corporation. Donald Boesch, President of the University 

of Maryland, Center for Environmental Science, Terry Garcia is 

Vice-President for Mission Programs for the National Geographic 

Society, Cherry Murray is Dean of Harvard School of Engineering, 

and Francis, I think it is Ulmer, Chancellor of the University of 

Alaska. 

When the President put this together, why do you think—or does 

anyone here have experience in drilling wells and work in the oil 

and gas industry at all? 

Secretary SALAZAR. I do not know the members of the Commission, Congressman Sullivan, other than the two chairs, and I think 

maybe two or three other members of the Commission, but I do 

know that in selecting the members they were selected because 

they were the kinds of elder statesmen that would do a great job 

in reporting out the cause of what happened here and making recommendations. 

They also have understood they are in their staff that they are 

putting in the subject matter expertise that will ultimately be 

needed for them to do their job. So I am confident that at the end 

of the day the mission that has been given to the Commission, 

which is to leave no stone unturned as we find out what exactly 

happened with this particular blowout, that they will be able to 

achieve that mission. 

Mr. SULLIVAN. And I think you are right. They are elder statesmen. I think they are going to do a good job in that regard. I believe there is a lot of intelligence on this committee, too, but I 

just—I would like to see, and it is too late now, but I don’t know 

why they didn’t include someone that is from the industry that 

could actually, you know, use real-life experiences to help with this 

is all I am trying to get at I guess. 

Secretary SALAZAR. Well, I think former EPA Administrator Bill 

Reilly is also on the—was on the Board, maybe he still is on the 

Board of ConocoPhillips. I also understand that they have hired 

and are hiring additional people with subject matter expertise as 

staff members to the Commission. 

Mr. SULLIVAN. Thank you, sir. Thank you for being here. 

Mr. ENGEL. Mr. Gingrey. 

Mr. GINGREY. Mr. Chairman, thank you, and Mr. Secretary, I 

apologize for coming in late, and I may indeed ask you a question 

that has already been asked, so forgive me if I do that. 

In my opening statement I commented a little bit about the 

changing of management services to—and I am not going to try to 

remember what the new name is, but my concern was that at a 

time when we needed to have all our resources, all hands on deck, 

if you will, to try to stop the leak and to effect the cleanup ASAP 

that here we were, you were, indeed, charged maybe, maybe it was 

the Secretary, responsibility to do that as soon as possible, but if 

you can tell us what exactly, what was the emergency in regard to 

reorganization of MMS, and what exactly have we done? You know, 


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I don’t want to sit here and suggest to you that it is rearranging 

the deck chairs on the Titanic, but, you know, naturally people are 

a little bit concerned. 

So my question is simply this. What did you do, and what does 

this do, and how does it make it more effective and more fail-safe 

and correct some of the existing problems that you recognized after 

this disaster occurred? 

Secretary SALAZAR. Thank you very much, Congressman 

Gingrey. Let me answer in a number of—with a number of different points. 

First, my view has been as I testified in September of last year 

before Representative Rahall’s committee that it is important that 

an organization like MMS have an organic statute because it has 

existed by executive order since 1981, and it has some critical functions including the safe production of our oil and gas for our Nation 

as well as generating on average about $13 billion a year. An agency that has that kind of importance for the American people should 

have a legislative construct. 

Number two, with respect to my reorganization of the agency, 

what we have done is we have taken the people who are involved 

in the revenue collection and moved them to another unit of the department. They essentially are about 700 people who are mostly located in the Lakewood Office where we had terminated the Royalty-in-Kind Program earlier this year because of the sex and drug 

scandals. We think there needs to be distance from the revenue collector from those who are actually leasing out the resource of the 

American taxpayer. So that is one unit that, if you will, the revenue collector. 

Then there are two other units. One unit will actually be the bureau that will actually decide how and where to lease so they will 

go through the creation of the 5-year plan for the OSC, the leasing 

plans, the lease sales, the exploratory plans, and the issuance of 

the APDs. 

And then a third unit that essentially will be the inspection and 

enforcement unit, making sure that the laws, the regulations both 

with respect to the environment and safety are being complied to. 

Mr. GINGREY. Mr. Secretary, that particular unit, will that be 

beefed up manpower wise? 

Secretary SALAZAR. Our proposal is to beef it up significantly. 

There is a—it is part of the supplemental legislation that is pending before Congress to begin the first chapter of beefing that up, 

and we hope to have a budget amendment that could increase the 

number of inspectors and others that are needed to work within 

the new agency by as many as 450 personnel. 

It seems, Congressman Gingrey, as I said earlier on that it is a 

fool’s errand, if you will, to have 4,000 production facilities in the 

Gulf of Mexico alone and to only have 60 people that are assigned 

to go out and do the inspections. So the robustness of this agency 

I think is a necessity for us as a country to move forward with safe 

oil and gas production in the outer-continental shelf. 

Mr. GINGREY. Mr. Secretary, I hope that we will need those 400 

more and not—even more if we continue the moratorium. So I got 

to get that plug into you as well. As soon as we can stop this, I 

think, ill-advised moratorium and hire those 450 additional people 


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and get that drilling going again in a safe and effective manner, 

I think that is what we would like to see, at least from this side 

of the aisle, and I hope you would agree with us, and thank you 

so much for being here and testifying and responding to my questions. 

Mr. Chairman, I yield back. 

Mr. ENGEL. Thank you. Ms. Bono Mack. 

Ms. BONO MACK. Thank you, Mr. Chairman. 

Mr. Secretary, great to see you again. I think last time I saw you 

we were working together on a trails issue. It is good to see you. 

Welcome back to the Hill. 

As you probably know, my district is very abundant in renewable 

fuels, and as you probably know I support renewable fuels, but I 

also support being very honest with my constituents that in order 

to transition our economy towards future fuels, we have to do it in 

a realistic way. In your words to my colleague, Congressman Latta, 

you said it is a mistake to start and stop energy policy, but you 

are doing that very thing with this moratorium in my opinion. 

I think it is a mistake to do what you said we shouldn’t be doing, 

and I understand what you are talking about, but I just want to 

weigh in and echo my colleague’s sentiment about the moratorium 

being a mistake. Even though I believe in future fuels and moving 

us forward, we have to give certainty to people who are drilling 

today in the Gulf, so I want it to be on the record my displeasure 

with the moratorium. 

With that being said, I think what is really missing from the debate so far is the absolute lack of coordination between all the 

agencies. I live in a district as you know also that sits on top of 

the San Andreas Fault, and every day we worry about the big one 

hitting us, and I think that my constituents have gotten to the 

point where they don’t believe government is going to be there for 

them, and I don’t believe that they think they are going to be well 

coordinated and provide a good response to a disaster, and I think 

this is a perfect example of that. 

Can you tell me as we go forward with habitat restoration and 

all that has to be done what you are doing to make sure the agencies under your purview, whether it is National Park Service, 

whether it is Fish and Wildlife, BLM, whomever it is, how are they 

going to be better coordinated, and more importantly I think to 

bring the state in. In the emergency response plans the state is a 

huge leader in all of those decisions that would be in response to 

a disaster, but in this case they are being ignored, and we are 

hearing constantly from the governors that their ideas and their 

suggestions are being completely ignored. 

Can you respond a little bit to what you would do differently, 

how we are going to do this going forward, and reassure my constituents that we do have our act together because I don’t think 

that they are going to believe that for a minute. 

Secretary SALAZAR. I appreciate your questions very much. Let 

me just say first on the stop and start comment that I made, I 

made it with respect to National Energy Policy, which I think everybody would agree has not worked through the ’70s, the ’80s, the 

’90s, and even until today. 


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Ms. BONO MACK. And it doesn’t work today, and that is the point 

that I am trying to—— 

Secretary SALAZAR. That is why we need to have a comprehensive energy program moving forward, and that is why the President has been spending so much time on it. 

With respect to habitat restoration, just very quickly, we do believe that the Gulf Coast will be restored to a better place than it 

was before April 20, and Secretary Mabus at the direction of the 

President is leading the effort. We are working very closely with 

him, including multiple meetings that my staff and I had with Secretary Mabus yesterday. 

And then thirdly, with respect to your question on coordination, 

what I would say is this is the most Herculean response effort to 

an unprecedented disaster that the United States has ever seen, 

and I am on the front lines of it working with the President, working with my colleagues in the White House, and working with all 

of the agencies of the United States Government. And when you 

look at the resource that has been amassed to respond to this ongoing problem which is now in its 90th day, it is something that 

when you actually realize what the numbers are and the effort are, 

it makes me proud of the fact that the United States Government 

is operating in the way that it is. 

Ms. BONO MACK. Mr. Secretary, I think this is where we disagree, and I think my constituents are going to react to what you 

just said. 

You are very proud of the fact that we have a huge, bureaucratic, 

large government response to a disaster, and we are ignoring people on the local level and the local voices and people who have 

ideas. You are saying you are very proud of a huge bureaucracy 

and a bureaucratic response to it, and I think that is the problem. 

We have so many bureaucrats and people out there who don’t 

know what they are doing, and to get to my colleague Sullivan’s 

question about the panel, the President’s panel has nobody who 

even knows anything about drilling a well, you know, and I—hey, 

I consider myself a warm and fuzzy Republican, and I like a lot of 

people who are on that panel, but I think it is short-sided in the 

fact that it doesn’t have people who have serious expertise in how 

to drill a well. It just seems that bringing expertise in the oil and 

gas field to that panel would have been a good thing. 

And just since I have 13 seconds left, you still contradicted yourself. I understand what you are saying about a national energy policy, but you cannot say that it is OK to start and stop right now, 

because that is what you are doing. It is the exact same thing that 

you are advocating against. 

So I am right on the money at zero, zero, and I appreciate the 

opportunity to question the Secretary. Thank you. 

Secretary SALAZAR. If I may, Chairman Markey, just—— 

Mr. MARKEY [presiding]. Please. 

Secretary SALAZAR [continuing]. Respond to the Congresswoman. 

First, with respect to this effort and reaching out to the local communities and to the governors, every day my colleague, Valerie 

Geradin and a number of other people from the White House are 

on a telephone call where the governors participate. Some days, 

some days they don’t. The President himself has made a personal 


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outreach to them. I have done the same thing. I have been to the 

Gulf Coast, Houston, I think the last count was ten or 11 times. 

My Assistant Secretary Tom Strickland, 17 times. 

Ms. BONO MACK. But then how does that explain that there are 

still booms sitting unused in warehouses, and there are boats sitting unused, and skimmers sitting unused? You can say you can 

reach out to somebody, but it is not being deployed. 

Secretary SALAZAR. I would be happy to get you a copy of the 

daily report which we receive, but this is a huge mobilization of an 

effort to deal with a very tragic and a very unprecedented disaster, 

and the President has said, leave no stone unturned, do not rest, 

and get the job done, and that is what we are committed to do. 

Mr. MARKEY. We thank the gentlelady. 

I will tell you what we can do. I was intending on concluding the 

hearing right now, but I can recognize the gentleman from Texas 

for 2 minutes. 

Mr. BURGESS. I thank the Chairman for the recognition. 

Secretary Salazar, when President Obama came and spoke to the 

country about the problems of the Gulf, he said that he had expanded offshore drilling, ‘‘under the assurance that it would be absolutely safe.’’ 

Now, the concept of being absolutely safe, apparently there was 

a team that advised the president, Carol Browner, yourself, and 

Secretary Chu, so is that factual? Is there a team that advised the 

President on the fact that offshore drilling was—could be assured 

was absolutely safe, and were you part of that group? 

Secretary SALAZAR. Our view, Congressman Burgess, is that we 

had and still have a thoughtful plan in terms of moving forward. 

The Gulf of Mexico was a place where thousands of wells had been 

drilled. We felt that there was a place in the eastern part of the— 

that would still keep you 125 miles from Florida, for there was 67 

percent of the resource that could be recovered. 

Mr. BURGESS. So you and Carol Browner and Dr. Chu did advise 

the President that this was absolutely safe? 

Secretary SALAZAR. Let me just say what we—what I did as Secretary of the Interior is I developed this plan, and I developed the 

plan over a very long period of time that included multiple hearings from New Jersey to Louisiana to California to Alaska and 

hundreds of thousands of comments, so it was my plan and my recommendation that I made to the President. 

Mr. BURGESS. So in retrospect now would you say that you made 

a mistake, that that was wrong? 

Secretary SALAZAR. I would—no. I would say that the plan that 

we put forward was, in fact, a very thoughtful plan. We canceled 

five leases of huge sales in Alaska, for example, because we felt 

that the oil spill response capability was insufficient. 

Mr. BURGESS. But in light of what has happened were you, in 

fact, wrong at that assessment? 

Secretary SALAZAR. I think the plan that we put forward at the 

end of March was a plan which took a year to develop with huge 

input from all of the stakeholders and which I believe is still a good 

plan. 

Mr. BURGESS. OK. 

Mr. MARKEY. The gentleman’s time has expired again. 


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Mr. Chairman, you—Mr. Secretary, we know that you went 

above and beyond to be here this afternoon. It is greatly appreciated by this committee. We have jurisdiction over energy production generally in the United States of America, and so our title is 

the Energy and Commerce Committee. Your service to our country 

is greatly appreciated, and we thank you for being here today. 

This hearing is adjourned. Thank you. 

[Whereupon, at 4:30 p.m., the Subcommittee was adjourned.] 

[Material submitted for inclusion in the record follows:] 


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Memorandum 

To: 

From: 

Subject: 

United States Department of me Interior 

OFFICE OF INSPECTOR GENERAL 

Washington, DC 20240 

SEF - 9 2008 

Secretary Kempthome 

Inspector 

EarlE. Devaney General ~C>\....XC> () (~ 

OIG Investigations ofMMS Employees 

This memorandum conveys the final results of three separate Office of Inspector General 

(OIG) investigations into allegations against more than a dozen current and former Minerals 

Management Service (MMS) employees. In the case of one former employee, Jimmy Mayberry, 

he has already pled guilty to a criminal charge. The cases against former employees, Greg Smith 

and Lucy Querques Dennet, were referred to the Public Integrity Section of the Department of 

Justice (DOJ). However, that office declined to prosecute. The remaining current employees 

await your discretion in imposing corrective administrative action. Others have escaped 

potential administrative action by departing from federal service, with the usual celebratory 

send-offs that allegedly highlighted the impeccable service these individuals had given to the 

Federal Goverument. Our reports belie this notion. 

Collectively, our recent work in MMS has taken well over two years, involved countless 

OIG human resources and an expenditure of nearly $5.3 million ofOIG funds. Two hundred 

thirty-tbree witnesses and subjects were interviewed, many of them multiple times, and roughly 

470,000 pages of documents and e-mails were obtained and reviewed as part of these 

investigations. 

I know you have shared my fi:ustration with the length of time these investigations have 

taken, primarily due to the criminal nature of some of these allegations, protracted discussions 

with DOJ and the ultimate refusal of one major oil company - Chevron - to cooperate with our 

investigation. Since you have already taken assertive steps to replace key leadership and staff in 

the affected components ofMMS, I am confident that you will now act quickly to take the 

appropriate administrative action to bring this disturbing chapter of MMS history to a close. 

A Culture of Ethical Failure 

The single-most serious problem our investigations revealed is a pervasive culture of 

exclusivity, exempt from the rules that govern all other employees of the Federal Goverument. 
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In the matter involving Ms. Denne!, Mr. Mayberry and Milton Dial, the results of this 

investigation paint a disturbing picture of three Senior Executives who were good friends, and 

who remained calculatedly ignorant of the rules governing post-employment restrictions" 

conflicts of interest and Federal Acquisition Regulations to ensure that two lucrative MMS 

contracts would be awarded to the company created by Mr. Mayberry - Federal Business 

Solutions - and later joined by Mr. Dial. Ms. Dennet manipulated the contracting process from 

the start. She worked directly with the contracting officer, personally participated on the 

evaluation team for both contracts, asked for an increase to the first contract amount, and had 

Mayberry prepare the justification for the contract increase. Ms. Dennet also appears to have 

shared with Mr. Mayberry the Key Qualification criteria upon which bidders would be judged, 

two weeks before bid proposals on the first contract were due. 

Intbe other two cases, the results of our investigation reveal a program tasked with 

implementing a "business model» progra.m. As such, Royalty in Kind (RlK) marketers donned a 

private sector approach to essentially everything they did. This included effectively opting 

themselves out of the Ethics in Government Act, both in practice, and, at one point, even 

explored doing so by policy or regulation. 

Not ouly did those in RlK consider themselves special, they were treated as special by 

their management. For reasons that are not at all clear, the reporting hierarchy ofRlK bypassed 

the one supervisor whose integrity remained intact throughout, Debra Gibbs-Tschudy, the 

Deputy Associate Director in Denver, where RlK is located. Rather, RIK was reporting directly 

to Associate Director Dennet, who was located some 1500 miles away in Washington, DC, and 

to whom the unbridled, unethical conduct of RIK employees was apparently invisible (although 

the Associate Director had been made aware of the plan by RIK to explore more formal 

exemption from the ethics rules.) 

More specifically, we discovered that between 2002 and 2006, nearly 113 of the entire 

RIK staff socialized with, and received a wide array of gifts and gratnities from. oil and gas 

companies with whom RlK was conducting official business. While the dollar amonnt of gifts 

and gratnities was not enormons" these employees accepted gifts with prodigious frequency. In 

particular, two RIK marketers received combined gifts and gratnities on at least 135 occasions 

from four mllior oil and gas companies with whom they were doing business - a textbook 

example of improperly receiving gifts from prohibited sources. When confronted by our 

investigators, none of the employees involved displayed remorse. 

We also discovered a culture of substance abuse and promiscuity in the RlK program -

both within the program, including a supervisor, Greg Smith, who engaged in illegal drug use 

and had sexual relations with subordinates, and in consort with industry. Internally, several 

staff admitted to illegal drug use as well as illicit sexual encounters. Alcohol abuse appears to 

have been a problem when RlK staff socialized with industry. For example, two RIK staff 

accepted lodging from industry after industry events because they were too intoxicated to drive 

home or to their hotel. These same RIK marketers also engaged in brief sexual relationships 

with industry contacts. Sexual relationships with probibitedsources cannot, by definition, be 

arms-length. 

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Finally, we discovered that two of the RIK employees who accepted gifts also held 

inappropriate outside employment and failed to properly report the income they received from 

this work on their financial disclosure forms. Smith, in particnlar, deliberately secreted the trae 

nature of his outside employment - he pitched oil and gas companies thirt did business with RIK 

to hire the outside consulting finn - to prevent revealing what would otherwise, at a minimum, 

be a clear conflict of interest. . 

C-ondusion 

As you know, I have gone on record to say that I believe that 99.9 percent of DOl 

employees are hard-working, ethieal and well-intentioned. Unfortunately, from the cases 

highlighted here, the conduct of a few has cast a shadow on an entire bureau. 

In -summary, our investigation revealed a relatively small group of individuals wholly 

lacking in acceptance of or adherence to government ethical standards; management that through 

passive neglect, at best, or purposeful ignorance, at worst, was blind to easily discerm'ble 

misconduct; and a program that had aggressive-goals and admirable ideals, but was launched 

without the necessary internal controls in place to ensure conformity with one of its most 

important principles: "Maintain the highest ethieal and professional standards." This must be 

corrected. 

Recommendations 

In conclusion, we offer the following Recommendations. 

t. Take appropriate administrative corrective action. 

Some very serious misconduct is identified in these reports. While the OIG generally 

does not take a position concerning what administrative corrective action might be 

appropriate in any given matter, in this instance there may be significant enough 

misconduct to warrant removal fur some individuals. Given the unwillingness of some to 

acknowledge their conduct as improper, the subjects of our reports should be carefully 

considered for a life-time ban from working in the RIK program. 

2. Develop an enhanced ethics program designed specifically for the RIK program. 

Given the RIK culture, an enhanced ethics program must be designed for RIK. including, 

but not limited to, 1) an explicit prohibition against acceptance of any gifts or gratuities 

from industry, regardless of valUe; 2) a robust training program to include written 

certification by employees that they know and understand the ethics requirements by 

which they are bound; and 3) an augmented MMS Ethics Office. 

3. Develop a dear, strict Code of Conduct for the RtK program. 

A :fundamental Code of Conduct with clear obligations, prohibitions, and consequences 

appears to be necessary to repair the culture of misconduct in the RIK program. This -

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code should.include a clear probibition against outside employment willi tbe oil and gas 

industry or consultants.to. that industry. Given llie considerable financial responsibilities 

involved, MMS should also consider implementing a Random Drug Testing program 

specifically for RlK. 

4. Consider cbanging the reporting structnre ofRIK. 

The management. reporting structure of the RIK program must be seriously reconsidered. 

Given the challen.ges that will be fuccirin rebUilding this program, it seems imperative 

that RIK have management oversight in immediate proximity, not some 1,500 miles 

away in Washington, DC. 

If you have any questions, please do not hesitate to contact me at (202) 208-5745. 

Attachments 

4 
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tt~t ton pofi 

Ban on deep-water drilling adds insult to injury 

By Bobby Jindal 

Saturday, July 17,2010; AI3 

By now, everyone no doubt realizes that I am not a fan of the pace at which the federal government 

has worked to contain the oil spill in the Gulf of Mexico. Sadly, federal officials were slow to act and 

overly bureaucratic. They have never really understood the urgency of the situation down here, I'm 

not raising a question of motive; it's simply a function of the federal government being a slow-moving 

albatross, The only way to attack a crisis like this is with the urgency of a military mind-set. 

Even after the well is finally capped, the damage done to our environment, to the Gulf of Mexico, and 

to our marshes, wetlands and beaches will take years to repair. There is another type of damage from 

this spill: its human impact. Thousands of lives, businesses and families are reeling. 

Against this backdrop, the federal government unwisely chose to add insult to injury by decreein£' a 

moratorium on deepwater drilling in the £.!!Jf. This ill-advised and ill-considered moratorium, which a 

federal judge called "arbitrary" and "capricious," creates a second disaster for our economy, throwing 

thousands of hardworking folks out of their jobs and causing real damage to many families. Now this 

federal policy risks killing 20,000 more jobs and will result in a loss of $65 million to $135 million in 

wages each month. 

To ensure that such a disaster does not happen again, should the federal government increase 

oversight, or require additional and better equipment or on-site federal inspectors, or even temporarily 

pause drilling at specific rigs for additional reviews? Of course. Could it? Of course. But by simply 

stopping all deepwater drilling, federal officials appear more interested in ideology and scoring 

political points -- as they have done with the misguided cap-and-trade legislation -- at the expense of 

Americans who derive their livelihood from the energy industry. 

Let's be clear: This moratorium will do nothing to clean up the Gulf of Mexico, and it is already doing 

great harm to many hardworking citizens. The effects will extend well beyond Louisiana. Since the 

moratorium was announced, America has already lost two rigs to foreign countries. More drilling 

companies are negotiating right now to work elsewhere. Every time we decrease our level of 

production, we make America more dependent on foreign sources of energy. 

On those few occasions when our country suffers a commercial airline tragedy, we do not respond by 

stopping all air travel for six months. Rather, we get to work figuring out the root cause and set about 

trying to make air travel safer. We don't grind everything to a halt and put tens of thousands of people 

out of work, jeopardizing our economy. 

So, my state joined a lawsuit against the moratorium. We pointed out that a majority of the experts the 

federal government consulted before the ban, including representatives f1'Om the National Academy of 

Engineering. havc staled publicly that thcY.90 not agree vl:,ith the six-month blanket moratorium. 
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The court sided with the people of Louisiana in this matter. Consider the lJJ.dge's statements: that the 

federal moratorium would result in the loss of jobs and livelihoods, that the government's action "does 

not seem to be fact-specific" and that the "government's hair-splitting explanation abuses reason and 

common sense.1! 

One might assume that the federal government would back down, lift the moratorium and get on with 

the business of ensuring that nothing like this ever happens again in federal waters. 

Nope. 

Our federal government chose to fight on in court, and lost a second time. 

Surely now, many of us thought, the federal government would stop its efforts to halt all drilling and 

instead get serious about more rigorous oversight and inspections. 

Nope. 

Instead, the federal government drafted a new moratorium. This seems to be a cynical ploy. It will 

take time to again take federal officials to court. If Washington loses, officials can issue a third 

moratorium and play this game out as long as they want. Such is the power of the federal government. 

Louisianans, of all people, don't want to see another drop of oil spilled into the Gulf of Mexico. It is 

our land and our way of life that are being harmed. Yet the administration tells our people to simply 

file a claim with BP or file for unemployment. OUf people want to work, not collect unemployment 

checks. 

We don't want to see the federal government create a second disaster, an economic disaster, for the 

people of our state thanks to its "capricious" and "arbitrary" actions. The bottom line is this: 

Thousands of Louisianans shouldn't have to lose their jobs just because the federal government can't 

do its job. 

The writer, a Republican, is governor of Louisiana. 

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HENflY WAXMAN, CAUFQHN1A 

(';HAIRMAN 

ONE HUNOREO ELEVENTH CONGRESS 

((ongrcss of tIJe 'Ilntttl.l ~tatts 

,l!,lOUB£ of i'\rprescntiltilJtB 

COMMITTEE ON ENERGY AND COMMERCE 

2125 RAYUUHN HOUSF OfFlCF Bun.DING 

WASHINGTON, DC 20515-6115 

MEMORANDUM 

July 16,2010 

BARTON. TEXA,$ 

HANKING MEMBrR 

To: Subcommittee ou Energy and Environment and tbe Subcommittee on Oversigbt 

and Investigations Mem bers and Staff 

Fr: Committee on Energy and Commerce Staff 

Re: Hearing on "The Role of the Interior Department in tbe Deepwater Horizon 

Disaster" 

On Tuesday, July 20, 2010, at 10:00 a,m, in room 2123 of the Rayburn House Office 

Building, the Subcommittee on Oversight and Investigations and the Subcommittee on Energy 

and Environment will hold a joint hearing entitled "The Role of the Interior Department in the 

Deepwater Horizon Disaster," This hearing will examine the Interior Department's actions 

before and since the Deepwater Horizon explosion on April 20, 20 I 0, 

I, BACKGROUND 

On April 20, 20 I 0, the Deepwater Horizon, an oil rig contracted by BP to drill a 

deepwater well in the Gulf of Mexico, exploded, Eleven people died and 15 were injured, After 

a second explosion on April 22, 2010, the Deepwater Horizon sank, breaking the riser pipe 

running from the rig to the seafloor where it had been attached to the well's blowout preventer 

(BOP). On April 24, 2010, remotely operated vehicles (ROVs) confirmed that oil was spewing 

from the site into the Gulf of Mexico, 

After repeated efforts failed to activate the BOP at the wellhead and shut off the well, BP 

made various attempts to stem the flow of oil from the well site, In May, the company began 

drilling two relief wells to intersect the original well and plug it; it is estimated that these relief 

wells may be completed by mid-August 1 BP's interim measures have failed to stop the leak: 

1 BP Oil Spill: Relie/Well is Ahead a/Schedule, Close to Target, Christian Science 

Monitor (July 7, 2010) (online at www.csmonitor.com/Environment/201O/0707IBP-oil-spillRelief-well-is-ahead-of-schedule-close-lo-target), 
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• A containment dome, placed over the flow on May 7, 2010, became clogged with 

frozen gas and water; 

• In late May, the "top kill" and 'junk shot" procedures, in which liquid and objects 

were pumped into the well to clog it, did not stem the leak; 

• Another cap, placed on June 3, 2010, began gathering a small fraction ofthe oil. 

Preliminary tests yesterday ofa new containment cap lowered on July 10,2010, suggest 

that the new cap may have stopped the leak for the first time since April. 

The Flow Rate Technical Group, a collection of scientists convened by U.S. Coast Guard 

Commandant Admiral Thad Allen, has estimated that oil is flowing into the Gulf at a rate of 

35,000 to 60,000 barrels a day. 2 Under the top official estimate for leakage rates, this amounts to 

over 3 million barrels, of which approximately 750,000 has been collected. 

President Obama has called the oil spill in the Gulf the "worst environmental disaster 

America has ever faced." To date, response and recovery operations have cost an estimated $3.5 

bilJion/ and the federal govemment has billed BP $222 million.4 BP is strictly liable for 

cleanup costs. In June, BP committed $20 billion to a fund that will be independently 

administered to pay damage claims resulting from the blowout. 

II. COMMITTEE INVESTIGATION 

The Oversight and Investigations Subcommittee has held three hearings on the 

Deepwater Horizon incident. On May 12,2010, the subcommittee examined the causes of the 

explosion, hearing testimony from officials from the major companies involved: BP, which 

leased the rig; Transocean, which owned the rig; Halliburton, which performed the cement work 

on the well; and Cameron, which manufactured the BOP used at the wellhead. The 

subcommittee leamed about the local impact of the spill at a field hearing in Chalmette, 

Louisiana on June 2, 2010. BP CEO Tony Hayward testified before the subcommittee at a 

hearing on June 17, 2010, where he was asked about decisions made on the rig that appeared to 

compromise safety in order to cut costs. 

The Energy and Environment Subcommittee has held four hearings related to the oil spill. 

On May 27,2010, the subcommittee examined the ongoing response to the spill, hearing 

testimony from representatives from EPA, NOAA, the Interior Department, the Army, and the 

2 Department ofthe Interior, US. Scientific Team Draws on New Data, MUltiple 

Scientific Methodologies to Reach Updated Estimate of Oil Flows from BP 's Well (June 15, 

2010) (online at www.doi.gov/news/pressreleases/Flow-Rate-Team-Updates-Estimate-of-OilFlowing-from-BP-Well.cfm). 

3 BP Says Oil Spill Costs Climb to $3.5 Billion, Associated Press (July 12,2010). 

4 Deepwater Horizon Incident Joint Information Center, Administration Sends Fourth Bill 

to BP (July 13,2010) (online at www.deepwaterhorizonresponse.com/go/doc/293117788791). 

2 
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Coast Guard. It studied some of the spill's potential impacts on people and the environment at a 

June 10,2010 hearing. On June 15,2010, heads of five major oil companies - BP, Chevron, 

ConocoPhillips, ExxonMobil, and Shell- responded to questions about the safety of deepwater 

drilling and their preparedness for a spill. The subcommittee held a legislative hearing on June 

30,2010, to discuss a draft of the "Blowout Preventer Act of201 0," which provides solutions to 

some of the problems revealed by the Deepwater Horizon incident. 

III. DEPARTMENT OF THE INTERIOR 

Following the explosion of the Deepwater Horizon, the Interior Department has taken 

action to learn about what went wrong on the rig. A few weeks after the accident, the Minerals 

Management Service (MMS) and the Coast Guard launched a joint investigation to determine the 

cause of the Deepwater Horizon incident and to make safety recommendations.s Thejoint 

investigation's third round of hearings commences on July 19,2010. 

In addition, addressing concerns that MMS' duties to collect royalties, ensure safety, and 

conduct oversight were in conflict with one another, Secretary Salazar issued a Secretarial Order 

on May 19,2010, dividing MMS into three new and separate organizations -the Bureau of 

Ocean Energy Management, the Bureau of Safety and Environmental Enforcement, and the 

Office of Natural Resources Revenue. 6 On July 14,2010, the Interior Department issued a 

report on implementation of the Secretary's Order. 

The Interior Department has taken several steps to ensure that offshore drilling is safer in 

the future. Shortly after the explosion, MMS and the Coast Guard issued safety 

recommendations to operators and drilling contractors, directing them to examine well control 

equipment, drilling and casing practices, lifesaving, firefighting, and other emergency 

equipment, and to ensure that personnel are properly trained. 7 In response to a directive from 

President Obama, Secretary Salazar issued a 30-day safety report outlining measures to promote 

safety in drilling in the Outer Continental Shelf.8 His recommendations included new safety 

measures regarding BOPs, well control, and personnel. In addition, the report announced a 

temporary six-month moratorium on new wells being drilled with floating rigs. MMS directed 

lessees and operators to implement the safety measures outlined in the Secretary's report through 

5 Deepwater Horizon Joint Investigation, (online at 

www.deepwaterinvestigation.com/go/site/30431) 

6 Department of the Interior, Order No. 3299, Establishment of the Bureau of Ocean 

Energy Management. the Bureau of Safety and Environmental Enforcement. and the Office of 

Natural Resources Revenue (May 19,2010) (online at 

www.doi.gov/deepwaterhorizon/loader.cfm?csModule=securityigetfile&PageID=32475). 

7 MMSIUSCG Joint Safety Alerts No.2 (Apr. 30, 2010) (online at 

www.mms.gov/safetyalerts/joint_2.htm). 

8 Department of the Interior, Increased Safety Measuresfor Energy Development on the 

Outer Continental Shelf(May 27, 2010) (online at 

www.doi.gov/deepwaterhorizon/loader.cfm?csModule=security/getfile&PageID=33598). 

3 
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a Notice to Lessees (NTL). 9 In another new NTL, Secretary Salazar reversed a 2003 decision by 

the Interior Department that had exempted many lessees from submitting a blowout scenario. 10 

Secretary Salazar's initial moratorium was halted by the 5th Circuit Court of Appeals. 

On July 12, 2010, Secretary Salazar issued a new suspension of deepwater drilling on wells that 

use a subsea or surface BOP on a floating facility in the Outer Continental Shelf.] J This new 

"temporary pause" is narrower than the first, focusing on drilling configurations and 

technologies rather than drilling depth. In his memorandum announcing the decision, Secretary 

Salazar weighs the economic impact of the suspension, but states that the temporary suspension 

is necessary because of the serious threat presented by continued drilling. 

IV. WITNESSES 

The following witnesses have been invited to testify: 

The Honorable Gale Norton 

Secretary of the Interior, 2001-2006 

The Honorable Dirk Kempthorne 

Secretary of the Interior, 2006-2009 

The Honorable Ken Salazar 

Secretary of the Interior 

9 Minerals Management Service, NTL No. 2010-N05, Increased Safety Measuresfor 

Energy Development in the OCS (June 8, 2010) (online at 

www.doi.gov/deepwaterhorizon/loader.cfm?csModule=securityIgetfile&PageID=34536). 

10 Minerals Management Service, NTL. No. 2010-N06, Information Requirementsfor 

Exploration Plans, Development and Production Plans, and Development Operations 

Coordination Documents in the OCS (June 18,2010) (online at 

www.doi.gov/deepwaterhorizoniloader.cfm?csModule=security/getfile&PageID=35724) 

1I Department of the Interior, Decision Memorandum Regarding the Suspension of 

Certain Offshore Permitting and Drilling Activities on the Outer Continental Shelf (July 12, 

20 I 0) (online at 

www.doi.gov/deepwaterhorizon/loader.cfm?csModule=security/getfile&PageID=38375). 

4 
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The 2010 Oil Spill: 

Minerals Management Service (MMS) and 

National Environmental Policy Act (NEPA) 

Kristina Alexander 

Legislative Attorney 

June 1, 2010 

Congressional Research Service 

7-5700 

www.crs.gov 

R41265 

CRS Report for Congress----------------

Prepared for Members and Committees of Congress 
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'l'h£ 2010 Oil Spill: MMS and NEPA 

Summary 

On April 20, 2010, an exploratory oil well in the Gulf of Mexico exploded, killing 11 people and 

causing an oil spill that a group of federal experts has said is the worst in American history. The 

oil well was on a tract leased by British Petroleum (BP), having obtained a lease and the relevant 

permits from the federal government. Under relevant federal law, federal actions that may have 

adverse environmental effects are required to be reviewed for potential environmental harm under 

the National Environmental Policy Act (NEPA). This report will review those environmental 

procedures. While there are additional environmental obligations imposed on Outer Continental 

Shelf (OCS) drilling by other acts, this report will not review those requirements. 

Multiple environmental reviews were conducted by the Minerals Management Service (MMS) at 

each stage of OCS development. For the particular well in question, MMS addressed the 

environmental impacts on four occasions, including two full environmental impact statements, an 

environmental assessment, and a categorical exclusion. The fact that MMS categorically excluded 

the exploration plan from a NEPA analysis is controversial, since that is the first step in which 

drilling would be conducted. It appears MMS followed its internal procedure for NEPA reviews 

in the western and central areas of the Gulf of Mexico by employing a categorical exclusion for 

an exploration pian. However, that procedure has never been reviewed by a court to see if it is 

consistent with the law or whether an exception to the categorical exclusion may apply in this 

case. Had this project occurred in a different geographical area, including the eastern area of the 

Gulf of Mexico, it would have undergone a higher level of environmental scmtiny. 

Congressio1l41 Research Service 
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'Ihe 2010 Oil Spill: MMS and NEPA 

Contents 

Background and Context ........................................................................................... ; ................. 1 

NEPA .......................................................................................................................................... 1 

MMS NEPA Reviews ............................................................................................................ 3 

The 2007-2012 Outer Continental Shelf Oil and Gas Leasing Program ................................. .4 

The EIS for the 5-year Plan ................................................................................................... 4 

The EIS for 11 Gulf of Mexico Lease Sales ........................................................................... 6 

Adequacy of the Environmental Review of the Multiple Lease Sales ............................... 8 

Lease Sale 206 Environmental Assessment.. ........................................................................ 10 

Categorical Exclusion for the Exploration Plan .................................................................... 11 

Adequacy of the Environmental Review of the Exploration Plan ................................... 13 

Conclusion ................................................................................................................................ 15 

Appendixes 

Appendix A. Background Facts ................................................................................................. 16 

Appendix B. MMS Categorical Exclusions ............................................................................... 18 

Appendix C. The MMS Categorical Exclusion Review Process ................................................. 21 

Contacts 

Author Contact Information ...................................................................................................... 24 

CongressiOlU1.1 Research Service 
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The 2010 Oil Spill: MMS and NEPA 

Background and Context 

On April 20, 2010, an exploratory oil well in the Gulf of Mexico exploded, killing II people and 

causing an oil spill that a group of federal experts says is the worst spill in United States history. 1 

The oil well was on a tract leased by British Petroleum (BP), having obtained an oil and gas lease 

and the relevant permits from the federal government. The spill was at the Mississippi Canyon 

Block 252, which is one block obtained by BP under Lease Sale 206. Under applicable federal 

law, federal actions that may have adverse environmental effects are required to be reviewed for 

potential environmental harm under the National Environmental Policy Act (l\'EPA). Additional 

environmental obligations are imposed by the Outer Continental Shelf Lands Act (OCSLA),2 

Endangered Species Act,3 Marine Mammal Protection Act,4 and the Coastal Zone Management 

ActS but will not be examined within this report. Rather, this report focuses on the environmental 

analyses conducted by MMS and their compliance with NEPA. 

NEPA 

NEPA states that for all "major Federal actions significantly affecting the quality of the human 

environment" federal agencies shall prepare a "detailed statement" of "the environmental impact 

of a proposed action, any adverse environmental effects which carmot be avoided should the 

proposal be implemented, [and) alternatives to the proposed action.,,6 Agencies must comply to 

"the fullest extent possible." 

The Minerals Management Service (MMS) of the Department of the Interior is the federal agency 

charged with overseeing oil and gas exploration of the Outer Continental Shelf (OCS). MMS 

issued the lease to and approved the exploration plan of BP for the oil well that caused the spill. 

Under NEPA terminology, MMS is the lead agency for any environmental reviews. 7 

NEPA includes three types of environmental reviews with different levels of scrutiny into the 

environmental effects of an action. The goal of the reviews is for an agency to be able to 

demonstrate that it has taken an appropriately hard look at the environmental consequences of its 

plarmed activity.8 The environmental review is also supposed to involve the pUblic.9 The most 

, Department of the Interior Press Release, Flow Rate Group Provides Preliminclry Best Estimate Of Oil Flowingfrom 

BP Oil Well (May 27,2010). Available online at http://www.doi.gov/newsipressreleaseslFlow-Rate-Group-ProvidesPreliminary-Best-Estimate-Of-Oil-Flowing-from-BP-Oil-Well.cfrn, Original estimates that the well was leaking oil at 

5,000 barrels a day were found to be low. 

243 U.S.C. §§ 1331-1356a. For analysis of the OCSLA, see CRS Report RL33404, Offshore Oil and Gas 

Development: Legal Framework, by Adam Vann. 

1 16 U.S.C. § 1531 - 1544. See Section 1536 for consultation obligations offedera! agencies. 

4 16 U.S.C. §§ 1361 - 1384. See Section 1371(a)(5)(A) forincidental takes of marine mammals. 

5 16 U.S.C. §§ 1451-1456. See Section 1456(c) for federal actions affecting coasts. 

6 42 U.S.C. § 4332. The act also requires consideration of "(iv) the relationship between local short-term uses of man's 

environment and the maintenance and enhancement of long-teno productivity. and (v) any irreversible and irretrievable 

commitments of resources ... " 

7 MMS was reorganized, effective May 19, 2010. Secretary of the Interior Order No. 3299. It appears that under this 

reoganization, the NEP A functions would be perfonned by the Bureau of Ocean Energy Management 

S Kleppe v. Sierra Club, 427 U.S. 390, 410 n.21 (1976) (the role ofa court is toensuretban an agency took a '''hard 

look' at the environmental consequences); National Audubon Society v. Department of the Navy. 422 F.3d 174, 185 

(continued ... ) 

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The 2010 Oil Spill: MMS and NEPA 

comprehensive review is concluded by an environmental impact statement (EIS). It is required by 

NEPA for all agency actions that will significantly affect the environment. An EIS should 

demonstrate that the agency considered a reasonable range of alternatives that took a hard look at 

the environmental consequences of a proposed action. An EIS also requires extensive public 

involvement, including a public comment period for a draft EIS and consideration of those 

comments in the final document. 

Where an action may not have significant effects, or when an agency is unsure of the degree to 

which an action may have significant impacts, a review called an environmental assessment (EA) 

is conducted. An EA also requires consideration of alternatives to the action and a review of the 

effects, but it is intended to be an abbreviated review. The public comment period is limited and 

could occur only upon completion of a fmal document. 

The third type of review is for actions that agencies have pre-determined have no significant 

impact, typically because an agency routinely conducts the activity. This type of review is a 

categorical exclusion (CE, sometimes known as a Cat Ex). Technically, it means a formal review 

is not required because the agency has already determined that the environmental consequences 

of the action will not be significant. 10 Agencies prepare lists of CEs and may exclude a particular 

action if it is on that list. The decision to invoke a CE for a project must be documented in some 

way.lI CEs are not allowed when there are extraordinary circumstances surrounding a proposed 

action, which generally include the presence of endangered species or significant resources of 

some type, such as archeological sites. This is consistent with the purpose of CEs-they do not 

apply when there could be a significant environmental impact. 

Aside from the interpretive case law, the requirements for NEPA reviews can be found in two 

places; the regulations issued by the Council on Environmental Quality (CEQ); 12 and within 

agency-specific regulations or guidelines. Generally speaking, the CEQ regulations provide the 

foundation for NEPA compliance, while the agency guidelines provide for more specific 

application to the circumstances of a particular agency. In the case ofMMS, NEPA procedures are 

found within the Department of the Interior agency-wide NEPA guidelines in the Departmental 

Manual (DM),13 as well as in MMS guidelines within the DM.14 

( ... continued) 

(4th Cir. 2005) (a hard look "encompasses a thorough investigation into the environmental impacts ofan agency's 

action and a candid acknowledgement oftlle risks that those impacts enlBil"); Idaho Conservation League v. Mumma, 

956 F.2d 1508, 1519 (9" Cir. J 992) (courts review whether an EIS "contains a reasonably thorough discussion of the 

siguificant aspects oftne probable environmental wnsequences"); Natural Resources Defense Council, Inc. v. Morton, 

458 F.2d 827, at 838 (D.C. Cir. 1972) (an environmental review complies with NEPA "so long as the officials and 

agencies have taken the 'hard look' at environmental consequences mandated by Congress"). 

940 C.F.R. § 1506.6. See California v. Block. 590 F.2d 753 (9'" Cir. 1982) (infonned public participation is a goal of 

NEPA). 

to 40 C.F.R. § 1508.4. 

11 California v. Norton. 311 F.3d 1162 (9th Cir. 2002). 

"40 C.F.R. part 1500. 

13 516 DM I-IS. available online at http://206.131.241.l8/app_DMlindex.cfin?fuseaction9>earchDM&keyword= 

516%20DM%201.15. 

14 Sl6DM 15. 

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The 2610 Oil Spill: MMS lind NEPA 

MMS NEPA Reviews 

MMS '5 summary of its OCS program indicates there are four different stages at which it performs 

an environmental review for OCS leasillg. 15 The sunnnary indicates what type of environmental 

review is typically done at each stage. Those stages, and the typical environmental reviews, are: 

• develop as-year program-EIS; 

• plan for a specific lease sale-EIS; 

• approve the exploration plan-EA; and 

• approve development and production plan-EIS. 

The four stages are based on the OCSLA. 16 

Records indicate that MMS conducted four separate environmental reviews related to the oil well 

known as Mississippi Canyon Block 252, including two EISs, one EA, and a CEo These four 

documents relate to the flTst three stages described above; two reviews were conducted at the 

lease sale stage, and the development and production stage had not been reached. Mississippi 

Canyon Block 252 was at the exploration stage. Briefly, those four documents are as follows: 

• April 2007: MMS issued an EIS for the OCS Five Year Leasing Program, the 

2007-2012 Outer Continental Shelf (OCS) Oil and Gas Leasing Program. This 

document considered environmental impacts related to off shore drilling, not just 

within the Gulf of Mexico, but for the two other areas in which off shore drilling 

is conducted: around Alaska and along the Atlantic coast. 

• April 2007: MMS issued an EIS for the lease sale in the western and central 

portion of the Gulf of Mexico. 

• October 2007: MMS issued an EA for lease sale 206, which included Mississippi 

Canyon Block 252, finding no new significant impact. This document was 

intended by MMS to supplement the other environmental reviews, which is why 

instead of the accepted NEPA terminology of "finding of no significant impact" 

(FONSI) it referred to no "new" significant impacts. 

• April 2009: MMS issued a CE for the exploration plan that authorized BP to 

begin exploratory drilling on its site. 

Additionally, two other environmental reviews were conducted that relate to drilling in the Gulf. 

Both were prograrrunatic environmental assessments, meaning they were designed to consider 

broad impacts from a type of federal action and not just the impacts from one action. 

Prograrrunatic environmental reviews are viewed as an efficient way to consider impacts without 

creating redundant reviews. 17 In July 2004, MMS announced completion of a progranunatic EA 

that evaluated potential impacts of geological and geophysical testing in the Gulf. 18 That testing 

IS A copy of this is available online at http://www.mms.gov/PDFsl5MMS_LeasinglOl.pdf. 

16 43 U.S.C. § 1344-5-year plan; 43 U.S.C. § I 337(a)-lease sale; 43 U.S.C. § 134(}-exploration plan; and 43 U.S.C. 

§ 1351-development and production. 17 40 C.F.R § 1500.4: "Agencies shall reduce excessive paperwork by ... (i) using program, policy, or plan 

environmental impact statements and tiering from statements of broad scope to those of narrower scope, to eliminate 

repetitive discussions ofthe same issues." 

18 MMS, Geological and Geophysical Exploration for Mineral Resources on the Gulf of Mexico Outer Continental 

(continued ... ) 

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The 2()1() Oil Spill: MMS andNEPA 

included seismic testing. A different programmatic EA was announced in March 2005 for 

Structure-Removal Operations in the Gulf,19 which typically involve the use of explosives. 

The 2007-2012 Outer Continental Shelf Oil and Gas Leasing 

Program 

In February 2006, and again in August 2006, MMS sought comments on its proposed 5-year lease 

plan for 2007-2012 that would expand OCS leasing areas. The proposed plan addressed 21 OCS 

areas, including two in the Gulf of Mexico.20 An EIS for this plan was prepared, and the final 5-

year Plan EIS was completed in April 2007.21 The 2007-2012 OCS Oil and Gas Leasing Program 

became effective on July I, 2007. However, a federal court of appeals determined that MMS had 

not complied with all of the environmental requirements, and the program was returned to MMS 

for revision?2 A preliminary revised 5-year plan was announced in March 2010.23 

The EIS for the 5-year Plan 

The EIS for the 5-year Plan for 2007-201224 describes its scope as being regional and 

programmatic, and it also describes the assumptions made when evaluating the environmental 

effects of the proposed action. It divides the environmental effects based on the three 

geographical areas within the 5-year Plan: Gulf of Mexico, Atlantic, and Alaska. Different 

assumptions are made for each area, and the environmental effects are premised on that. One 

assumption for the Gulf of Mexico is the scale of oil spills that could be expected to occur.2S The 

estimates were made for potential spills during production and transportation, and do not appear 

to consider oil spills at the exploration stage. A large oil spill, according to the 5-year Plan EIS, 

would be one of 1,000 barrels (bbl) or greater. Based on historical modeling, MMS calculated a 

probable large oil spill from a platform to be 1,500 bbl and 4,600 bbl from a pipeline.26 The spill 

from the current Mississippi Canyon exploration well is categorized as a platform-related spill. 

The 5-year Plan EIS estimates that the Gulf of Mexico wells would produce 4 to 8 billion bbl of 

oil and have nine large oil spills (four from pipelines; four from platforms; and one from a 

( ... continued) 

Shelf - Final Programmatic Environmental Assessment, MMS 2004-054 (July 2004).69 Fed. Reg. 45851 (July 30, 

2004). 

19 MMS, Structure-Removal Operations on the Gulf of Mexico Outer Continental Shelf Programmatic Environmental 

Assessment, MMS 2005-013 (February 2005).70 Fed. Reg. 9965 (March 1,2005). 

20 71 Fed. Reg. 50457, 50458 (Aug. 25,2006). 

21 72 Fed. Reg. 24326 (May 2, 2007). 

22 Center for Biological Diversity v. U.S. Department of the Interior, 563 F.3d 466 (D.C. Cir. 2009). 

23 75 Fed. Reg. 16833 (April 2, 2010). Available online at http~Jwww.mms.gov/5-year/PDFslPRP2007-20l2.pdf. On 

that same date, MMS announced intent to prepare an ErS for the next 5-year plan, from 2012 to 2017. 75 Fed. Reg. 

16828 (April 2, 2010). 

24 MMS, Outer Continental Shelf Oil & Gas Leasing Program: 2007-2012, Final Environmental Impact Statement 

MMS Z007-OO3 (hereinafter 5-year Plan EIS). Available online at http~/www.mms.gov/5-year/2007-2012FE[S.htm. 

25 5-year Plan EIS, Ch. IV, pp. IV-28 -IV-31. 

26 5-year Plan EIS, Ch. IV, pp. IV-Z9. 

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tanker).27 These numbers are for deepwater and near-shore drilling combined. Approximately 

75% of the leasing activity is planned for deepwater. 

The programmatic environmental effects for the preferred alternative for the Gulf Coast included . 

impacts on the following: air and water quality; mammals and birds; fish, fisheries, and fish 

habitat; sea turtles; coastal and seafloor habitats; areas of special concern; socio-economic 

impacts; archeological resources; tourism and recreation; and land use.28 Some protected 

resources in the area include the following endangered species: 

• Northern Right Whale 

• Blue Whale 

• Fin Whale 

• SeiWhale 

• Humpback Whale 

• Sperm Whale 

• West Indian Manatee 

• Leatherback turtle 

• Green turtle 

• Hawksbill turtle 

• Kemp's Ridley turtle 

• Loggerhead turtle 

• Gulf Sturgeon 

• Whooping crane 

• Piping plover 

• Alabama beach mouse 

• Choctawhatchee beach mouse 

• St. Andrew beach mouse and 

• Perdido Key beach mouse. 

The baseline data described above largely influences the discussion of environmental impacts 

within this EIS. The data contemplate four platform spills across the entire 40-year lease term 

(and not just the five years of the 5-year Plan) would produce spills of approximately 1,500 bbl 

each, and only three of those spills would be in deepwater. Accordingly, the analysis of the effects 

from the spills are limited to considering how a 1,500 bbl spill could affect the environment. 

There is no extrapolation or other hypothesis for what would happen if the spill were larger. 

Based on the assumptions of limited spill quantities, the conclusion for the environmental 

consequences tends to be in one oftwo camps: one, that the magnitude of harm would depend on 

27 S-year Plan EIS, Table rv-4. 

1S 5-year Plan EIS, Ch. rv, pp. rv-33 to rv-102. 

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The 2010 Oil Spill: MMS lind NEPA 

the timing and quantity ofthe oil spill (see, for example, Coastal Waters, Marine Waters, Marine 

Manunals, Marine and Coastal Birds, Essential Fish Habitat, Sea Turtles); or two, that because a 

deepwater spill is calculated to be at 1,500 bbl, it is unlikely to reach areas where significant 

impacts could occur (see, for example, Marine and Coastal Birds, Terrestrial Mammals, Coastal 

Barrier Beaches, Sea turtle nesting, Seafloor Habitat and Live Bottom and Pinnacle Areas). 

Environmental groups argued that the agency failed to take a hard look at the environmental 

consequences of its action. Limiting the size of a potential spill could limit the size of impacts 

that are reviewed. However, the court that reviewed this matter, the D.C. Circuit Court of 

Appeals,29 has determined that challenges to the sufficiency of that NEPAprocess for the 5-year 

plan could not be reviewed. J() The court said that the 5-year Plan NEPA review had "not yet 

reached that 'critical stage' where an 'irreversible and irretrievable commitment of resources' has 

occurred that will adversely affect the environment. .. 31 The court suggested that the appropriate 

time for such claims would be at the leasing stage. Accordingly, this ruling bars any challenge to 

the 5-year Plan NEPA review. 

This position is consistent with other courts that have reviewed NEPA challenges of multiple 

stage administrative programs. The Second Circuit has held that a federal action, in that case an 

administrative hearing involving Mobil Oil, is not subject to NEPA until that point where there 

might be irreversible and irretrievable commitments ofresources.32 Similarly, the D.C. Circuit 

held that a Forest Service procedure for identifying areas for oil and gas leases was not ripe 

because it could prove unnecessary if no leases were ever issuedY No irreversible or irretrievable 

commitment of resources had been made. 

The EIS for 11 Gulf of Mexico Lease Sales 

In April 2007, MMS also completed the EIS for the 11 lease sales for the Gulf of Mexico, the 

MultisaJe EIS.34 For the lease sales, the MMS divided the Gulf of Mexico into three regions: 

Western (the Texas coast); Central (the coasts of Louisiana, Mississippi and Alabama); and 

Eastern (the Florida coast{. Eleven lease sales were planned for the Western and Central areas and 

none for the Eastern area. 5 A number ofleases could be issued within each of the 11 lease sales, 

2. 43 U.S.C. § I 349(c)(I) gives this court exclusive jurisdiction for review ofOCSLA leasing program approvals. This 

exclusive jurisdiction has been found to apply only to OCSLA claims and not to NEPA claims related to OCSLA 

approval. SaeGet Out Oil, Inc. v. Andrus, 477 F. Supp. 40, 42 (C.D. Cal. 1979). 

30 Center for Biological Divetsity v. U.S. Department of the Interior, 563 F.3d 466 (D.C. Cir. 2009). 

31 Center for Biological Diversity v. U.S. Department of the Interior, 563 F.3d 466,480 (D.C. Cir. 2009). 

32 Mobil Oil Corp. v. FTC, 562 F.2d 170, 173 (2d Cir. 1977) (finding that certain adjudicatory proceedings were not 

subject to NEP A because the final order was still speculative). 

'3 Wyoming Outdoor Council v. U.S. Forest Service, 165 F.3d 43 (D.C. Cir. 1999). See also Conner v. Burford, 848 

F.2d 1441 (9th Cir. I 988)(holding that no EIS was required where lease was issued forbidding surface occupancy (and 

therefore oil drilling». 

34 MMS, Gulf of Mexico OCS Oil and Gas Lease Sales: 2007-2012; Western Planning Area Sales 204, 207, 210, 215, 

and 218; Central Planning Area Sales 205, 206, 208, 213, 216, and 222; Final Environmental Impact Statement, MMS 

2007-018 (April 2007) (hereinafter Multisale ElS). Availahle online at http://www.gomr.mms.govlhomepglregulate/ 

environlnepa/nepaprocess.html#Recent%20NEPA%20Documents. 

" Approximately 5.8 million acres located in the southeastern part of the Central Planning Area (CPA) are not included 

in the lease sale area, despite being opened to leasing by the Gulf of Mexico Energy Security Act of 2006 after years of 

leasing moratoria in appropriations acts. 71 Fed. Reg. 35258 (June 27, 2007). 

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typically over 300, based on the amount of resources an area is estimated to produce. For more 

details on the facts underlying the Western and Central lease sales, see Appendix A. 

The Multisale EIS evaluated the envrronmental impacts from routine operations as well as 

accidents such as oil spills. It reviewed all of the different steps involved in extracting oilseismic testing, exploratory drilling, development and production, transportation, and removing 

structures at the end of the lease. 

Blowouts and other spills were evaluated, first, on the probability of such events occurring, and 

then analyzing the probable resulting environmental effects. Like the 5-year Plan EIS, the 

Multisale EIS used historical data as the basis for the size of an oil spill. According to MMS, the 

most likely size of an oil spill that was greater than 1,000 bbl would be 4,600 bbl.36 However, 

MMS states that large oil spills (meaning spills greater than 1,000 bbl) are "low-probability 

events.,,37 

MMS used modeling to see how a 4,600 bbl spill would dissipate when on the surface. (Although 

it studied both surface and subsurface spills, MMS noted that subsurface spills would behave the 

same as surface spills once they reached the top.) MMS found that natural weathering would 

dissipate 32% to 74% of the slick; between 30% and 32% would be lost to the atmosphere via 

evaporation; and about 2% to 42% would be lost into the water column via natural dispersion.38 

No modeling was done on a larger spill. 

The Multisale EIS did consider the possibility of a larger offshore spill for the leases, although it 

did not analyze impacts from such a spill. It found that a spill larger than 10,000 bbl had greater 

than a 99% chance of occurring during the 40-year period.39 A mean number of spills of that size 

was estimated between 11 and 13 for that time period 40 MMS analyzed the environmental effects 

of a spill of 4,600 bbl, the "most likely size of a spill greater than 1,000 bbl.'.41 

In general, the probability of an offshore oil spill greater than 1,000 bbl (but not larger than 4,600 

bbl) reaching an enviromnentally sensitive resource was found to be small, ranging from less than 

0.5% (for example, reaching Gulf communities, listed beach mice, or Gulf Sturgeon habitat), but 

greater for other resources (for example, the probability of such a spill reaching waters used by 

coastal sea turtles ranged from 6% to 35%, while the odds of a spill reaching sea turtle nesting 

and mating habitat were 4%).42 Thus, an offshore spill larger than 1,000 bbl was not found to be a 

significant environmental impact. 

36 Multisale ElS, p. 4-232. 

31 Multisale EIS, p. 4-228. Ninety-four percent of all spills in the Gulfwere found to be less than I bbl, contributing 5% 

by volume to all spills. Multisale ElS, p. 4-235. 

J8 Multisale EIS, p.4-233. 

39 Multisale ElS, p. 4-75 

40 Id. 

41 Multisale ErS, p. 4-232. 

42 Multisale EIS, p. 4-243. 

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The Multisale EIS includes a discussion of blowouts as a Loss of Well Control (LWC), of which a 

blowout is the most severe form. Most LWC events were found to last half a day.43 Therefore, 

MMS concluded impacts to marine water quality were not estimated to be significant.44 However, 

it is noted that the noise from a blowout explosion could injure marine mammals, depending on 

their proximity.45 

Adequacy of the Environmental Review of the Multiple Lease Sales 

It could be questioned whether the review within the Multisale BIS was comprehensive enough to 

satisfY a court that MMS fully complied with NEPA. The act requires "a detailed statement" on 

"any adverse environmental effects which caunot be avoided should the proposal be 

implemented.,,46 A court could consider the adequacy of not reviewing the environmental effects 

of spills over 10,000 bbl when MMS calculated a greater than 99% probability that such a spill 

would occur. On the other hand, the court could find that reviewing spills of 4,600 bbl met 

NEPA's standards. There is no court decision reviewing this document. 

NEPA requires an agency to consider the environmental consequences of its actions during the 

development of a proposal. 47 Courts apply the "rule of reason" to see if the document is 

sufficient. One court described that review as fmding whether an EIS "contains a reasonably 

thorough discussion of the significant aspects of the probable environmental consequences.,,48 In 

general, courts have held that the goals ofNEPA are satisfied when an BIS "sets forth sufficient 

information to enable the decision-maker to consider fully the environmental factors involved.'049 

In the case of OCS leases, courts have accepted that there are staged analyses with different 

degrees of scrutiny matching the different OCSLA steps. In a suit challenging an EIS prepared for 

one lease sale in the Arctic,50 the plaintiffs argued that the NEPA analysis was flawed because it 

significantly underestimated the amount of oil that might be spilled.5l The Ninth Circuit held that 

they were "least troubled by what may seem to be incomplete or speculative data at the lease sale 

stage," noting that prior to exploration "an oil spill risk analysis can never be more than 

speculative."S2 The court's comfort with the data was based on the fact that OCSLA had tiered 

analyses: "the amount and specificity of information necessary to meet NEPA requirements varies 

at each of OCSLA's stages.,,53 It referred to the U.S. Supreme Court decision regarding the tiered 

environmental analysis ofOCSLA, Secretary of the Interior v. California.54 In that case, which 

43 Multisale EIS, p. 4-239. 

44 Multisale EIS, p. 4-260. 

45 Multisale EIS, p. 4-275. 

46 42 U.S.C. § 4332(2XC)(H). 

'7 Kleppe v. Sierra Club, 427 U.S. 390, 410 (1976). 

"Idaho Conservation League v. Mumma, 956 F.2d 1508, 1519 (9'" Cir. 1992). 

49 County of Suffolk v. Dept oflhe interior, 562 F.2d 1368 (2d Cir. 1977) (holding that an EIS for OCS drilling 

proposal was not inadequate). 

so The Multisale EIS for the Gulf reviewed II lease sales. 

S! Tribal Village of Akutan v. Hodel, 869 F.2d 1185 (9" Cir. 1988). 

52 Id. at 1192. 

" Id. 

54 Secretary of the Interior v. California, 464 U.S. 312 (1984) (holding that an adverse effects analysis under the CZMA 

was not required at the lease sale stage). 

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did not consider NEPA, the Supreme Court said that a lease sale on its own "does not directly 

mandate further activity that would raise an oil spill problem," and therefore, there was no need to 

perform a CZMA environmental analysis at that point.55 The Supreme Court and the Ninth Circuit 

predicated their decisions on the fact that the desired environmental review could occur at a later 

stage in the OCSLA process. 

Other courts have considered the argument that an environmental document at the lease sale stage 

should have considered the potential effects of a larger spill, ultimately rejecting that claim 56 In a 

dispute in the Ninth Circuit, the NEPA document had discussed impacts from spills exceeding 

1,000 barrels and those exceeding 10,000 barrels for OCS drilling in the Arctic. The plaintiff 

wanted consideration of spills of greater than 100,000 bbl, based on the Amoco Cadiz spill of 1.6 

million barrels in 1978, and the 3.5 million bbl exploratory well blowout in the Gulf of Mexico in 

Mexican waters in 1979. The district court held that plaintiff had not made its argument well, 

failing to show how impacts from a 100,000 bbl spill would be different from those discussed for 

a 10,000 bbl spill. Additionally, the court noted that an EIS does not have to consider every 

possible impact: "The rule of reason applicable to environmental impact statements does not 

require an inquiry into every conceivable situation that may occur no matter how remote or 

speculative it may be.,,57 

The Ninth Circuit agreed with the conclusion of the district court, but for different reasons. It 

found that the tiered environmental reviews under the OCSLA would mean that as drilling 

became more likely, the impacts of a 100,000 bbl spill may be considered. The lease sale stage 

was a preliminary stage, according to the court: "Further information about the probability and 

location of a 100,000 barrel spill will become available as lessees survey their tracts, or test them, 

or plan for production and development."s8 

While NEPA requires consideration of a range of alternatives, it does not require consideration of 

a worst case scenario, such as another 3.5 million bbl spill. 59 An earlier version of the CEQ 

regulations did require such an evaluation when an agency had "incomplete or unavailable 

information" regarding the effects of an action. In that case, an agency was required to "include a 

worst case analysis and an indication of the probability or improbability of its occurrence.,,60 In 

general, courts have held that an EIS "is not required to discuss every conceivable consequence of 

an agency's actions. Under the rule of reason, the environmental impact statement is not required 

to consider alternatives or consequences that are only speculative or are too remote.,,61 It would 

" Secretary of the Interior v. California, 464 U.S. 312, 317 (1984). 

56 Village of False Pass v. Watt, 565 F. Supp. 1123 (D.C. Alaska 1983), ajJ'dsub nom., Village of False Pass v. Clark, 

733 F.2d 605 (9th Cir. 1984). 

57 Village of False Pass v. Watt, 565 F. Supp. 1123, 1147 (D.C. Alaska 1983). 

58 Village of False Pass v. Clark, 733 F.2d 605, 616 (9"' Cir. 1984). 

5. Robertson v. Methow Valley Citizens Council, 490 U.S. 332 (\989); Sierra Club v. Sigler, 695 F.2d 957 (5'" Cir. 

1983) (holding the Corps of Engineers did not have to consider the worst case scenario of a tanker losing all of its cargo 

when considering the impacts of a dredging permit basing its holding in significant part on a now-revised CEQ 

regulation). 

60 40 C.F.R. § IS02.22(b) (revised in 1986). The current regulations require an agency to prepare a statement regarding 

unavailable infonnation that includes reasonably foreseeable significant adverse impacts, which is defined as including 

"impacts which have catastrophic consequences, even if their probability of occurrence is low, provided that the 

analysis of the impacts is supported by credible scientific evidence." 

61 Grazing Fields Farm v. Goldschmidt, 626 F.2d 1068, 1074 (I" Cir.1980). 

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be up to a court to consider whether a blowout spill from Lease Sale 206 was too remote and 

speculative for MMS to consider in its environmental review. 

Lease Sale 206 Environmental Assessment 

The third environmental review in the OCS process is the environmental assessment (EA) 

prepared for lease sale 206 in the Gulf (Lease Sale 206 EA).62 The oil spill is occurring in 

Mississippi Canyon Block 252 of this lease sale. MMS prepared environmental assessments for 

other particular lease sales in the Western and Central Gulf, such as Lease Sale 207, although a 

Supplemental EIS was prepared for Lease Sale 224 in the Eastern Gulf. 

Typically, an EA leads to one of two conclusions: discovery of a significant impact and then 

preparation of an EIS, or a finding of no significant impact (FONSI). MMS terms their EAs 

differently. It issues an EA-FONNSI, meaning finding of no new significant impact, reflecting the 

tiered environmental analyses for the OCS process. Lease Sale 206 EA recognizes that it "tiers off 

the Multisale EIS and incorporates much of the material by reference.,,63 According to MMS, new 

information related to the lease sale was discovered, but did not change the conclusions reached 

within the Multisale EIS.64 

The EA appears to back off some of the environmental impacts considered in the EIS. It states 

that because activity was overestimated, the environmental impacts "may have been 

overstated.,,65 While new information was considered within the EA, MMS found it supports the 

conclusions made in the Multisale EIS, and so no new conclusions are made within the EA.66 The 

Lease Sale 206 EArefers to the Multisale EIS review of spills greater than 1,000 bbl.67 No 

reference to larger spills was found, such as a 4,600 bbl spill. In fact, oil spills were discussed in 

more general terms throughout the document than in either of the EISs, which were incorporated 

by reference. 

No legal challenge to the Lease Sale 206 EA has been found. However, challenges to other EAs 

for OCS drilling have been found for EAs issued for particular lease sales in the Arctic. Courts 

have found EAs should be used in these circumstances to determine whether "the new 

circumstance must present a seriously different picture of the environmental impact ofthe 

proposed project from what was previously envisioned.,,68 If those different impacts are found, an 

EIS or Supplemental EIS is warranted. A federal district court considered whether a Supplemental 

ErS should have been prepared three years after conclusion of a multisale EIS for the Arctic 

region, instead of an EA. It found that the multisale EIS in that case had considered scenarios that 

62 MMS, Proposed Gulf of Mexico OCS Oil and Gas Lease Sale 206; Central Planning Area; Environmental 

Assessment, MMS 2007-059 (Oct. 2007) (hereinafter Lease 206 EA). Available online at http://www.gomr.mms.gov/ 

homepgiregulate/environ/nepainepaprocess.html#Recent%20NEPA%20Documents. 

63 EA FON:-lSI, introduction. 

64 EA FONNSI, p. 1. 

65 Lease 206 EA, p. 14. 

66 Lease 206 EA, p. 18. 

67 Lease 206 EA, p. 24. 

68 Sierra Club v. Froehlke, 816 F.2d 205, 210 (S"' Cir. 1987); North Slope Borough v. Minerals Management Service, 

No. 3:07-cv·0045-RRB, "2 (D. Alaska April 12, 2007); Oregon Natural Resources Council v. Devlin, 776 F. Supp. 

1440,1449 (D. Ore. 1991). 

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included the new data addressed by the EA. 69 As this conclusion is fact-specific, it cannot be used 

to predict whether a court may reach the same decision regarding the Lease Sale 206 EA. 

Categorical Exclusion for the Exploration Plan 

The final environmental document to date for the Mississippi Canyon Block 252 oil well is a 

categorical exclusion for the exploration plan (EP) submitted by BP (EP CE). As discussed above, 

a categorical exclusion may be used by an agency when a category of actions has been 

determined to have no significant effect on the environment either individually or cumulatively.70 

The CEQ regulations provide that any procedures allowing CEs must also include "extraordinary 

circumstances" for when a CE would not apply.71 

In 1986, MMS issued its list of categories of activities excluded from further NEPA review within 

the DOl Departmental Manual.72 The list was revised in 2004. The Departmental Manual states 

that a CE does not apply if"the action qualifies as an exception under Appendix 2 of 5 16 DM." A 

copy of the MMS categorical exclusions and the exceptions are available as Appendix B to this 

report.73 

CRS has reviewed the documentation by MMS recording its decision to invoke a categorical 

exciusion for the EP. The documentation is referred to as a Categorical Exclusion Review (CER) 

with Analysis and includes reviews for specific environmental harms. The CE process begins 

when a leaseholder (in this case BP) submits an exploration plan for MMS approva1.74 MMS 

reviews the plan to see if it fits any of the published categorical exclusions. The agency must also 

see whether any exceptions to those CBs apply. The decision must be documented. MMS uses 

forms that include check lists to document the CERs. 

According to MMS, CEs are available when "the impacts from the common operations are 

expected to be negligible to non-existent based upon general information gathered during past 

environmental analyses.,,7> This means that based on its experience, MMS has found that those 

operations have at most negligible environmental impacts, and therefore, additional review is not 

required. 

The CER documents from MMS do not indicate which CE was used. However, it seems likely 

that MMS invoked CE C(10), which is a CE that applies to exploration plans: 

69 North Slope Borough v. Minerals Management Service, No. 3:07-cv"()045·RRB, *2 (D. Alaska April 12, 2007). 

704() C.F.R. § 1508.4. 

,. 40 C.F.R. § 1508.4. 

72 The Federal Regislernotice announcing these CEs refers to them as ooing functions transferred from tbe Geological 

Survey (GS) and 100 Bureau of Land Management (BLM) to the MMS upon its establishment. 51 Fed. Reg. 1855 (Jan. 

15,2986). 

7; It is also available online at htlp:fI206.131.241. I 8Iapp_DMfact.,.getliles.cfm?relnum=3625. 

14 In practice, multiple versions of an EP may be submitted, such as an initial EP, or an amended EP. The CER for BP 

shows separate reviews were conducted for archaeological resources, chemosynthetic communities, and what was 

referred to as a NEPA (I) determination. Copies oftbese documents (either the I·EP (Initial Exploration Plan) with a 

NEPA final date of ApriIIS,2009,ortbe A·EP (Amended Exploration Plan) with a NEPA final date of April 3, 2009) 

are available from the author. 

1S MMS, Discussion of Categorical Exclusion Reviews (undated). A copy of this document is included as Appendix C. 

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Approval of an offshore lease or unit exploration development/production plan or a 

Development Operation Coordination Document in the central or western Gulf of Mexico 

(30 CFR 250.2) except those proposing facilities: (I) In areas of high seismic risk or 

seismicity, relatively untested deep water, or remote areas, or (2) within the boundary of a 

proposed or established marine sanctuary, andlor within or near the boundary of a proposed 

or established wildlife refuge or areas of high biological sensitivity; or (3) in areas of 

hazardous natural bottom conditions; or (4) utilizing new or unusual technology.16 

This CE appears to have been created in 1978 in guidelines for MMS's predecessor. It is the only 

CE that makes specific reference to an OCS area, or, in fact, contains any geographical 

restriction. It excludes two of the four stages OCSLAactions from further NEPAreview. It 

excludes both exploration plans in the western and central Gulf of Mexico and development and 

production plans in those areas. In contrast, the other CEs exclude what appear to be more 

general, administrative activities such as "issuance and modification of regulations, Orders, 

Standards, Notices to Lessees and Operators, Guidelines, and field rules ... " (C)(l); "approval of 

unitization agreements, pooling, or communitization agreements" (C)(4); and "approval of 

suspension of operations and suspensions of productions" (C)( 6). 

The CE for Gulf plans could be based on the OCSLA amendments of 1978.11 Those amendments 

address certain NEPA requirements, giving exemptions to activities in the Gulf of Mexico. The 

relevant section of that law, Section 25 (codified at 43 U.S.C. § 1351(eXI», states that "at least 

once the Secretary shall declare the approval of a development and production plan in any area or 

region ... of the outer Continental Shelf, other than the Gulf of Mexico, to be a major Federal 

action.,,78 While this language contains some ambiguity as to whether the "at least once" 

requirement must be used by the Secretary for all development plans or on a plan-by-plan basis, 

this suggests that approval of a development and production plan in the Gulf of Mexico might 

never need to be declared a major federal action (key words in NEPA to mandate preparation of 

an BIS).79 No similar statutory reference to exploration plans exists, but this may be the 

foundation for excluding Gulf of Mexico plans from environmental analyses. 

BP discussed a Worst Case Scenario Response in its initial EP for Mississippi Canyon Block 252, 

indicating it considered a potential large-scale spill. The EP states that for exploratory wells A and 

B at Block 252, the worst case scenario would be a blowout at the exploratory stage, leading to a 

spill of 162,000 gallons (3,857 bbl) of crude oil a day.80 The EP indicates that BP's regioual oil 

spill response plan for a worst case sceuario had been approved by MMS.81 

76 516 DM l5.4(C)(JO). 

n P.L. 95-372, § 25, 92 Stat. 659 (1978). 

J8 The legislative history for this amendment does not discuss why the Gulf was excepted from this provision. 

However, the Conference Report suggests that the exception was for efficiency: "to limit bureaucratic redtape and 

otherwise minimize delays in the search for and production of oil and gas" which was "going on for a number of years" 

in the Gulf. H. Rep. 95-1474, at 115 (Aug. 10,1978). The Gulf exclusion was within the Senate language, while the 

House had no exclusion. Id. 

1? As referenced earlier in this report, MMS policy is that development and production plans undergo a full ElS. 

However, the MMS allows a CE for development and production plans in the western and central areas of the Gulfof 

Mexico, essentially exempting those plans from that policy. Because it was still in exploration, the Mississippi Canyon 

Block had not reached the stage of development and production. It is not known whether MMS would have issued a CE 

for that plan as well. . 

80 EP, § 7.1. 

"EP, § 7.1. 

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Despite referring to a blowout in the context of a response plan, no blowout scenario was 

included in the EP. This appears to be based on MMS policy for the area. Section 2.7 of the EP 

states: "A scenario for a potential blowout of the well from which BP would expect to have the 

highest volume of liquid hydrocarbons is not required for the operations Eroposed in this EP.,,82 

While MMS regulations require disclosure of a blowout scenario in EPs, 3 MMS provided an 

exception in a 2008 Notice to Lessees. The exception exempts OCS actions in the Gulf from 

blowout scenario requirements under certain conditions.84 

Even if a blowout scenario was not prepared, it seems there would be significant amounts of oil 

released if the worst case scenario of a blowout occurred, oil at quantities greater than considered 

in the Multisale EIS or the Lease Sale 206 EA However, because a CE was used for the EP, 

instead of an EIS or an EA, a review of the environmental impacts for a spill of this size was not 

conducted. They were not considered within the previous EISs or the EA either. 

Adequacy of the Environmental Review of the Exploration Plan 

No court has reviewed this categorical exclusion (516 DM 15.4(C)(10», either to determine 

whether on its face it meets the standards which CEs are to follow-actions that either 

individually or cumulatively are found not to have a significant effect on the environment-or as 

it has been applied to any exploration or development plan. However, the Ninth Circuit 

considered whether MMS had properly used a different CE in California when approving lease 

suspensions. The court found the use of that CE was not adequately justified by MMS.85 In that 

case 36 lease suspensions were sought nearly 30 years after a large oil spill near Santa Barbara. 

Under the OCLSA, MMS may suspend the term of a lease when a lessee is not able to begin 

production within the term of the lease, thus avoiding expiration of the lease. 86 The court found 

that there was no documentation of the CE, and that some exceptions to a CE could have applied 

that MMS did not consider. Accordingly, the court remanded the NEPA review to MMS. 

It is possible a court may find that exceptions to CEs apply in the case ofthe EP CE, in which 

case the BP CE would be invalid. (The exceptions are included as part of Appendix B.) One 

exception that may apply addresses effects on ESA-listed species, meaning a CE could not be 

used if an action may: "have adverse effects on species listed or proposed to be listed on the List 

of Endangered or Threatened Species, or have adverse effects on desiguated Critical Habitat for 

these species."s7 All of the enviromnental documents address the effects of an oil spill on listed 

species and the critical habitat of the Gulf Sturgeon. For example, the Lease Sale 206 EA states 

that over the 40-year term of the lease, 119 loggerhead, 10 leatherback, 1 hawksbill, 13 Kemp's 

S2 BP, Initial Exploration Plan, Mississippi Canyon Block 252, OCS-G 32306 (received by MMS Feb. 23,2009) 

(hereinafter EP). A copy of this document is available from the author. 

"30 C.F.R. § 2S0.213(g). A lawsuit challenging the DOl's issuance of the Notice was filed in federal court. Gulf 

Restoration Network v. Salazar, No. 2:10-cv-OI497 (E.D. La.filedMay 18,2010). 

84 MMS, Notice to Lessee 2008 G4 (May 1, 2008). Available online at hnp:l/www.gomr.mms.gov/homepgiregulate/ 

regsfntlsl2008NTLslOg-g04.pdf. Under this Notice, a blowout scenario is only required for OCS drilling if I) Florida is 

an affected state; 2) the activity occurs within protective zones of Flower Garden Banks or Stetson Bank; 3) activity 

includes installation of surface facility at greater than 400 meters; 4) initial Development Operations Coordination 

Documents (DOCDs) and supplemental DOCDs with new multiwell structures if either Texas or Louisiana is an 

affected state; and 5) initial EPs ifTexas is an affected state. Notice 2008 G4. p. 6. 

85 California v. Norton, 311 F.3d 1162 (9th Cir. 2002). 

86 43 U.S.C. § 1334(a)(1). 

87 516 DM Appx. 2, exception 2.8. 

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ridley, and 38 green turtles will be killed.88 It is possible a court could find that these effects could 

be considered "adverse." Another exception to the CEs addresses actions when the impacts 

cannot be known, perhaps due to the fact that the harm depends on the scale, timing, and location 

of an oil spill: "2.4 - Have highly uncertain and potentially significant environmental effects or 

involve unique or unknown environmental risks." 

Even if the exceptions do not apply, MMS may be required to explain in the CE why they do not. 

Under accepted law, if there is substantial evidence that an exception may apply, an agency must 

document why an exception to a CE does not apply in order to support the CE.89 While the CER 

documents specifically address exceptions regarding archeological resources and chemosynthetic 

communities, finding that neither exception applies, there is no explicit reference to any other 

exception. 

The fact that this project was in the Gulf of Mexico made a difference in the type of review MMS 

conducted. Arguably, a heightened level of review might have reached a different conclusion as to 

the probable environmental impacts. If the EP had been in the Arctic, the CE for the Gulf plans 

would not apply and consideration of a blowout scenario also would have been required. Instead, 

EAs are used, which must sufficiently analyze the environmental impacts of the action. When the 

Ninth Circuit reviewed an EA for an exploration plan in the Beaufort Sea in the Arctic 

(hereinafter the Beaufort Sea EP), it found that an EA was not adequate.90 The BP EP and the 

Beaufort Sea EP are factually similar in that they result from a nearly identical set of tiered NEPA 

analyses. The Beaufort Sea EP also came after an EIS for a 5-year plan (for 2002-2007), an EIS 

for the multiple lease sale, and a series of EAs for particular lease sales. Like the EP CE, 

endangered species were present at the planned drilling site. In the case of the Beaufort Sea EP 

the court indicated experts expressed concern that the exploration plan could have significant 

impacts on polar bears and whales. An EA-FONNSI was issued, meaning no new significant 

impacts were found. The court held that the Beaufort Sea EA did not indicate MMS took a "hard 

look" at the environmental impacts of the exploration plan since substantial questions remained 

regarding the harm to wildlife and the people in the area.9

! MMS revoked its approval of the EP.92 

The EP CE, perhaps, could be justified as a fourth environmental review, implying that all of the 

environmental impacts had been considered in the earlier, more expansive documents. 

Technically, however, that is not how a CE is intended to be applied. The NEPA regulations do 

not provide that CEs may be used to exclude reviews on the basis that previous analyses already 

considered impacts. A CE is supposed to be invoked because the project would not have any 

impacts. :t-.'EPA allows tiered environmental reviews93 when the impacts have already been 

considered. 

Additionally, this rationale runs counter to the OCSLA staging justification used by courts as to 

why environmental reviews at the lease sale stage or earlier did not need to be in depth. Those 

"Lease 206 EA, p. 41. 

,. Jones v. Gordon, 792 F.2d 821 (9'h Cir. 1986). 

90 Alaska Wilderness League v. Kempthome, 548 F.3d 815 (9" Cir. 2008), vocotedos moot. 571 F.3d 859(91h Cif. 

2009) (upon rescission by MMS of the EP approval). 

91 Alaska Wilderness League v. Kempthorne. 548 F.3d 815, 825 (91h Cif. 2008), vacated as moot, 571 F.3d 859(9" Cif. 

2009). 

92 See Alaska Wilderness League v. Kempthome, 571 F 3d 859 (9"' Cir. 2009) . 

• 340 C.P.R. § 1500.4(i). 

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courts held that a more intense environmental review was not needed at the early stages of the 

OCSLA because it would occur when actual drilling was imminent.94 For example, the 

justification used by the District Court of Alaska for why a 100,000 bbl spill did not have to be 

analyzed may not apply when a CE is used at the exploration stage instead of a more in-depth 

analysis: "Congress has decided to allow key decisions having serious environmental 

consequences to be made at the exploration and production and development stages instead of 

requiring all decisions to be made at the pre-leasing and leasing stages.,,95 

The Ninth Circuit's rationale for why a larger oil spill was not examined at the lease sale stage 

was that environmentally significant activities did not occur then. A more thorough review would 

be conducted later: 

by purchasing a lease, lessees acquire no rightto do anything more. Under the plain language 

of OCSLA, the purchase of a lease entails no right to proceed with full exploration, 

development, or production ... the lessee acquires only a priority in submitting plans to 

conduct those activities. If these plans, when ultimately submitted, are disapproved, no 

further exploration or development is permitted.96 

If no review were conducted later, this justification may not seem to be supportable. The Ninth 

Circuit had suggested in another case that the exploration stage was where a spill analysis would 

be most appropriate.97 

The U.S. Supreme Court also emphasized the importance of administrative review of the postlease actions: "an OCS lease authorizes the holder to engage only in preliminary exploration; 

further administrative approval is required before full exploration or development may begin."9S 

It could be argued that the EP CE is the inverse result of what is supposed to happen with tiered 

environmental reviews. Instead of the process described by the courts where the environmental 

review becomes more exacting as the drilling becomes imminent, the opposite has happened and 

no additional environmental analysis was conducted. 

Conclusion 

The exploration well blowout in the Gulf of Mexico appears to have major, and potentially 

catastrophic, environmental effects. None of the environmental reviews under NEPA considered 

an oil spill of this magnitude. However, it is unclear whether that violates NEPA, which has no 

requirement for analysis of a worst case scenario. The use of a categorical exclusion at the 

exploration stage appears to be procedurally correct under MMS policy, provided there were no 

applicable exceptions. However, the legality of that CE has never been examined by a court, 

which could consider whether an exemption from a NEPA review at the point where drilling is 

imminent violates NEPA either because extraordinary circumstances existed in the case, or 

because, in general, the tiered OCSLA process envisioned more scrutiny of environmental 

consequences after the lease stage. 

94 Center for Biological Diversity v. U.S. Department of the Interior, 563 F.3d 466, 480 (D.C. Cir. 2009). 

'5 Village of False Pass v. Watt, 565 F. Supp. 1123 (D.C. Alaska 1983). 

96 Village of False Pass v. Clark, 733 F.2d 605, 608 (9th Cir. 1984). 

91 Tribal Village of Akutan v. Hodel, 869 F.2d 1185, 1192 (9'" Cir. 1988). 

9il Secretaryoftlte Interior v. California, 464 U.S. 312, 321 (1984). 

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Appendix A. Background Facts 

Source: MMS, Gulf of Mexico OCS Oil and Gas Lease Sales: Final Environmental Impact 

Statement (MMS 2007-018) (Apri12007). 

Duration of Gulf of Mexico OCS Oil and Gas Activity-40 years (p. 4-5): 

• Exploratory drilling activity can take place over an 8-year period, beginning 

within one year after the lease sale. 

• Development activity takes place over a 39-year period, beginning with the 

installation of the fIrst production platform and ending with the drilling of the last 

development wells. 

• Production of oil and gas begins by the third year after the lease sale and 

continues through the 40th year. 

• Final abandonment and removal activities occur in the 40th year. 

Amount of oil and gas expected to be produced (p. 4-5): 

Western Gulf: 

• Oil = 242 - 423 million bbl 

• Gas = 1.644 - 2,647 trillion cubic feet 

Central Gulf: 

• Oil = 776 - 1,292 million bbl 

• Gas = 3.236 - 5.229 trillion cubic feet 

Amount of seismic testing expected (p. 4-7): 

• Western Gulf-400 - 800 blocks 

• Central Gulf-I,OOO - 2,000 blocks 

N umber of exploration and delineation wells from this lease sale expected during 40-year 

period (p. 4-10): 

• Western Gulf-42 - 66 

• Central Gulf--65 - 96 

Number of development wells from this lease sale anticipated during 40-year period (p. 4-

13): 

• Western Gulf-I55 - 221 

• Central Gulf-330 - 468 

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Number ofloss of wen control events (including blowouts) from this lease sale estimated 

during 40-year period (p. 4-250): 

• Western Gulf-l - 2 

• Central Gulf-2 - 3 

Number of offshore oil spills estimated from this lease sale during 40-year period (p. 4-241): 

• Western Gulf-SOO - 1,500 spills! 400 - 21,000 bbl of oil 

• Central Gulf-2,700 - 4,500 spillsl 5,500 - 26,500 bbl of oil 

Natural seeps of oil, annual average (1990-1999) (Table 4-12): 

• Western Gulf--490,000 bbl 

• Eastern GuJt9--490,000 bbl 

Probability of spills greater than 10,000 bbl occurring (Table 4-15): 

Western Gulf: 

• Mean number of spills from all sources (facilities, pipelines, shuttle tankers)-3 

• Probability of occurrence-92% - 96% 

Central Gulf: 

• Mean number of spills from all sources (facilities, pipelines, shuttle tankers)-9 

• Probability of occurrence-99+% 

Historical data on offshore spiUs greater than 10,000 bbl in the Gulf of Mexico from 1985-

1999 (Table 4-16): 

• From pipelines: 2 spills; 30,000 bbl spilled in total 

• From platforms: 0 spills 

99 Data not available for Central Gulf. 

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Appendix B. MMS Categorical Exclusions 

Source: 516 DM 

15.4 Categorical Exclusions. In addition to the actions listed in the Departmental categorical 

exclusions outlined in Appendix 1 of 516 DM 2, many of which the MMS also performs, the 

following MMS actions are designated categorical exclusions unless the action qualifies as an 

exception under Appendix 2 of 516 DM 2: 

A. General. 

(1) Inventory, data, and information collection, including the conduct of environmental 

monitoring and nondestructive research programs. 

(2) Actions for which MMS has concurrence or co-approval with another Bureau if the action is a 

categorical exclusion for that Bureau. 

B. Internal Program Initiatives. 

(l) All resource evaluation activities including surveying, mapping, and geophysical surveying 

which do not use solid or liquid explosives. 

(2) Collection of geologic data and samples including geologic, paleontologic, mineralogic, 

geochemical, and geophysical investigations which does not involve drilling beyond 50 feet of 

consolidated rock or beyond 300 feet of unconsolidated rock, including contracts therefor. 

(3) Acquisition of existing geological or geophysical data from otherwise private exploration 

ventures. 

(4) Well logging, digital modeling. inventory of existing wells, and installation of recording 

devices in wells. 

(5) Establishment and installation of any research/monitoring devices. 

(6) Test or exploration drilling and downhole testing included in a project previously subject to 

the NEPA process. 

(7) Insignificant revisions to the approved 5-year leasing program. 

(8) Prelease planning steps such as the Call for Information and Area Identification. 

C. Permit and Regulatory Functions. 

(1) Issuance and modification of regulations, Orders, Standards, Notices to Lessees and 

Operators. Guidelines and field rules for which the impacts are limited to administrative, 

economic, or technological effects and the environmental impacts are minimal. 

(2) Approval of production measurement methods, facilities, and procedures. 

(3) Approval of off-lease storage in existing facilities. 

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(4) Approval of unitization agreements, pooling, or communitization agreements. 

(5) Approval of commingling of production. 

(6) Approval of suspensions of operations and suspensions of production. 

(7) Approval of lease consolidation applications, lease assignments or transfers, operating rights, 

operating agreements, lease extensions, lease relinquishments, and bond terminations. 

(8) Administration decisions and actions and record keeping such as: 

(a) Approval of applications for pricing determinations under the Natural Gas Policy Act. 

(b) Approval of underground gas storage agreements from a presently or formerly productive 

reservoir. 

(c) Issuance of paying well determinations and participating area approvals. 

(d) Issuance of drainage determinations. 

(9) Approval of offshore geological and geophysical mineral exploration activities, except when 

the proposed activity includes the drilling of deep stratigraphic test holes or uses solid or liquid 

explosives. 

(10) Approval of an offshore lease or unit exploration. development/production plan or a 

Development Operation Coordination Document in the central or western Gulf of Mexico (30 

CFR 250.2) except those proposing facilities: (I) In areas of high seismic risk or seismicity, 

relatively untested deep water, or remote areas, or (2) within the boundary of a proposed or 

established marine sanctuary, andlor within or near the boundary of a proposed or established 

wildlife refuge or areas of high biological sensitivity; or (3) in areas of hazardous natural bottom 

conditions; or (4) utilizing new or unusual technology. 

(11) Approval of minor revisions of or minor variances from activities described in an approved 

offshore exploration or development/production plan, including pipeline applications. 

(12) Approval of an Application for Permit to Drill (APO) an offshore oil and gas exploration or 

development well, when said well and appropriate mitigation measures are described in an 

approved exploration plan, development plan, production plan, or Development Operations 

Coordination Document. 

(13) Preliminary activities conducted on a lease prior to approval of an exploration or 

development/production plan or a Development Operations Coordination Plan. These are 

activities such as geological, geophysical, and other surveys necessary to develop a 

comprehensive exploration plan, development/production plan, or Development Operations 

Coordination Plan. 

(l4)Approval of Sundry Notices and Reports on Wells. 

(15) Rights-of-ways, easements, temporary use permits, and any revisions thereto that do not 

result in a new pipeline corridor to shore. 

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D. Royalty Functions. All functions of the Associate Director for Royalty Management including, 

but not limited to, such activities as: approval of royalty payment procedures, including royalty 

oil contracts; and determinations concerning royalty quantities and values, such as audits, royalty 

reductions, collection procedures, reporting procedures, and any actions taken with regard to 

royalty collections (including similar actions relating to net profit and windfall profit taxes). 

Exceptions To Categorical Exclusions 

516 DM 2 Appendix 2 

The following exceptions apply to individual actions within categorical exclusions (CX). 

Environmental documents must be prepared for actions which may: 

2.1 Have significant adverse effects on public health or safety. 

2.2 Have adverse effects on such unique geographic characteristics as historic or cultural 

resources, park, recreation or refuge lands, wilderness areas, wild or scenic rivers, sole or 

principal drinking water aquifers, prime farmlands, wetlands, floodplains or ecologically 

significant or critical areas, including those listed on the Department's National Register of 

Natural Landmarks. 

2.3 Have highly controversial environmental effects. 

2.4 Have highly uncertain and potentially significant environmental effects or involve unique 

or unknown environmental risks. 

2.5 Establish a precedent for future action or represent a decision in principle about future 

actions with potentially significant environmental effects. 

2.6 Be directly related to other actions with individually insignificant but cumulatively 

significant environmental effects. 

2.7 Have adverse effects on properties listed or eligible for listing on the National Register of 

Historic Places. 

2.8 Have adverse effects on species listed or proposed to be listed on the List of Endangered 

or Threatened Species, or have adverse effects on designated Critical Habitat for these 

species. 

2.9 Require compliance with Executive Order 11988 (Floodplain Management), Executive 

Order 11990 (protection of Wetlands), or the Fish and Wildlife Coordination Act. 

2.10 Threaten to violate a Federal, State, local or tribal law or requirement imposed for the 

protection of the environment. 

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Appendix C. The MMS Categorical Exclusion 

Review Process 

Source: Minerals Management Service 

Amore detailed discussion of Categorical Exclusion Reviews (CERs) and the NEPAprocess for 

review ofIndustry Submittals follows: 

Descriptions for the "NEPA Determination Type" field under FastFacts? 

The NEPA Determination Type is identified in a NEPA Determination Type Review at the 

very beginning of the Categorical Exclusion Review (CER) process and it establishes the level of 

NEPA analyses that should be conducted for a particular proposal. Based upon details about the 

proposed action, policy, and programmatic NEPAanalyses, the NEPADetermination Type could 

be either: 

• CER with no further Analyses; i.e., finalize the CER with no additional 

reviews/conditions of approval (COAs) 

• CER with Analyses; i.e., continue processing/review under a CER with the 

applicable protected resource reviews assigned; or 

• Prepare an Environmental Assessment (EA) or an Environmental Impact 

Statement (EIS) 

When it's a categorical exclusion [review] with analysis, what kind of analysis is it? 

Though not a document in the same sense as an EA or EIS, the CERs ultimately consist of a 

series of procedures and activity-specific reviews that are conducted and compiled so that MMS 

is assured that the activity can remain Categorically-Excluded from review under an EA or EIS. 

The CERs are completely digital and therefore, stored within TIMS as part of the Administrative 

Record along with all documentation related to the proposed action (in this case, the EPs on 

MC252) and all associated surveys/reports. Even though Central and Western Gulf of Mexico 

drilling and production activities are Categorically-Excluded from any additional review, MMS 

GOMR prepares CERs on each proposal to ensure that "extraordinary circumstances" do not 

exist and to ensure that the agency has the ability to consider the best-available data/technology 

on a case-by-case basis, which in tum affords real-time adaptive management of assessment 

triggers, reviewing standards, and conditions of approval/mitigation. 

When an exception criteria [now called an "extraordinary circuntStllnce "] is identified 

during analysis. what exactly does that mean? 

An "extraordinary circumstance" (EC) is an identified condition that could exist within an action 

that could be Categorically-Excluded from additional NEPAanalysis. MMS has 12 ECs identified 

under 43 CFR § 46.215 (see last page) that it reviews the proposed action against to determine if 

any of the activities proposed by the operator may "trigger" or cause an EC condition to occur. If 

an EC is identified for a proposal that cannot be avoided (either in the NEPA Determination 

Review or protected resource reviews), an EA must be prepared. The EA. in turn, could result in a 

Finding of Significant Impact (FOSI), which would then require preparation of an EIS. 

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Detailed Discussion: 

The DOl and MMS can categorically-exclude (CatEx) certain actions from further NEPA 

analyses if it is determined that they would not have a significant effect on the environment 

(individually or cumulatively). The MMS CatEx list is currently found in the Departmental 

Manual (see 516DMI5.4) and it not only contains administrative actions, but also common OCS 

operations. The impacts from the common operations are expected to be negligible to nonexistent based upon general information gathered during past environmental analyses about the 

type of activities, the area of the proposed action, programmatic NEPA analyses (Program/Sale 

EISs/EAs), and the past actions as conducted and observed. The specific MMS operational CatEx 

corresponding to the submittal of an Exploration Plan (EP) is below: 

MMS Categorical Exclusion 

under 516 DM 1504 

C. Permit and Regulatory Functions. 

10. Approval of an offshore lease Or unit exploration plan (EP), development/production plan (DPP), or a 

Development Operation Coordination Document (DOCD) in the central or western Gulf of Mexico (30CFRlSO.2) 

except those proposing facilities: 

In areas of high seismic risk or seismicity, relatively untested deep water, or remote areas, or 

within the boundary of a proposed or established marine sanctuary, andlor within or near the boundary of a 

proposed or established wildlife refuge or areas of high biological sensitivity; or 

in areas of hazardous natural bottom conditions; or 

utilizing new or unusual technology. 

Since the CatEx list is based upon general/historical information and generalized/programmatic 

information, GOMR goes the extra step and prepares a Categorical Exclusion Review (CER) for 

each action to determine if site-specific details of the proposed operations will not result in an 

Extraordinary Circumstance (EC), which would require that an EA be prepared. Coordinators in 

GOMR's Environmental Compliance Section (ECS) follow a set of submittal-specific SOPs and 

utilize a detailed GIS application, PMT GIS, that addresses the activity being proposed and 

compares information with established business ruleslEC triggers based upon the specific 

resources to determine if the action should be reviewed under an Environmental Assessment (EA) 

and which, if any, protected resource reviews should be assigned for the CERIEA. 

When the NEPAcoordinator is finished following the SOP, their NEPADetermination Review 

and associated PM[ GIS report will identify the Initial NEPA Determination Type, which could 

include; 

• CER with no further Analyses; i.e., finalize the CER with no additional 

reviews/conditions ofapprovaJ (COAs) 

• CER with Analyses; i.e., continue processing/review under a CER with the 

applicable protected resource reviews assigned; or 

• Prepare an EAlEIS. 

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All of the applicable information related to the NEPA Determination andlor any resource reviews 

is recorded in the Technical Information Management System (TIMS) and the PM[ GIS Report is 

attached in the respective NEPA Determination Type Review. A copy of the plan/application is 

provided to the NEPA Decision Maker for a concurrence review of the TIMS information and 

PM[ GIS Report. If the Decision Maker concurs with the coordinator, NEPA Determination 

Type is also recorded in TIMS for the specified submittal. If the Chief has any questions about 

the NEPA determination type, the information will be reviewed together until a decision can bc 

made. 

Once concurrence is given, all necessary reviews are assigned to resource specialists (i.e., marine 

archaeologists, benthic biologists, meteorologists, oceanographers, etc.) and tracked in TIMS. 

The SME informs the NEPA Coordinator if additional information or a clarification is required 

andlor when the review is completed. The completed review will note one of the following: 

• The proposed action will have no impact on the protected resource. 

• The proposed action requires a condition of approval (COA) to ensure that an 

extraordinary circumstance (EC) will not be met/triggered. 

• The proposed action may cause a significant impact and an EA is recommended. 

When all of the applicable reviews are completed, the SME's conclusions, and any suggested 

conditions of approvaVmitigation (if necessary), are recorded in TIMS and compiled by the 1\'EPA 

Coordinator for presentation to the NEPA Decision Maker, The NEPA decision maker will review 

the findings and choose from the follow~ng Final NEPAActions: 

• CER Approved; (Action can be CatExed with no COAs-an EC will not be 

triggered/ occur); or 

• CER Approved; (Action can be CatExed with COAs-to ensure that an EC will 

not be triggered/occur); 

• Prepare an EAJEIS. 

43 CFR § 46.215 Categorical Exclusions: Extraordinary circumstances 

Extraordinary circumstances (see paragraph 46.205(c» exist for individual actions within 

categorical exclusions that may meet any of the criteria listed in paragraphs (a) through (1) of this 

section. Applicability of extraordinary circumstances to categorical exclusions is determined by 

the Responsible Official. 

• Have significant impacts on public health or safety. 

• Have significant impacts on such natural resources and unique geographic 

characteristics as historic or cultural resources; park, recreation or refuge lands; 

wilderness areas; wild or scenic rivers; national naturallandrnarks; sole or 

principal drinking water aquifers; prime farmlands; wetlands (EO 11990); 

floodplains (EO 11988); national monuments; migratory birds; and other 

ecologically significant or critical areas. 

• Have highly controversial environmental effects or involve uuresolved conflicts 

concerning alternative uses of available resources [NEPA section 102(2)(E)]. 

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• Have highly uncertain and potentially significant environmental effects or 

involve unique or unknown environmental risks. 

• Establish a precedent for future action or represent a decision in principle about 

future actions with potentially significant environmental effects. 

• Have a direct relationship to other actions with individually insignificant but 

cumulatively significant environmental effects. 

• Have significant impacts on properties listed, or eligible for listing, on the 

National Register of Historic PJaces as determined by the bureau. 

• Have significant impacts on species listed, or proposed to be listed, on the List of 

Endangered or Threatened Species or have significant impacts on designated 

Critical Habitat for these species. 

• Violate a Federal law, or a State, local, or tribal law or requirement imposed for 

the protection of the environment. 

• Have a disproportionately high and adverse effect on low income or minority 

populations (EO 12898). 

• Limit access to and ceremonial use ofIndian sacred sites on F ederallands by 

Indian religious practitioners or significantly adversely affect the physical 

integrity of such sacred sites (EO 13007). 

Contribute to the introduction, continued existence, or spread of noxious weeds or non-native 

invasive species known to occur in the area or actions that may promote the introduction, growth, 

or expansion of the range of such species (Federal Noxious Weed Control Act and EO 

13112).Contribute to the introduction, continued existence, or spread of noxious weeds or nonnative invasive species known to occur in the area or actions that may promote the introduction, 

growth, or expansion of the range of such species (Federal Noxious Weed Control Act and EO 

13112). 

Author Contact Information 

Kristina Alexander 

Legislative Attorney 

kalexander@crs.loc.gov, 7-8597 

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