New Budget to Boost BSEE’s Offshore Regulatory Programs (USA)

President Obama announced yesterday that he has requested $222.1 million for the Bureau of Safety and Environmental Enforcement (BSEE) for fiscal year 2014, which would provide critically needed resources to strengthen the agency’s offshore regulatory programs. The proposal, which represents a $24.8 million increase over the 2012 enacted level, would enable BSEE to carry out its responsibilities for oil spill response planning and safety inspections; investigations, environmental enforcement and compliance; as well as production permitting and development.

As the Administration works to expand domestic energy production through the President’s all-of-the-above strategy, BSEE continues to take the necessary steps to provide effective oversight of oil and gas development on the U.S. Outer Continental Shelf, helping lead the offshore oil and gas industry toward a culture of safety and environmental responsibility.

“The President’s 2014 request will enable BSEE to keep pace with a dynamic industry as operators continue to pursue new technologies that enable them to develop our nation’s energy resources in deeper water and frontier areas,” said BSEE Director Jim Watson. “The President’s request provides the necessary resources for BSEE to institutionalize the regulatory reforms put into place following the Deepwater Horizon explosion and oil spill and continue to build upon the organizational requirements necessary to ensure offshore oil and gas activities are conducted safely and in an environmentally responsible manner.”

The President’s request will be offset by $124.0 million from offsetting collections, including $65.0 million from inspection fees, $50.6 million from rental receipts and $8.4 million through cost recovery fees.

BSEE continues to promote a strong safety culture across the offshore oil and gas industry beginning with the introduction of a hybrid regulatory system, which incorporates for the first time performance-based standards with prescriptive regulations. BSEE improved the Safety and Environmental Management System program (SEMS) requirements through the recently finalized SEMS II rule. Operators will be required to implement these strengthened requirements in 2014, and BSEE staff will be working with them throughout the audit and review process to ensure compliance.

Promoting the use of information, including Real Time Monitoring (RTM), to enhance safety and environmental protection is a key priority for BSEE in 2014. Many companies already use RTM technology and dedicated offsite facilities to monitor their offshore oil and gas operations. The Bureau is actively reviewing the use of various forms of RTM in its regulatory processes as BSEE seeks to better fulfill its mission. Additionally, the Bureau is developing a strategic, risk-based approach to compliance and enforcement.

The budget request also provides the necessary resources to BSEE’s Alaska Region as companies begin looking to develop oil and gas resources in this frontier area. The request builds independent and dependable inspection capabilities to support expanded drilling activities in addition to building the critical engineering capacity for permitting operations.

The Bureau will continue focusing its efforts on recruiting and training a diverse and talented workforce. In 2014, the Bureau will expand recruitment and retention programs and develop cutting edge training curricula.”

The FY 2014 request is a continuation of the Obama Administration’s plan to complete the reorganization of the former Minerals Management Service and establish a base operating level consistent with the recommendations from the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling and the National Academy of Engineering.