U.S. Issues New Regulations on Offshore Drilling

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"Fundamental change to guide all future leasing, development decisions."

The Interior Department issued new safety and spill-response regulations for offshore O&G drilling Thursday. The new rules—governing blowout preventers, safety certification, well design, emergency response and worker training—clarify the terms under which drilling will resume after the moratorium. The BP spill, resulting in the worst environmental disaster in American history, killed 11 workers and spewed nearly 5M barrels of oil into the Gulf.

Interior Secretary Ken Salazar presented the new rules Thursday, calling them a fundamental change in offshore operations that will guide all future leasing and development decisions in the gulf, the Arctic and elsewhere.

Salazar expects oil companies to complain: "We'll hear from industry that the regulations are too onerous, but the fact is, it's a new day. There is the pre-April 20th framework of regulation and the post-April 20th framework, and the oil and gas industry better get used to it, because that's the way it's going to be."

The secretary pointedly refused to say when or under what conditions he would lift the ban.

"We will lift it. . .when we're ready, and not based on political pressure from anyone."

The moratorium on deepwater drilling is scheduled to end Nov. 30, but officials have signaled it could be eased before then.

Michael Bromwich, director of the Bureau of Ocean Energy Management, Regulation and Enforcement, which now polices offshore drilling, will deliver a report to Salazar Thursday providing a blueprint to safely resume drilling. He said it may be weeks or months before his agency grants permits for the 33 idled deepwater rigs in the Gulf to resume drilling. Drillers must first provide spill-response plans detailing certification of critical equipment like blowout preventers.

The agency is also undertaking a new environmental assessment of the impact of Gulf drilling on the ecosystem, potentially causing further delays.

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