U.S. Oil Spill Panel Urges Increased Safety Steps

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"For credibility, this group can't lobby

The White House oil spill commission on Thursday challenged offshore drillers to step up their safety standards and detailed a proposal calling for creation of an independent self-regulating industry group.

Created in the aftermath of the BP drilling accident in the Gulf of Mexico, the commission said the entire offshore oil industry needs to increase its focus on safety and such a group could help hold companies accountable.

"The oil and gas industry needs to embrace a new safety culture," commission co-chair Bill Reilly said at the start of a two-day meeting to prepare for the commission's final report. "Good management could have prevented this catastrophe.

The panel is considering pushing for creation of a self-regulating safety organization for offshore drilling akin to the U.S. nuclear sector's Institute of Nuclear Power Operations to help enforce industry standards.

At Thursday's meeting, commission staff said such a group would be able to perform an independent auditing function and should be empowered to dole out rewards and sanctions that would help the industry overcome complacency.

Any safety institute set up by the industry should not be operated by a trade advocacy group, such as the American Petroleum Institute, the panel's staff presentation said.

"For credibility, this group can't lobby," said Nancy Kete, a senior advisor to the panel on corporate safety and risk management.

Also, to be effective the institute must be accompanied and complimented by a strong federal regulator, the staff said.

"There are fundamental weaknesses in the U.S. regulatory approach" to offshore drilling, said commission co-chair Bob Graham at the start of Thursday's meeting. Graham said the government must develop better policies and strategies to ensure the safety of drilling operations.

To encourage participation in a safety institute, some commissioners said it may be necessary to require membership before firms can drill in areas deemed risky by regulators.

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