Deepwater Drilling Ban Lifted by New Orleans Federal Judge

Deepwater Drilling Ban Lifted by New Orleans Federal Judge

By Laurel Brubaker Calkins and Margaret Cronin Fisk – Jun 22, 2010
U.S. Deepwater Drilling Ban Lifted

Cranes load and unload ships normally used for offshore drilling operations in the Gulf of Mexico in Port Fourchon, Louisiana. Photographer: Derick E. Hingle/Bloomberg

A New Orleans federal judge lifted the six-month moratorium on deepwater drilling imposed by President Barack Obama following the largest oil spill in U.S. history. Drilling services shares jumped on the news.

Obama temporarily halted all drilling in waters deeper than 500 feet on May 27 to give a presidential commission time to study improvements in the safety of offshore operations. More than a dozen Louisiana offshore service and supply companies sued U.S. regulators to lift the ban. The U.S. said it will appeal the decision.

U.S. District Judge Martin Feldman today granted a preliminary injunction, halting the moratorium. He also “immediately prohibited” the U.S. from enforcing the ban. Government lawyers told Feldman that ban was based on findings in a U.S. report following the sinking of the Deepwater Horizon rig off the Louisiana coast in April.

“The court is unable to divine or fathom a relationship between the findings and the immense scope of the moratorium,” Feldman said in his 22-page decision. “The blanket moratorium, with no parameters, seems to assume that because one rig failed and although no one yet fully knows why, all companies and rigs drilling new wells over 500 feet also universally present an imminent danger.”

Separate Order

“The court cannot substitute its judgment for that of the agency, but the agency must ‘cogently explain why it has exercised its discretion in a given manner,’” Feldman said, citing a previous ruling. “It has not done so.”

Feldman in a separate order today “immediately prohibited” the U.S. from enforcing the drilling moratorium, finding the offshore companies would otherwise incur “irreparable harm.”

White House press secretary Robert Gibbs said that “continuing to drill at these depths without knowing what happened does not make any sense.”

Transocean Ltd., which leased the Deepwater Horizon to BP Plc, jumped as much as 3.5 percent in New York trading after the decision was announced. Hornbeck Offshore Services Inc., which brought the suit, surged as much as 11 percent.

The U.S. argued that the moratorium was necessary to assure public safety.

“We need to make sure deepwater drilling is as safe as we thought it was the day before this incident,” Brian Collins, a lawyer for the government, told Feldman in a court hearing June 21. “It is crucial to take the time because to fail to do so would be to gamble with the long-term future of this region.”

Biggest Quantity

BP has two pipes collecting oil and gas from the ocean floor. They collected 25,830 barrels of oil yesterday, the biggest quantity diverted from the Gulf of Mexico since the April 20 spill began, London-based BP said in a statement. BP spokesman David Nicholas declined to comment on the ruling, saying the company was not a party to the case.

Lawyers for the drilling companies told Feldman the moratorium illegally sidesteps a required industry comment period. They also said regulators failed to tell Obama that all active deepwater rigs passed an immediate re-inspection after the Deepwater Horizon exploded and sank, with only two rigs reporting minor violations and the rest getting approval to continue operations.

Henry Dart, special counsel for the Louisiana attorney general, told Feldman that federal regulators failed to consult with state officials about the impact of the drilling ban, allegedly violating U.S. law.

Jobs in Danger

“Even after the catastrophic events of Sept. 11, the government only shut down the airlines for three days,” Louisiana said in court papers seeking to lift the ban.

Lawyers for the state and oilfield companies told Feldman that the ban could cost as many as 20,000 jobs if the moratorium lasted 18 months.

“The defendants trivialize such losses by characterizing them as merely a small percentage of the drilling rigs affected, but it does not follow that this will somehow reduce the convincing harm suffered,” Feldman said. He said the economic impacts of the ban would “clearly ripple throughout the economy of this region.”

Feldman granted the injunction after finding it likely the oilfield companies will succeed in proving “the agency’s decision was arbitrary and capricious,” which violates federal law governing policy decisions.

‘Immeasurable’ Effect

“An invalid agency decision to suspend drilling of wells in depths over 500 feet simply cannot justify the immeasurable effect on the plaintiffs, the local economy, the Gulf region, and the critical present-day aspect of the availability of domestic energy in the country,” Feldman said.

“Today’s ruling by U.S. District Court Judge Martin Feldman is an important step in returning thousands of oil service workers to their jobs,” Royal Dutch Shell Plc spokesman Bill Tanner said in an e-mailed statement.

“Shell remains confident in its expertise and procedures to safely drill and complete deepwater wells.” Shell’s safety standards often exceed regulatory requirements and include including a rigorous training program for well engineers, Tanner said.

Kjersti Torgersen, a spokeswoman for Statoil ASA in Houston, did not immediately respond to a telephone call seeking comment. Todd M. Hornbeck, CEO of Hornbeck Offshore, didn’t immediately return a call for comment.

Little Change

Realistically, not a lot has changed, said Jud Bailey, an analyst at Jefferies & Co. in Houston.

“It’s a small victory for the industry, but clearly the administration has dug in its heels and is going to try to keep this moratorium, come hell or high water,” Bailey said today in a telephone interview. “Investors, as it relates to the drillers, are for the most part staying away. There’s too much uncertainty, too much headline risk.”

Bailey said he doesn’t think many operators would run out and immediately try to resume operations. “You run the risk of this getting overturned by the appellate court,” he said.

The case is Hornbeck Offshore Services LLC v. Salazar, 2:10-cv-01663, U.S. District Court, Eastern District of Louisiana (New Orleans).

Obama spill panel big on policy, not engineering

Obama spill panel big on policy, not engineering

By SETH BORENSTEIN, AP Science Writer Seth Borenstein, Ap Science Writer Sun Jun 20, 12:02 am ET

WASHINGTON – The panel appointed by President Barack Obama to investigate the Gulf of Mexico oil spill is short on technical expertise but long on talking publicly about “America’s addiction to oil.” One member has blogged about it regularly.

Only one of the seven commissioners, the dean of Harvard’s engineering and applied sciences school, has a prominent engineering background — but it’s in optics and physics. Another is an environmental scientist with expertise in coastal areas and the after-effects of oil spills. Both are praised by other scientists.

The five other commissioners are experts in policy and management.

The White House said the commission will focus on the government’s “too cozy” relationship with the oil industry. A presidential spokesman said panel members will “consult the best minds and subject matter experts” as they do their work.

The commission has yet to meet, yet some panel members had made their views known.

Environmental activist Frances Beinecke on May 27 blogged: “We can blame BP for the disaster and we should. We can blame lack of adequate government oversight for the disaster and we should. But in the end, we also must place the blame where it originated: America’s addiction to oil.” And on June 3, May 27, May 22, May 18, May 4, she called for bans on drilling offshore and the Arctic.

“Even as questions persist, there is one thing I know for certain: the Gulf oil spill isn’t just an accident. It’s the result of a failed energy policy,” Beinecke wrote on May 20.

Two other commissioners also have gone public to urge bans on drilling.

Co-chairman Bob Graham, a Democrat who was Florida governor and later a senator, led efforts to prevent drilling off his state’s coast. Commissioner Donald Boesch of the University of Maryland wrote in a Washington Post blog that the federal government had planned to allow oil drilling off the Virginia coast and “that probably will and should be delayed.”

Boesch, who has made scientific assessments of oil spills’ effects on the ecosystem, said usually oil spills are small. But he added, “The impacts of the oil and gas extraction industry (both coastal and offshore) on Gulf Coast wetlands represent an environmental catastrophe of massive and underappreciated proportions.”

An expert not on the commission, Granger Morgan, head of the engineering and public policy department at Carnegie Mellon University and an Obama campaign contributor, said the panel should have included more technical expertise and “folks who aren’t sort of already staked out” on oil issues.

Jerry Taylor of the libertarian Cato Institute described the investigation as “an exercise in political theater where the findings are preordained by the people put on the commission.”

When the White House announced the commission, Interior Secretary Ken Salazar and others made compared it with the one that investigated the 1986 Challenger accident. This one, however, doesn’t have as many technical experts.

The 13-member board that looked into the first shuttle accident had seven engineering and aviation experts and three other scientists. The 2003 board that looked into the Columbia shuttle disaster also had more than half of the panel with expertise in engineering and aviation.

Iraj Ersahaghi, who heads the petroleum engineering program the University of Southern California, reviewed the names of oil spill commissioners and asked, “What do they know about petroleum?”

Ersahaghi said the panel needed to include someone like Bob Bea, a prominent petroleum engineering professor at the University of California, Berkeley, who’s an expert in offshore drilling and the management causes of manmade disasters.

Bea, who’s conducting his own investigation into the spill, told The Associated Press that his 66-member expert group will serve as a consultant to the commission, at the request of the panel’s co-chairman, William K. Reilly, Environmental Protection Agency chief under President George H.W. Bush.

Adm. Hal Gehman, who oversaw the Columbia accident panel, said his advice to future commissions is to include subject matter experts. His own expertise was management and policy but said his engineering-oriented colleagues were critical to sorting through official testimony.

“Don’t believe the first story; it’s always more complicated than they (the people testifying) would like you to believe,” Gehman said. “Complex accidents have complex causes.”

The oil spill commission will not be at a loss for technical help, White House spokesman Ben LaBolt said.

For one, he said the panel will draw on a technical analysis that the National Association of Engineering is performing. Also, members will “consult the best minds and subject matter experts in the Gulf, in the private sector, in think tanks and in the federal government as they conduct their research.”

That makes sense, said John Marburger, who was science adviser to President George W. Bush.

“It’s not really a technical commission,” Marburger said. “It’s a commission that’s more oriented to understanding the regulatory and organizational framework, which clearly has a major bearing on the incident.”

___

Online:

Executive order creating the commission: http://tinyurl.com/spillpanel

White House announcement on commissioners: http://tinyurl.com/25g39t4

Frances Beinecke’s blog archive: http://tinyurl.com/3p86vx

The BP Oil Disaster: Big Government’s Dream Come True

The BP Oil Disaster: Big Government’s Dream Come True

Posted By Rich Trzupek On June 17, 2010 @ 12:59 am In FrontPage | 52 Comments

If you thought President Obama’s address to the nation this week would have focused on the Deepwater Horizon oil spill that is destroying the Gulf Coast economy, you would have been only partially correct. The president did mention what he called the “menacing cloud of black crude,” but the heart of his remarks was a political speech that attacked the president’s political enemies while pushing for a stock “green” agenda, including cap-and-trade legislation, that had no obvious connection to the menace in the Gulf Coast. What was supposed to be a leveling with the American people about the oil crisis became an impromptu pitch for Big Government.

The president’s political feint, while disappointing to anyone who was hoping for solutions to contain the ongoing disaster, was not entirely surprising. A significant portion of the Left is almost giddy about the disaster, because in their minds it demonstrates that industry is dangerously under-regulated and thus provides the all the evidence they need to further extend the long arm of government into aspects of the economy and industry that aren’t even remotely related to oil drilling.

Thirty one years ago the Three Mile Island incident, which didn’t actually hurt anyone [1], effectively shut down the nuclear power industry in the United States. Environmental activists hope to achieve much more in the wake of Deepwater Horizon: to not only stop American off-shore drilling, but to use the disaster to apply a bureaucratic strange-hold on American industry in general. The focus of the president’s address to the nation about the spill proves the point. He didn’t appear half as worried about the disaster in the Gulf as he did about passing cap and trade.

He probably won’t get that legislation, judging by the disgusted reaction of lawmakers [2] on both sides of the aisle, but there are other ways to sabotage the energy sector and the administration is hard at work doing just that. Last week, the Obama administration’s already over-the-top Environmental Protection Agency proposed new rules to regulate non-utility power generation that go beyond extreme and enter the realm of the ludicrous. But, with the shadow of Deepwater Horizon hanging over America, the EPA has a very good chance of pushing them through. An oil spill, it seems, excuses every bureaucratic excess that progressives can imagine. Scores of sources – from the boilers that provide heat to college campuses to the boilers that power ethanol plants, paper mills and food processing plants – will find it impossible to comply with EPA’s proposed boiler regulations and these rules will give bureaucrats unprecedented authority to decide how these industries are run.

The proposed rules are supposed to set new limits on emissions of potentially toxic materials from power plants. The regulation is generically known as “Boiler MACT [3],” with the acronym standing for “Maximum Achievable Control Technology.” However, what USEPA Administrator Lisa Jackson has proposed goes well beyond the toxic realm, with the Agency attempting to use these rules as a back-door way of regulating greenhouse gases and to give Big Government a role in making operational decisions.

A little history is in order. When the Clean Air Act first came into being in its present form in 1970, the EPA was directed to develop rules limiting potentially toxic emissions based solely on risk. That is, if the Agency determined that a particular compound was being emitted in quantities sufficient to present an actual health hazard, then the EPA should develop rules to limit emissions of such a compound. Using this approach, the EPA developed rules to limit emissions of seven potentially toxic materials. This upset environmental groups, who accused the EPA of shirking their responsibilities. That wasn’t true, the Agency simply couldn’t find significant risk anywhere else, but not matter: the environmentalists demanded change, and change they got.

When the Clean Air Act was amended in 1990, the EPA was directed to limit emissions of 188 potentially toxic materials [4], using a technology-based approach. Very little actual science went into selecting those 188 (now 187) compounds, but the list made the Sierra Club and similar groups happy and that’s all that mattered. Under the new approach, the Agency was directed to evaluate how industries were controlling toxics, to determine the top twelve per cent doing the best job and to use these top twelve per cent to set the standard for each compound. Thus, the philosophical question behind controlling potentially toxic air pollutants shifted from “what should we do?” to “what can we do?” The EPA calls those the requirements developed using the top twelve per cent approach “MACT” and scores of industries [5] have their own MACT, outlining the way each is supposed to control potentially toxic materials and setting numerical emissions standards.

Boiler MACT, covering the industrial sector, was first proposed in 2003 under the Bush Administration. The Sierra Club challenged it in court and EPA was directed to rewrite it. The problem that the Sierra Club had with Boiler MACT did not so much involve substance as it did style. They weren’t happy with the form of the regulation, or how the universe of regulated sources was defined. No surprise there, George W. Bush’s EPA could have proposed shutting down every coal-fired power plant in the United States and the Sierra Club would have still said that he didn’t “go far enough” to protect the environment. That’s always the green mantra when a member of the GOP occupies the White House. None-the-less, everyone expected that the “new” version of Boiler MACT would look a lot like the old one, just with more data to back it up, more justification with regard to affected sources and reformatted (but still impossible for an average Joe to understand) language. And, up until recently, that’s what EPA staffers led the regulated community to believe would happen.

But Jackson’s EPA proposed something quite different and disturbing. It effectively abandoned the “top twelve percent” formula, choosing instead to use laboratory detection limits to set limits in many cases. In other words, under EPA’s proposal industrial boilers many potentially toxic pollutants will have to be controlled so tightly that they won’t be able to find what they’re looking for. That’s one step removed from setting emissions limits at zero, and just about as unrealistic and unachievable a goal.

The proposal also requires industrial boiler operators to implement a government-approved energy management program. This program will contain multiple elements, including: a review of available architectural and engineering plans, facility operation and maintenance procedures and logs, and fuel usage; a list of major energy conservation measures; a comprehensive report detailing the ways to improve efficiency, the cost of specific improvements, benefits, and the time frame for recouping those investments; and a facility energy management program developed according to the EPA’s Energy Star [6] guidelines for energy management.

One can argue, and Lisa Jackson’s EPA surely will, that getting the government involved in energy efficiency – i.e., how boilers are run – can affect the amount of potentially toxic emissions a facility puts out, but that’s a very thin argument, especially when the rule in question already contains draconian limits. Energy efficiency requirements are rather a backhand way of achieving the Obama administration’s goal of reducing greenhouse gas emissions, without having to go through the tiresome process of addressing “climate change” directly. Further, we’re only talking about industrial boilers here. The EPA is still formulating MACT rules that will affect the big, electricity-producing utility boilers [7] that are far more significant in terms of size and greenhouse gas emissions than the industrial sector.

Can there be any doubt that this radical EPA will ask the power industry to accept equally unachievable limits and submit to even more government control? As far as this administration and progressives are concerned, the disaster in the Gulf is justification enough for every excess that Big Government can dream up.

Obama wants 15 Million Dollars for “Expert” Oil Commission

Obama wants 15 Million Dollars for “Expert” Oil Commission

June 17th, 2010

By Connie Hair, Human Events

Obama’s Oil Commission to cost 15 million?

-The White House asked Congress late Wednesday for $15 million — a whopping $2.5 million per month for six months — to fund their expert commission of academics to study the Gulf oil-rig explosion and the disastrous spill that followed.

In a letter to Congress, which was obtained by HUMAN EVENTS, White House Budget Director Peter Orszag requested the money to fund the work of the “National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling.”

While tens of thousands are put out of work by Obama’s six-month Gulf deep water drilling moratorium — and people lose generational legacies of work pulling their livelihoods out of the sea with their bare hands from fishing nets and crab traps — the president is spending more money in a month on his academic commission to study the issue than any one of these hard working families will make in a lifetime of real work.

Read More

What took so long?

What took so long?

Thomas Lifson

Times truly have changed. The RNC (!) has come up with a hard-hitting ad holding President Obama accountable for his desultory management of the Gulf crisis. The more Americans who see this, the better.
Video

That Stench of Rotting Bull is Just Obama’s Oval Office Speech

That Stench of Rotting Bull is Just Obama’s Oval Office Speech

Posted By Jeff Dunetz On June 16, 2010 @ 5:03 am In Environment, Federal Spending, News, Obama, Politics, Regulation, taxes |

Putting aside for a second the fact that this speech was given about 50 days late, last night’s oval office speech proved that the President is not ready to be honest with the American people.  For the first 30 days of this crisis, President Obama was ignoring the fact that the crisis existed, and now when he uses the oval office to give the people confidence that he is on top of the problem  he spends more time trying to sell cap and trade than discussing capping the well. Essentially, he is still ignoring the crisis.

Lets take a look at the key points of the President’s speech. He begins by trying to convince America that he has been doing a great job at managing the disaster:

“…  I assembled a team of our nation’s best scientists and engineers to tackle this challenge – a team led by Dr. Steven Chu, a Nobel Prize-winning physicist and our nation’s Secretary of Energy. Scientists at our national labs and experts from academia and other oil companies have also provided ideas and advice.”

Nobel prizes have not been impressive since  Obama recived one for doing nothing and Al Gore got one for a hoax.  The key is how the ideas from those great minds are implemented. The President’s management of the crisis has been horrible.  Even the progressive bible  the NY Times [1] trashed Obama’s  management of the crisis:

“The information is not flowing,” Senator Nelson said. “The decisions are not timely. The resources are not produced. And as a result, you have a big mess, with no command and control.”

In other words,  the leadership and management coming from the executive branch of the government has been a disaster.

Read the rest of this entry »

Obama’s disaster of a disaster speech

Obama’s disaster of a disaster speech

posted at 8:48 am on June 16, 2010 by Ed Morrissey

Usually when I catch a political speech after its delivery, I read the speech before reading its reviews.  Yesterday, our Green Room contributor Sarjex came into town with her partner and had dinner with us after a brief appearance on yesterday’s TEMS, so I didn’t get a chance to do any of it until very late last night.  When I did read it, it shocked me at just how bad and tone-deaf Obama’s address was — and when I watched it on video, his delivery was even worse.

Andrew Malcolm has a great review that should be read in full, but here is a key point:

But watching the president and hearing him was a little creepy; that early portion of the address was robotic, lacked real energy, enthusiasm. And worst of all specifics. He was virtually detail-less.

After almost two months of waiting through continuously contradictory reports, an anxious American public wanted to know, HOW are you going to accomplish all this?

Even Obama’s cheerleaders over at MSNBC were complaining. “Where was the How in this speech?”demanded Keith Olbermann. Seriously.

Everyone’s assumed that fixing the leak was a given since Day Four, which was still five days before the Democrat got his big plane and presidential entourage down there. …

Trust me, the president said, tomorrow I’m going to give those BP execs what-for. As CBS’ Mark Knoller notedon his Twitter account, the president has allotted exactly 20 whole minutes this morning — 1,200 fleeting seconds — to his first-ever conversation with the corporation responsible for the disaster.

Then, he’s got an important lunch with Joe “I Witnessed the World Cup’s First Tie” Biden.

This speech was suited for Day 1 of a catastrophe, not Day 57.  It had no answers at all.  None.  It’s as if Rip van Obama awoke after eight weeks of slumber and had been told just that morning about a massive problem in the Gulf of Mexico.  For a man who has repeatedly claimed to be “fully engaged since Day 1,” and who repeated that claim last night, Obama gave every impression of still being in the spitballing stage of crisis management.

Obama didn’t even offer an original thought for spitballing.  In his short presidency, Obama has had two responses to any issue: appoint a czar or create a commission.  The auto industry got a czar, for instance, and the deficit that Obama’s spending has driven out of sight got a commission.  Last night, Obama wanted people to know he was taking this seriously by appointing a czar and a commission, the latter of which had been announced weeks ago.  That was the sum total of his substantive response last night.  Small wonder Obama chose an Oval Office speech rather than face another press conference.

During the 2008 campaign, we repeatedly criticized Obama’s lack of executive experience, but perhaps even Obama’s critics might be surprised to see how badly Obama has performed in this crisis.  He has nothing left to offer; Obama is running on empty.  In the face of a crisis that has unfolded for almost two full months, Obama chose to talk about wind turbines.  A nation waited to see if a leader would emerge from the White House, and instead it got an absent-minded professor desperate to change the subject.

Even Obama’s supporters have begun to see what his critics have long known: Obama is an empty suit.  His sorry performance last night showed just how little he understands his job, the situation, and the expectations of the American people.