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Regan Nelson’s Blog

The House oil spill legislative package: An important step forward for oceans

Regan Nelson

Posted July 29, 2010

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On Monday, House leadership unveiled their legislative response to the Gulf oil disaster.  Incorporating the work of several committees, the CLEAR Act is a comprehensive reform bill and an important step forward in improving our nation’s ability to prevent and respond to oil spills.  It includes provisions to increase safety, help restore the Gulf Coast, crackdown on ethical lapses, require businesses to be responsible for their actions, and close royalty loopholes to ensure the American people receive their fair share for the extraction of public resources.

After hearing this week that a new oil spill is now contaminating my hometown via the Kalamazoo River, and that another blowout has occurred in the already impacted Louisiana waters, the necessity of passing strong legislation seems even more urgent.  The CLEAR Act directly responds to the Deepwater Horizon disaster while also looking forward and attempting to prevent the next catastrophe.

Several members of Congress have introduced strengthening amendments to the CLEAR Act.  Below is a brief description of the Titles I, II, V, VI and VII, along with strengthening amendments that NRDC strongly supports.  We urge members of Congress to support the CLEAR Act with the strengthening amendments described below, and to reject any weakening amendments or efforts to send the bill back to committee.

Title I:  Restructuring of the Minerals Management Service

Title I abolishes the Minerals Management Service (MMS) and replaces it with three new entities to administer both onshore and offshore energy development:  the Bureau of Energy and Resource Management (to administer leasing of conventional and renewable energy), the Bureau of Safety and Environmental Enforcement (to carry out enforcement of regulations to ensure safety and environmental compliance) and the Office of Natural Resources Revenue (to collect revenues derived from energy development).  Each of the Bureaus and the Office of Natural Resources Revenue would be headed by a Director that is appointed by the President and confirmed by the Senate.

Within the Bureau of Energy and Resource Management, the CLEAR Act also establishes an independent science office to conduct the environmental assessments required under law.  While we applaud the formation of an independent science office, we have concerns about whether an office that reports to the Director in charge of leasing is really all that independent.  A hallmark of effective reform of offshore oil and gas regulation is the application of scientifically valid, unbiased, and credible environmental information to all stages of planning, leasing, and regulation.

  • NRDC supports Rep. Hime’s amendment to establish a Director to head the independent science office, to require the Secretary or other appointing officer to give committees of jurisdiction in House and Senate 30 days notice before the effective appointment of the Director, and to require the Secretary to list and make available any documents that the Office of Environmental Science or Bureau of Safety and Environmental Management has produced relevant to the decision to issue a 5-year leasing program, a specific lease for oil and gas exploration, or a regulation related to oil and gas exploration.  These steps will lead to better assurances that science will play a strong role in decisions regarding offshore oil and gas activity.

Another important goal of MMS reorganization should be to facilitate the development of renewable energy.  Renewable energy projects need to undergo thorough environmental reviews, but those exercises raise very different scientific and technical issues than do reviews of oil and gas development. A small, nimble unit in the Secretary’s office would help address the bottlenecks in the current oversight system, which can now result in an eight- to ten-year licensing and permitting period for offshore wind projects.

  • NRDC supports Rep. Pingree’s amendment to establish a separate office of offshore renewable energy in the office of the Interior Secretary to aid in the goal of building a robust renewable energy industry which has significant potential to create jobs related to the manufacturing, installation and maintenance of these offshore devices.

Title II – Amendments to Federal Policy on Oil and Gas Development

The amendments to the Outer Continental Shelf Lands Act (OCSLA) proposed in Title II of House package contain a number of important reforms to help safeguard our ocean and marine resources, and prevent and respond to oil spills.     

Of note, the bill:

  • Re-orients the national OCS policy to ensure oil and gas development is more balanced with environmental protection.
  • Requires the Interior Department to consult with and consider recommendations from NOAA, our nation’s ocean agency, on decisions related to leasing.
  • Disqualifies bad actors from bidding on leases on our nation’s OCS.
  • Provides for additional consideration of environmental factors in the nation’s OCS leasing program, and requires further study of leased areas to help minimize environmental impacts.
  • Includes strong new safety standards for offshore drilling, including independent certifications of critical equipment, demonstrations of the ability to respond to future blowouts or major spills, stiffer penalties for safety violations, and an end to the practice of issuing environmental waivers for drilling plans.
  • Increases oversight and inspection of offshore facilities.
  • Gives the Presidential Commission tasked with investigating the Deepwater Horizon incident subpoena power to ensure they have all the tools they need to fully evaluate the disaster.

These are very important provisions.  But additional provisions are needed to fully safeguard our marine and coastal resources from the impacts of oil and gas development on the OCS.

  • NRDC supports  Rep. Polis’s amendment to update OCSLA’s Judicial Review section to reflect ensure review opportunities of OCS activities with applicable environmental and natural resources laws (MMPA, ESA, etc).
  • NRDC supports Rep. Polis’s amendment to add analysis of the cumulative impact of drilling on marine mammals, not just project by project analysis, to an environmental impact study.
  • NRDC supports Rep. Holt’s amendment to expedite leasing and permitting for the first generation of offshore wind projects by clarifying the Secretary of the Interior’s authority to issue provisional leases, easements and rights-of-way.

Title V – Gulf of Mexico Restoration

Title V establishes a Gulf of Mexico Restoration program to provide a coordinating structure for the short and long-term restoration that will be required to restore the Gulf of Mexico from the impacts of the BP Gulf oil spill disaster.  There are also strong provisions directing the Secretary of Commerce to establish a comprehensive marine environmental monitoring and research program to study the affect of oil and chemical dispersants on the environment.

  • NRDC supports Rep. Holt’s amendment to ensure scientific information gathered on the impacts of oil spills on trust resources is available for the Secretary of Commerce to use for their required consultation with the Secretary of the Interior.  This amendment will ensure that the very good data collected by the Commerce Department is put to good use.

Title VI – Regional Coordination and Planning

As the number of ways that we use our oceans and coastal areas increases, so must the nation’s ability to plan for these uses become more integrated, and coordinated and be based on sound science.  Title VI provides a strong starting point by establishing Regional Councils, composed of federal agencies and stakeholders, to conduct baseline assessments that inform spatially-explicit Regional Strategic Plans.  Such plans are intended to ensure that decisions about where offshore activities occur are made with an intent to reduce user conflicts and protect our ocean and coastal resources.

Title VI also establishes an Ocean Resources Conservation and Assistance (ORCA) Fund, which takes a small portion of revenues from oil and gas activities, and directs them to activities that protect, maintain, or restore our oceans through direct allocations to coastal States, and through a competitive grant program for governments, research institutions and non-profits.  The ORCA Fund would also help pay for critically important research being conducted to better understand and monitor our oceans – a clear need made especially evident as a result of the Gulf oil disaster.

NRDC is strongly supportive of Title VI. 

Title VII – Oil Spill Accountability and Environmental Protection

Title VII contains a number of provisions to hold the oil industry accountable for actions that harm our communities, our coasts and our marine resources.  Most importantly, a provision is included to increase the liability limits and financial responsibility requirements on offshore facilities, so that oil and gas companies must cover 100 percent of the oil pollution cleanup costs and damages caused by oil spills they create.  However, a loophole that would allow responsible parties to potentially thwart their responsibilities by claiming bankrupty needs to be closed.

  • NRDC supports Rep. Connolly’s amendment to close a legal loophole to ensure that oil companies will be held responsible for the oil spill liability of a bankrupted subsidiary.

Title VII also contains several positive amendments to the Oil Pollution Act, which was passed into law after the Exxon Valdez disaster in Alaska.  There is a provision that would require responsible parties to provide information to the President as demanded, so information like the flow-rate of an oil spill would be required to be delivered to the government on demand.  The Oil Pollution Act also governs the Natural Resource Damage Assessment (NRDA) process, which establishes the liability of the responsible party for damages to the environment.  This process determines how the responsible party will restore the natural environment after an oil spill. 

  • NRDC supports Rep. Hime’s amendment to direct that following initial clean-up of a spill, National Resources Damages Act trustees will give equal and full consideration to all statutorily prescribed natural resource damage remedies to ensure that acquisition of non-impacted land is considered an equal remedy and not given lower priority.
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