Oil Spill Legislation Pt. 2 June 22, 2010Posted by Jamie Friedland in Congress, Offshore Drilling, Politics.
Tags: Bernie Sanders, Big Oil, BP, Chellie Pingree, Chuck Schumer, Congress, Frank Lautenberg, House of Representatives, John Conyers, Lisa Murkowski, Mark Begich, Offshore Drilling, Oil, Pat Leahy, Senate
Now that I have devoted two recent posts to what Congress isn’t doing, it’s time once again to look at what little they actually are working on. There are a couple of interesting pieces of oil spill legislation that have been introduced recently. These are the most noteworthy:
Let’s start with the bad ones.
S. 3461, introduced by David Vitter (R-LA) on 6/9. This bill would create a system for resolving claims against BP, which is fine. But it also seeks to renegotiate BP’s lease on “Mississippi Canyon 252” (where Deepwater Horizon was drilling when it sank).
Lease renegotiation is the Republicans’ preferred vehicle to increase BP’s liability. It has two main problems:
1) It requires BP’s cooperation. In order for this to work, BP would have to say, “Ok, we admit unlimited liability.” As TPM reported, BP could refuse or even simply walk away from the renegotiation talks. Public pressure might prevent them from doing this, but there is no guarantee. And certainly no good reasons to choose this over just lifting the liability cap, which takes us to the second point.
2) Lease renegotiation establishes no future precedent for oil spills. It is the legislative embodiment of not learning from our mistakes. If we pass this bill and no other, the $75 million liability cap will still be on the books when the next catastrophic oil spill occurs. This is why the only cosponsor on this bill is oil industry lackey Lisa Murkowski (R-AK). Her co-sponsorship indicates that this bill is supported by the oil industry, which in turn indicates that this bill is far too weak.
Also, it could violate the Constitution.
S. 3497, introduced by Scott Brown (R-MA) on 6/16. This bill would “require leases under the Outer Continental Shelf Lands Act to include a plan that describes the means and timeline for containment and termination of an ongoing discharge of oil.” The actual legislative text is not available yet, so I don’t know exactly what this bill would require, but that this seems weak to me. Oil companies saying “and it’ll take us 4 months to fix this thing if it blows” would seem to satisfy the requirements of this bill, nor does this appear to address the strength and efficacy of the oil company plans – is there anything in here to prevent them from submitting plans to protect walruses in the Gulf of Mexico again?
Scott Brown has offered no evidence that his is to be trusted on energy/environmental issues. That being said, he has found a bipartisan cosponsor for this bill in Dianne Feinstein (D-CA), so we will have to wait and see what is actually in this bill.
Now, the good stuff:
S. 3514: Amends the Outer Continental Shelf Lands Act to prohibit anyone from buying an oil or gas lease unless they pay into an Oil Spill Recovery Fund (unspecified amount so far) or post a bond equal to half of their outstanding liability related to oil spills or cleanups. If the payment into the recovery fund is low, then what appears to be the intent of the bill – prevent companies in BP’s current situation from expanding their operations before paying up for oil spills – may be undercut. But the legislative language is not available yet, so we’ll see. Introduced by Mark Begich (D-AK) on 6/21 with 2 cosponsors.
S. 3492: In light of negligent emergency planning and the failure of all other containment options, this bill would amend the Outer Continental Shelf Lands Act to require leaseholders to prepare for and actually drill at least one relief well concurrent to the drilling of any exploratory well in the Outer Continental Shelf (OCS). The bill allows for “alternative measures” at least as effective as a relief well to be employed instead of a relief well as authorized by the Secretary of the Interior. Probably unlikely to pass, but an interesting idea. Introduced by Frank Lautenberg (D-NJ) on 6/15 with no cosponsors yet.
H.R. 5513: “Spilled Oil Royalty Collection Act.” Oil companies pay royalties on each barrel of oil produced. In the “unforeseeable” event of a deepwater oil spill (defined as depth > 200m), this bill would charge oil companies royalties of at least 12.5% on every barrel that comes out of the well, regardless of whether that oil is recovered, burned, “dispersed”…anything. This bill would come into effect retroactively, right before the Deepwater Horizon explosion. Were this to become law, it would further highlight the importance of accurate flow estimates for gushers. Those royalties would certainly not offer much more deterrent than legal liability, but can you think of any reason that spilled oil should be exempted from royalties? I can’t. Especially because they are recovering and selling some of it. Introduced by Chellie Pingree (D-ME) on 6/10 and has 2 cosponsors.
H.R. 5503: Amends the 90-year-old “Death on the High Seas Act” to make it easier for those such as the families of the 11 workers who died in the Deepwater Horizon explosion to sue for non-pecuniary losses such as pain and suffering. The bill was introduced with a statement that read, “We should not allow reckless corporations to use 19th century laws to shortchange their victims.” Sounds right to me. Introduced by John Conyers (D-MI) on 6/11 and has 12 cosponsors.
The companion bill in the Senate (S. 3463) was introduced by Patrick Leahy (D-VT) first, on 6/8, and has 5 cosponsors.
S. 3478: Would repeal parts of the Limitations of Liability Act of 1851, which Transocean has invoked to attempt to cap its liability at about $27 million. This bill wins my personal award for Most Forced Acronym as its name is the “RESTORE Act,” which is supposed to stand for “Remuneration for Ecological and Societal Tolls Occasioned by Reckless Errors.” Introduced by Chuck Schumer (D-NY) on 6/10 and has 3 cosponsors.
Bills to raise the liability cap:
S. 3472: “Big Oil Bailout Prevention Unlimited Liability Act.” Completely lifts the standing $75 million liability cap for oil spills. Introduced by Robert Menendez (D-NJ) on 6/9 and has 24 cosponsors.
H.R. 5520: Requires BP to pay at least $25 billion to a fund like the escrow the White House negotiated, but goes further by excluding this spill from the liability cap. Introduced by Steve Kagen (D-WI) on 6/14 and has 32 cosponsors.
Bills to lift the deepwater drilling moratorium, which I fully support and have defended at length.
S.3489: Introduced by David Vitter (R-LA) on 6/15 and has 1 cosponsor.
H.R. 5499: Introduced John Mica (R-FL) on 6/11 and has 13 cosponsors.
H.R. 5525: Introduced by Pete Olson (R-TX) on 6/15 and has 28 cosponsors.
H.R. 5519: Introduced by Bill Cassidy (R-LA) on 6/14 and has 43 cosponsors, including some notable Gulf Democrats such as Charlie Melancon (D-LA). Apparently Bill is more popular than John and Pete.
Sanders Amendment Defeated
Also worth mentioning but filed again under what Congress isn’t doing: Sen. Bernie Sanders (I-VT) introduced an amendment to cut $35 billion in oil and gas royalties that don’t even add anything to the industry and would instead use $25 billion to reduce the deficit and $10 billion to encourage energy-efficient buildings. The amendment was first blocked by climate-denier Sen. Jim Inhofe (R-KY) and then defeated in a vote, 61-39.
Full list of oil spill questions and answers here.