U.S. To Issue Rules on Decommissioning Oil Rigs

The former Director of the Bureau of Ocean Energy Management (BOEM) said on March 6 that the Obama administration will soon issue new rules governing the decommissioning of old offshore oil infrastructure. Tommy Beaudreau spoke at the Offshore Technology Conference in Houston and said BOEM would publish a notice of new rules this summer. BOEM is the agency that regulates offshore oil and gas drilling, and is housed within the Department of Interior.

“This will be an open, transparent process (on) how we meet these challenges around aging infrastructure and decommissioning,” Beaudreau said, according to Fuel Fix.

Beaudreau said that existing laws concerning decommissioning old offshore oil infrastructure, such as oil platforms and pipelines, are insufficient. Offshore oil drilling in the Gulf of Mexico is as active as ever, but many of the rigs and pipelines are aging. Drillers prefer to use rigs as long as possible, as the daily costs of operating are high.

But Beaudreau also went to lengths to calm concerns from the industry.

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“I know in an environment where costs are always a key concern for you — including rising operating costs — conversations around decommissioning costs can be uncomfortable and maybe even a little painful,” Beaudreau said. “But it’s something we all need to own up to and face up to.”

He noted that the notice that the agency will publish in the summer is only the beginning of a long process before regulations are finalized. He said BOEM would work with the oil and gas industry to ensure the rules work well, and he wants the industry “to provide us feedback on the types of issues we need to be thinking about in the context of decommissioning.”

Tommy Beaudreau is now the Chief of Staff to Secretary of Interior Sally Jewel.

By James Burgess of Oilprice.com