Perino whitewashes Bush drilling regulation failures

Responding to Democrats who have cited the Bush administration while discussing problems currently facing the U.S., including the Gulf oil spill, Dana Perino stated on Fox News, “They know that that is not true,” and challenged them to “name one regulatory piece that was repealed during the Bush administration that led to this or that.” However, the federal offshore drilling regulator under the Bush administration relaxed regulatory standards and was plagued by ethics scandals.

Perino scoffs at those citing Bush administration in discussions of the Gulf oil spill

Perino says it's “ridiculous” and “offensive” that Democrats are “blaming” Bush administration for the oil spill crisis. During the June 14 edition of Fox & Friends, former Bush press secretary Dana Perino suggested that it is “not true” that the Bush administration is partly to blame for drilling regulation failures:

KILMEADE: So there you have it on the Sunday shows as if the president Bush left yesterday, he's blaming. I mean, does President Bush have to go back, or someone like yourself go back and say what you inherited?

PERINO: Well, you know, we could, but I think that the American people by now they've -- it's gone from being, ok, yeah, we get it, you're blaming them to being ridiculous to now just being offensive and I think they look so small. And I think about those leaders -- they know that that is not true. They know that there are answers to every single one of those things and they chose not to talk about them.

And if you -- if one of those reporters had had the guts to say name one, name one regulatory piece that was repealed during the Bush administration that led to this or that. And instead they don't ask them about their role in the housing crisis or in the banking crisis. And I think I'm pretty sure that there are a lot of Democrats suggesting that we also try to drill for our own resources here in America because we have a national security and national economic security situation when it comes to our oil resources so it's just ridiculous.

KILMEADE: Right. Dana, also there's been at least 30,000 different wells drilled over the last 50 years in the Gulf. There's never been any accidents. Because one happens, it's George Bush's fault?

PERINO: Right. That's why it sounds so ridiculous. And I think, you know, if it was children that parents would fight - you know, children fighting in the back seat of a road trip, I think the parents would finally turn around and say, shut up or we're going to kick you out of the car.

MMS under Bush admin. loosened regulation of drilling, downplayed risk, ignored safety warnings

MMS adopted regulation stating drillers are “in the best position to determine the environmental effects of its proposed activity.” The Washington Post reported on May 25 that the actions taken by the Interior Department's Minerals Management Service, the agency that regulates offshore drilling, “are shaped in part by a 2005 regulation it adopted that assumes oil and gas companies can best evaluate the environmental effects of their operations." The article stated that "[t]he rule governing which information the MMS should receive and review before signing off on drilling plans states: 'The lessee or operator is in the best position to determine the environmental effects of its proposed activity based on whether the operation is routine or non-routine.'" Rolling Stone magazine reported that these “new rules” “pre-qualified deep-sea drillers” to receive an “exemption from environmental review,” even though such exemptions were “originally intended to prevent minor projects, like outhouses on hiking trails, from being tied up in red tape.”

In April 2008, MMS loosened rules requiring blowout plan. The Associated Press reported on May 5 that “A rule change two years ago by the federal agency that regulates offshore oil rigs allowed BP to avoid filing a plan specifically for handling a major spill from an uncontrolled blowout at its Deepwater Horizon project.” AP further reported: “The MMS rule change, made in April 2008, says that Gulf rig operators are required to file a blowout scenario only if one of five conditions applies. For example, an operator must provide a blowout scenario when it proposes to install a 'surface facility' in water deeper than 1,312 feet. While Deepwater Horizon was operating almost 5,000 feet below the surface, [BP spokesman William] Salvin said the project did not meet the definition of a surface facility. The MMS official agreed.”

MMS 2007 environmental impact assessment for BP lease dismissed risk of massive oil spill. The Washington Post reported on May 5: “While the MMS assessed the environmental impact of drilling in the central and western Gulf of Mexico on three occasions in 2007 -- including a specific evaluation of BP's Lease 206 at Deepwater Horizon -- in each case it played down the prospect of a major blowout." The Post stated that “In one assessment, the agency estimated that 'a large oil spill' from a platform would not exceed a total of 1,500 barrels and that a 'deepwater spill,' occurring 'offshore of the inner Continental shelf,' would not reach the coast. In another assessment, it defined the most likely large spill as totaling 4,600 barrels and forecast that it would largely dissipate within 10 days and would be unlikely to make landfall." According to the Times-Picayune, these assessments “paved the way for BP to assert that its plans for drilling in Lease Sale 206 posed no real dangers”:

Before the lease of the oilfields in 2008, the MMS wrote a generic Environmental Impact Statement for the entire northern and western Gulf of Mexico that made the catastrophic well blowout that happened April 20 seem like a near impossibility.

MMS produced its blanket Environmental Impact Statement for 11 proposed leases, mostly off the Louisiana and Texas coasts. One of those planned sales was Lease Sale 206, which gave BP the right to drill at what is known as Mississippi Canyon 252 with a Transocean oil rig called Deepwater Horizon.

The MMS assessed everything from the possible impact of noise on marine life to the specific vulnerabilities of sea turtles and sturgeon, but through it all, the agency assumed any oil that might be spilled would be minimal and any leak would be quickly shut off.

The document states that small oil spills and leaks from pipelines and ships are relatively common and have little effect on the environment. In fact, thousands of natural seeps in the sea floor combine to pump much more oil into the Gulf of Mexico each year than the current manmade leak has produced, but they are spread all over the sea in amounts that quickly dissipate, according to the study.

When it comes to the type of oil well blowout that happened April 20, MMS was downright dismissive. The agency determined that fewer than six of every 10,000 wells would have a blowout that caused any oil to spill. Blowouts are “rare events of short duration,” the study stated, and “the infrequent subsurface blowout that may occur on the Gulf OCS (Outer Continental Shelf) would have a negligible effect on commercial fishing.”

That paved the way for BP to assert that its plans for drilling in Lease Sale 206 posed no real dangers.

MMS failed to respond to 2004 warning about vital piece of blowout preventer. The Wall Street Journal reported on May 3 that "[f]ederal regulators learned in a 2004 study that a vital piece of oil-drilling safety equipment may not function in deep-water seas but did nothing to bolster industry requirements. The equipment, called shear rams, is supposed to seal off out-of-control oil and gas wells by pinching the pipe closed and cutting it." The Journal further reported that "[e]xperts theorize the rams may have failed to work as expected in the Deepwater Horizon disaster."

MMS ignored warnings about faulty cementing in wells. The Associated Press reported on May 24 that numerous MMS reports identified “poor cement job” as the cause of offshore accidents, including incidents that took place in 2005 and 2007, "[y]et federal regulators give drillers a free hand in this crucial safety step." AP noted that rig owner Transocean and “independent experts” have pointed to “faulty cement work” as a possible cause of the blowout, and that new rules “in the works long before the Deepwater Horizon” took effect June 3, which “take a conservative watch-and-wait approach and demand only routines already carried out around the industry: a management program with monitoring and diagnostic testing.”

"WSJ: In 2003, MMS decided not to require last-resort shut-off device. ABC News reported on April 30 that in 2000 MMS “issued a safety alert that called added layers of backup 'an essential component of a deepwater drilling system.'” However, according to the Wall Street Journal, “The industry argued against” mandating a remote-control shut-off switch that serves as “last-resort protection against underwater spills,” and "[b]y 2003, U.S. regulators decided remote-controlled safeguards needed more study. A report commissioned by the Minerals Management Service said 'acoustic systems are not recommended because they tend to be very costly.'" The Journal noted that the Deepwater Horizon rig did not have a remote-control device, which is required “in two major oil-producing countries, Norway and Brazil,” and that "[i]ndustry consultants and petroleum engineers said that an acoustic remote-control may have been able to stop the well, but too much is still unknown about the accident to say that with certainty."

NPR similarly reported that Michael Saucier, MMS regional director in New Orleans, said at a hearing, “I think it was around 2001, there were some draft rules concerning secondary control systems for BOP stacks, and those rules were then sent up to headquarters to continue through the process.” The NPR report goes on to state, “But what came back from headquarters were not rules, he said, just notices that 'highly encouraged' companies to use the backup systems. 'There is no enforcement on it,' he said.”

MMS reportedly suppressed scientists' concerns about environmental impact of spills in Alaska. A June 6 Denver Post article reported that an MMS office in Alaska rejected a 2006 analysis conducted by a biologist, which stated that a large oil spill could significantly harm fish populations. The analysis, which would have “required MMS to conduct a more detailed environmental impact statement before auctioning leases in the Beaufort Sea,” was rewritten after a supervisor told the biologist that his analysis would cause a “delay in sale 202. That would, as you can imagine, not go over well with HQ and others.” The Denver Post further reported, “Concerns raised by another MMS biologist, James Wilder, that the impact on polar bears was not adequately addressed in Shell's Alaska exploration plan, also were rebuffed, according to e-mails.”

Inspector General reports detail MMS ethics violations during Bush admin.

Inspector General found “a culture where the acceptance of gifts from oil and gas companies were widespread” in Louisiana MMS office. The Department of Interior's Office of Inspector General (OIG) investigated allegations against MMS employees for conduct that “occurred prior to 2007” in the Lake Charles, Louisiana, district, and “found a culture where the acceptance of gifts from oil and gas companies were widespread throughout that office,” and that prior to 2007, “receiving gifts such as hunting trips, fishing trips, and meals from oil companies appears to have been a generally accepted practice by MMS inspectors and supervisors in the Gulf of Mexico region.” MMS subsequently “provid[ed] additional ethics training to employees.”

IG investigation found email porn, illegal drug use at Louisiana MMS office. The Lake Charles investigation also found that -- in addition to accepting gifts from oil companies-- MMS employees “admitted to using illegal drugs during their employment at MMS,” including a clerical worker who said “he had used crystal methamphetamine the night prior to coming to work at MMS,” and an inspector who “admitted that he might have been under the influence of the drug at work after using it the day before.” Moreover, while reviewing MMS employees' email accounts “from 2005 to 2009,” the OIG found “numerous instances of pornography and other inappropriate material on the e-mail accounts of 13 employees, six of whom have resigned.”

IG: MMS employee negotiated a job with drilling company while inspecting their platforms. The IG report states that a Lake Charles MMS employee, who now works for the Island Operating Company, an oil and gas production firm, negotiated a job with the company while inspecting IOC platforms.

Source told OIG that some MMS inspectors allowed oil and gas companies to fill out their own inspection forms. From the May 24 report on the Lake Charles MMS office:

Another confidential source told investigators that some MMS inspectors had allowed oil and gas production company personnel located on the platform to fill out inspection forms. The forms would then be completed or signed by the inspector and turned in for review. According to the source, operating company personnel completed the inspection forms using pencils, and MMS inspectors would write on top of the pencil in ink and turn in the completed form.

We reviewed a total of 556 files to look for any alteration of pencil and ink markings, notations, or signatures. We found a small number with pencil and ink variations; however, we could not discern if any fraudulent alterations were present on these forms.

Inspector General: “Culture of ethical failure” at Colorado MMS office. The Office of Inspector General also issued a report on September 9, 2008 stating that several investigations uncovered a “culture of ethical failure” at the Lakewood, Colorado MMS office. The report stated that “between 2002 and 2006, nearly 1/3 of the entire RIK [Royalties In Kind] staff socialized with, and received a wide array of gifts and gratuities from, oil and gas companies with whom RIK was conducting official business.” In addition, the investigation found a “culture of substance abuse and promiscuity in the RIK program - both within the program... and in consort with industry. Internally, several staff admitted to illegal drug use as well as illicit sexual encounters.” The report further stated:

Our investigation revealed that many RIK employees simply felt that federal government ethics standards and DOI policies were not applicable to them because of their “unique” role in MMS. When interviewed, many RIK employees said they felt that in order to effectively perform their official duties, they needed to interact in social settings with industry representatives to obtain “market intelligence.” Some felt their free attendance at industry functions was an absolute necessity given that it was industry's practice to conduct business over lunch, dinner, and golf outings.

One RIK employee opined that because RIK regularly paid a major producer to transport oil, it was perfectly appropriate for him to attend a “treasure hunt” in the desert with all expenses paid by the producer. Another RIK employee went so far as to say that RIK's goal was to be “part of industry.”

In September 2009 Interior Secretary Ken Salazar announced plans to end the royalty-in-kind program, which collected royalties in oil and gas, rather than cash.