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Shell’s Odum Calls to Ramp up Oil Federal Regulators Shell’s Odum Calls to Ramp up Oil Federal Regulators

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Energy / ENERGY

Shell’s Odum Calls to Ramp up Oil Federal Regulators

Shell Oil Company President Marvin E. Odum(Richard A. Bloom)

photo of Amy Harder
September 13, 2011

Shell Oil President Marvin Odum says the federal government’s oil and gas regulators are understaffed, singing a similar tune to another Big Oil executive last week.

“I do have a sense that they’re under-resourced and the need for more is probably real,” Odum told National Journal in a recent interview. “It ought to be addressed and if there is a gap there I think they ought to get more resources. In my conversations with those in government I have said exactly that.”

Odum added: “I’m interested in supporting [the Interior Department] in a way that helps them get it done and done in a right way.”

 

His comments, made after speaking to the U.S. Chamber of Commerce in July, took on renewed relevance after the nation’s top drilling regulator on Tuesday criticized the industry for making repeated claims that the federal government is “slow-walking” issuing permits for oil and gas drilling in the Gulf of Mexico following the BP oil spill last year.

House Natural Resources Committee Chairman Doc Hastings, R-Wash., and a range of industry organizations, including the Industrial Energy Consumers of America and Shallow Water Energy Security Coalition, have criticized the speed of Interior's new permitting process.

“I continue to be disappointed to see politically motivated, erroneous reports and commentaries, sponsored by various industry associations and groups, criticizing the [government] for allegedly 'slow-walking' permits and plans,” Michael Bromwich, the Interior Department’s point man on oil and gas drilling, said in a speech at the Center for Strategic and International Studies. “That is a phrase we see repeated over and over again, and it is simply not true.”

He then pointed out comments made by Chevron CEO John Watson last week that also rejected the "slow-walking" claims.

“I was pleased to see that, for the first time last week, the CEO of one of the major oil and gas companies said he thought the claim that we have been slow-walking permits was false,” Bromwich said. “It was about time that we heard an oil company executive say publicly what many had been saying privately to us for many months.”

Bromwich said Tuesday that since his agency implemented stricter regulations last June, he has issued 74 permits for shallow-water drilling activity in the Gulf of Mexico. And since February, when companies demonstrated they could contain a deep-sea spill, the bureau has approved 129 permits for new wells in the Gulf.

He also reinforced a plea he has made to Congress numerous times since the April 2010 BP spill: Interior’s new Bureau of Ocean Energy Management, Regulation, and Enforcement needs more money to do its job and function at a level that will help the industry. Bromwich and Interior Secretary Ken Salazar have repeatedly asked Congress for more money to revamp the department’s drilling agencies following the BP spill, but to date they have only received an additional $47 million.

Odum said the industry is still learning how to respond to the government’s new regulations, and said oil companies would start noticing over the next couple of months if the permit process actually has been slowed.  

“We’re still at this point of the industry of understanding exactly what [the government] is looking for,” said Odum, whose company is one of the leaders drilling in the Gulf in the tougher regulatory environment.

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