US Interior Secretary Says Impressed With Offshore Oil Industry Safety

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April 13, 2011

OFFSHORE GULF OF MEXICO (Dow Jones)–During a trip to a floating drilling rig in the deepwater Gulf of Mexico, U.S. Interior Secretary Ken Salazar said Wednesday that he was impressed by the safety improvements enacted by the oil industry nearly one year after the worst offshore oil spill in U.S. history.

“As we found out, the things they were doing before, are not what they are doing now,” Salazar told reporters during a helicopter flight after visiting the first rig to obtain a permit to resume drilling activity in the Gulf’s deepwater since the end of the federal drilling moratorium enacted after the Deepwater Horizon spill.

“We have seen a significant change from what we saw a year ago, for example new mechanisms and technologies to test the (blowout preventers) and other important safety measures,” Salazar said after the two-hour visit to the rig, which floats more than a mile above Noble Energy Inc. (NBL)’s Santiago prospect, about 70 miles off Louisiana. “It’s good to come back in very different conditions,” he said.

The rig, owned by drilling contractor Ensco, is expected to start drilling by the end of the week in an oil field scheduled to begin producing next year. It uses state-of-the art technology, including a new mechanism that allows to perform accurate tests of the rig’s blowout preventer, a giant set of valves that is the last line of defense against an oil spill. In April 2010, the failure of such a device led to the blast that killed 11 and sank the Deepwater Horizon, a rig drilling for BP PLC (BP, BP.LN).

Michael Bromwich, the director of the Department of Interior’s Bureau of Ocean Energy Management, Regulation and Enforcement, the agency that oversees offshore drilling, accompanied Salazar on the visit. Bromwich said that the stringent safety requirements enacted by the government prompted the energy industry to invest more in safety innovations, including containment systems to deal with future spills.

“We certainly hope and expect a new set of regulations will come after” the government concludes its investigation of the Deepwater Horizon incident, Bromwich said.

Last Month, a Norwegian engineering firm hired by the U.S. government determined that the blowout preventer failed because of faulty design and a bent piece of pipe.

“We will have to figure out a new set of rules” that could mean changes to blowout preventers, Bromwich said.

The officials’ offshore tour comes after President Barack Obama announced his administration’s new aim to reduce oil imports by more than 3 million barrels in the next decade–an objective that relies on increased oil production in areas like the deepwater Gulf. The oil industry has criticized the Obama administration for the long time they had to wait in order to resume drilling in the area.

The deepwater drilling ban was lifted last October, but permits only began to be issued in late February, when officials determined that containment systems designed to stop deepwater spills were in good enough shape. More than 10 permits have been approved since then.

“There is still a lot more to do and learn,” Bromwich said while he looked down from the helicopter to the handful of platforms scattered through the Gulf. “We want to continue improving the standards.”

-By Isabel Ordonez, Dow Jones Newswires

Pictured: Ensco 8501 Ultra-deepwater Semisubmersible in U.S. Gulf of Mexico

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