Interior ends review waivers for deepwater drilling projects

The Interior Department said Monday that it will no longer allow deepwater oil-and-gas drilling projects to receive waivers from detailed environmental reviews.

The agency is also imposing new limits on use of the waivers for shallow-water projects.

{mosads}The announcement comes amid dueling political pressures on the agency to toughen oversight following the catastrophic BP oil spill and allow energy development that’s viewed as economically vital to the Gulf Coast.

Interior’s Bureau of Ocean Energy Management, Regulation and Enforcement said it would no longer use “categorical exclusions” from environmental analyses — the type of waiver that BP received for drilling its ill-fated Macondo well — for deepwater operations.

The controversial exclusions allow certain types of projects to avoid more detailed environmental analyses under the National Environmental Policy Act (NEPA).

Interior said the exemptions would be banned for future deepwater projects — which are under moratoria for the time being anyway — while the agency undertakes a broader review of its NEPA practices and categorical exclusions for offshore drilling.

“In light of the increasing levels of complexity and risk — and the consequent potential environmental impacts — associated with deepwater drilling, we are taking a fresh look at the NEPA process and the types of environmental reviews that should be required for offshore activity,” Interior Secretary Ken Salazar said in a prepared statement.

The announcement followed release of a White House Council on Environmental Quality report Monday on NEPA procedures employed by the now-defunct Minerals Management Service, the scandal-plagued predecessor to the Bureau of Ocean Energy.

The report calls for overhauling NEPA practices for offshore drilling and notes that BP received categorical exclusions for its exploration plan and drilling permits based on waiver criteria from the early and mid-1980s.

The ocean energy agency said it would conduct a review of categorical exclusions for shallow-water projects. For these projects, more detailed environmental assessments will be required under certain conditions, such as use of new or rare technologies and other circumstances.

Interior officials are hopeful that this will provide new clarity that allows shallow-water drilling permits to be processed more quickly.

The Obama administration has frozen deepwater drilling projects until late November, but has signaled that the ban may be lifted sooner if federal officials are confident that sufficient safeguards are in place. However, Bureau of Ocean Energy chief Michael Bromwich said in a memo that while the review of the NEPA exclusions is ongoing, he will not allow use of the environmental exemptions for deepwater projects even after the ban is lifted.

More broadly, Interior also announced that it will “conduct a new environmental analysis in the Gulf of Mexico that will help provide information to guide future leasing and development decisions.”