Spill panel chief wary of oil lobby’s role in new safety institute

The co-chairman of the presidential oil spill commission said the American Petroleum Institute’s (API) role in creating a new offshore safety organization could hinder the new body’s credibility.

“We think, as the commission, that it is best to separate it from the American Petroleum Institute,” said William Reilly, co-chairman of the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, in an interview that aired Sunday.

API in March announced the creation of the Center for Offshore Safety, which will be based in Houston and open to companies engaged in deepwater exploration and production. 

The powerful lobbying group said at the time that the new center would have independent review and other features that insulate it from API’s advocacy.

An industry safety group akin to the nuclear industry’s Institute for Nuclear Power Operations was among the recommendations from the spill commission’s final report in January.

But in an interview with Platts Energy Week, Reilly expressed concern about the new group’s affiliation with API, noting API is seen as the “advocate for Big Oil.”

“To the extent that the public sees this new institute as distinct from those lobbying activities, I think it will have credibility and respect,” Reilly said. “It is possible that it could have that if it is walled off from lobbying within the structure of API, but I think it will be harder to make the case.”

But Reilly also noted API’s technical capabilities, and said he’s taking a wait-and-see approach to the new group.

“It would surprise me if the industry would go to the great lengths of creating a new institution like this without being serious,” said Reilly, a Republican who headed the Environmental Protection Agency under President George H.W. Bush.

“But there is a public appearance, and that is a very important part of it. To gain the respect of the public, I think it is going to have to show that it is not just part of advocacy,” Reilly added, noting API’s past actions to “beat back regulations.”

API President Jack Gerard, in announcing the new group last month, said it will be “run by the separately funded standards and certification arm of the American Petroleum Institute,” which he noted receives audits and accreditation by the American National Standards Institute.

Here’s API’s description of the new body:

“The Center for Offshore Safety will draw on the lessons learned from successful, existing safety programs, applying the best elements of these programs to accommodate the unique challenges of offshore oil and natural gas operations, and will rely on independent auditing and review by third-party certifiers.”

Reilly’s comments continue what has been a tense back-and-forth between the spill commission — which disbanded last month — and the industry trade group.

The commission’s final report in January said “API’s ability to serve as a reliable standard-setter for drilling safety is compromised by its role as the industry’s principal lobbyist and public policy advocate.”

The criticism drew strong pushback from API.