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Salazar urges splitting agency overseeing oil rigs

WASHINGTON — The Obama administration is proposing to split up an Interior Department agency that oversees offshore drilling, as part of its response to the Gulf Coast oil spill.

Interior Secretary Ken Salazar called for a plan to split the Minerals Management Service in two. One agency would be charged with inspecting oil rigs, investigating oil companies and enforcing safety regulations, while the other would oversee leases for drilling and collection of billions of dollars in royalties. That would separate the agency's two core responsibilities, which critics say are diametrically opposed — making money off the industry, while also cracking down on it in ways that may affect the industry's bottom line.

"The tragedy aboard the Deepwater Horizon and the massive spill for which BP is responsible has made the importance and urgency of our reform agenda even clearer," Salazar said.

The Minerals Management Service, an arm of the Interior Department, oversees the nation's natural gas, oil and other mineral resources. The agency collects and distributes more than $13 billion per year in revenues from federal leases for offshore and onshore drilling. It also enforces laws and regulations that apply to drilling operations.

Critics have said the two roles are in conflict and are one reason the agency has long been accused of being too cozy with the oil and natural gas industry. There is growing bipartisan sentiment in Congress in favor of toughening oversight of MMS. At a minimum, lawmakers want to ensure that the agency's director is a Senate-confirmed position.

The current director, Elizabeth Birnbaum, was appointed by President Barack Obama but did not require Senate confirmation. Salazar said it is likely that a legislative package that would include Senate confirmation of the MMS director will be submitted to Congress.

Salazar said the reforms announced Tuesday are the first of several structural changes he is considering at Interior. At Obama's request, Salazar is conducting a 30-day review of offshore drilling. He also has appointed an Outer Continental Shelf Safety Oversight Board to recommend management improvements and closer oversight of offshore drilling operations.

Salazar urges splitting agency overseeing oil rigs 05/11/10 [Last modified: Wednesday, May 12, 2010 9:07am]
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