McDonnell’s Love Affair with Oil Continues

There are times when a person can become unhealthily obsessed with a new “love,” particularly one that promises to give you whatever you wish. Yes, sometimes it’s hard to be objective and look at a possible union with anything other than rose-colored glasses. Perhaps that explains why the unfolding catastrophe that is the BP Gulf oil spill hasn’t shaken Bob McDonnell’s love affair with the offshore oil industry that wants to “unite” with the Atlantic coast of Virginia.

McDonnell has returned to Richmond after his trip to pal around with oil and gas industry executives in Houston. “[The trip] just impressed upon me even more how enormously large this industry is, how many jobs and how much money is generated by offshore energy development,” McDonnell said, obviously enamored of his wealthy “suitor.”

(It’s pretty obvious that McDonnell wasn’t taken by his oily friends on a guided tour of the massive spill now spewing into the Gulf of Mexico and endangering fishing, shrimping, and tourist industries, as well as vital wildlife refuges.)

The governor aside, the prevailing attitude by Virginia’s politicians to the BP oil platform disaster and subsequent massive oil spill, for the most part, seems to be, “O.K., we need to pause and take stock of why this accident happened before we drill off Virginia’s Atlantic coast.” I would contend that there are other things we should be looking at as well, including whether the regulatory agency for such activities has been rehabilitated from its chronic corruption during the Bush oil-soaked presidency.

Sen Bill Nelson (D-FL) has called for an investigation of that agency, pointing out that it did not require BP to file a blowout plan when the company filed its exploration plan for the Deepwater Horizon rig last year.  

Almost everyone will agree that the eight years of the George W. Bush presidency led to a free hand being given to many industries, including mineral extraction, to conduct their business with a minimum of oversight, a situation that was doubly true of the Bush-Cheney first love, the oil industry. An obscure agency of the Interior Department, the Minerals Management Service (MMS), is charged with regulating renewable energy, oil and gas extraction, and mineral resources, plus collecting royalties generated from such activities on federal lands, including offshore. It also oversees the health and safety regulation of offshore drilling. Amazingly, MMS allows oil producers and drilling contractors to voluntarily abide by a safety management program created by the oil industry trade group, the American Petroleum Institute.

During the Bush presidency, MMS was riddled with episodes of drug use, bribery, sex scandals and the gutting of effective oversight. Only since Secretary Ken Salazar took the helm at the Interior Department last year has an effort begun to rescue the agency from the abuses of the last decade, and it is far from over. I would argue that until the MMS is rehabilitated and genuine oversight can return to the industry, further offshore oil drilling anywhere should be on indefinite hold.

In 2008, the Interior Department inspector general, Earl Devaney, reported wrongdoing by a dozen employees of MMS. The accusations came as Congress was debating expansion of offshore drilling, including off the coast of Virginia.

Delaney termed the activity he uncovered a “culture of ethical failure.” One high-ranking bureaucrat was charged with steering a consulting contract to a retiring aide, violating rules for competitive bids. Delaney’s report also said that eight officials in the royalty program accepted expensive gifts from energy companies, including golf and ski vacations, meals and drinks, and tickets to concerts and professional sports games.

The investigation uncovered instances when officials consumed excessive alcohol at industry functions, used recreational drugs at such events, and had sexual relationships with oil and gas industry representatives. The scandal further included collecting inadequate royalties from oil companies. (I suspect that those gifts and sexual favors just may have contributed to that, don’t you?)

Robert Kennedy, Jr. has traced the start of the systematic corruption at MMS to Vice President Dick Cheney’s secret meetings in 2001 with over 100 oil industry officials,  allowing them to draft a wish list of industry demands. Those meeting were followed by the re-staffing of  the Minerals Management Service with industry-friendly bureaucrats.

“In 2003, newly reconstituted Minerals Management Service genuflected to the oil cartel by recommending the removal of the proposed requirement for acoustic switches [on off-shore oil rigs]…’because they tend to be very costly,’ ” Kennedy said.

Acoustic switches are remotely triggered dead man’s switches that might well have been able to close off the BP oil leak at the sea floor wellhead when the manual switch failed after the platform explosion and fire. (Indeed, it may be that the operator responsible for the manual cutoff switch may have died in the initial explosion on the platform.)  Acoustic switches are required for all offshore rigs off Brazil and in Norway’s North Sea. In fact, BP uses the device elsewhere in the North Sea and in other parts of the world, as do Shell and France’s Total. In 2000, before the Bush administration gutted the agency, the Minerals Management Service called acoustic switches “essential” and proposed rules to mandate them on all offshore platforms.

So, we have yet another horrible example of why deregulation – whether of financial systems or industry – ultimately courts human disaster and environmental devastation.  

Kennedy points out, as well, that BP skirted proper drilling by failing to install a deep hole shut off valve, “another fail-safe that might have averted the spill.” And, BP’s negligence may have been compounded by Cheney’s old company, Halliburton.

The Gulf accident occurred shortly after Halliburton completed an operation to reinforce the platform’s drilling hole casing with concrete slurry. This is a difficult process that, according Kennedy, can trigger catastrophic blowouts if not performed well. Right now, Halliburton is under investigation by the Australian government for a huge blowout in the Timor Sea in 2005 that appears to have been caused by faulty concrete work.

So, Bob McDonnell notwithstanding, let’s pause for a very, very long time before we take a chance on despoiling our coastline for royalty income that, at present, isn’t even available to Virginia by law. Perhaps, we will come to the obvious conclusion that the best exploitation of our off-shore resources would be wind farms. I haven’t heard yet of a “wind spill” from a wind farm destroying the environment.