Offshore Drilling: Years of Lax Oversight, Small Fines for Serious Violations

Gov't agency collected just $21 mil in fines over 20 years from giant industry.

June 24, 2010, 12:50 PM

June 24, 2010— -- President Obama has all but guaranteed that a catastrophe like BP's oil spill in the Gulf of Mexico will never happen again, but months after the start of the disaster, government regulation of offshore drilling remains a shambles, and it maybe be impossible for the president to keep his pledge anytime in the near future.

New information reveals that oil drilling in the Gulf has been far more risky than previously thought for both the environment and rig workers, but the federal government's Mineral Management Service provided questionable oversight and punishments that amounted to little more than a slap on the wrist for giant oil companies.

Working on a rig is hazardous and sometimes deadly. From 2006 to 2009, 30 platform employees working in the Gulf of Mexico were killed in accidents and 1,300 people injured. Workers died in fires, fell through holes in platforms, and were crushed and killed by falling pipes.

"There was no watchdog in place," said Rep. Nick Rahall, (D-W. Va.), the chairman of the House Committee on Natural Resources. "There is no reason whatsoever why any individual in this country should have to put their life on the line to earn a livelihood."

But an ABC News review of federal records shows that despite chronic safety problems, the Minerals Management Service, or MMS, imposed paltry fines that often took years to collect. In the overwhelming majority of cases where workers were actually killed, there was no record of fines being paid. Where fines did occur, the maximum penalty was only $25,000.

"It's totally ridiculous, insane that such circumstances were allowed to exist," said Rahall.

In a 20-year period, MMS has only fined the oil drilling industry $21 million for hundreds of serious safety violations -- about a million dollars in fines per year for an industry that made $800 billion in profits in that timeframe.

Just $21 Million in Fines for Multi-Billion Dollar Oil Drilling Industry

"There's no doubt about it, the fines that have been leveled upon the oil industry are just a slap on the wrist," Rahall added.

MMS records paint a detailed and disturbing picture of the agency's own lax punishments.

In 2006, MMS inspectors investigated an off-shore oil spill stretching 16 miles long and nearly a mile wide. They discovered that operators of the platform had "bypassed basically the entire ... safety system." Still, the fine was only $505,000.

In 2002, inspectors found that workers at one of BP's Gulf platforms were not competent to "perform assigned well control duties." The fine was $41,000, and the government took five years to finally collect it.

Congress is partly to blame for the low fines because it hasn't changed penalties dramatically since the 1970s, but critics say that the problems at MMS should have been obvious.

"If I understand it correctly, MMS currently employs 60 inspectors to look after 3,800 platforms in the Gulf," Sen. Dianne Fienstein, (D-Ca.) said.

And of those inspectors, many are still not properly trained, according to Congressional investigators.

As the nation looks to the government for tougher off-shore drilling oversight, it appears that officials are literally starting from scratch.

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