U.S. Says Oil Companies Lag on Spill Cleanup Plans

Oil companies seeking to drill deepwater offshore wells have not yet complied with a requirement that they demonstrate their ability to quickly contain a deepwater blowout and spill, the Obama administration said on Tuesday.

The administration was defending itself from oil industry critics who warned that delays in issuing permits for new offshore wells could damage the economy. The Interior Department’s Bureau of Ocean Energy Management has not approved a permit for a new deepwater exploratory well since it lifted its temporary ban on drilling at depths more than 500 feet last October.

The department said Tuesday that oil companies have yet to comply with a key requirement put in place after the BP oil spill ravaged the Gulf coast over summer.

“Not a single operator has demonstrated in a permit application that it has access to and can deploy containment resources to deal with a deepwater blowout and spill,” said Melissa Schwartz, a spokeswoman for the drilling agency, in a statement.

The lack of proof of adequate containment systems is the “main reason” drilling activity that was covered under the moratorium has not been approved to resume, Schwartz said.

Helix Energy Solutions Group Inc announced last week that it had reached a deal with some companies regarding the use of its deepwater containment system in the Gulf of Mexico.

A separate project, called the Marine Well Containment Company, that is led by Exxon Mobil Corp and includes all the major oil companies, is also developing a rapid-response oil spill containment system.

Schwartz said so far no operators have incorporated elements from either of these systems into their permit applications.

Separately on Tuesday, the American Petroleum Institute released an analysis by Wood Mckenzie that found that lengthy permitting delays could place as much as 680,000 barrels of oil equivalent Gulf production a day at risk in 2019.

“The potential harm is alarming,” said Kyle Isakower, of API. “We are talking about a transformation of the future relevance of deepwater Gulf development to U.S. domestic energy production – and a major threat to Gulf region jobs and to the nation’s energy security.

Based on the study, API said as many as 125,000 jobs could be lost in 2015 due to the delays.

(Editing by David Gregorio)