World Oilfield Forum
Drilling Fines Are 'Pocket Change' to Oil Companies, Democrats Say
Tennille Tracy 2/9/2012
WASHINGTON - The U.S. government collected less than $300,000 in fines from oil and natural gas companies drilling on federal lands over a 13-year period, presenting less of a deterrent than a minor slap on the wrist of violators, according to a new report from House Democrats.
The report, released by Democrats on the Natural Resources Committee, finds that the U.S. Interior Department issued $274,000 in fines between 1998 and 2011, "nothing more than pocket change for billion-dollar oil and gas companies."
Infractions recorded by the Interior Department during that time related to blowout preventer failures, a factor in the Deepwater Horizon oil spill, and inappropriate well construction.
The report comes as Capitol Hill lawmakers raise concerns over a drilling practice known as hydraulic fracturing, a common method used to extract oil and gas from federal lands. With questions surrounding the impact of fracking on drinking water, the Interior Department is expected to propose regulations that require companies to disclose the ingredients in fracking fluids.
The report released Wednesday faults the Interior Department for being inconsistent in issuing fines. It claims that the department issued fines to some companies, but not to others, for the exact same violation. "There doesn't seem to be a rhyme or reason to it," committee spokesman Eben Burnham-Snyder said.
The Interior Department has previously complained about the maximum fines it can charge to oil and gas companies for offshore infractions, as outlined under the law. Interior officials have urged Congress to raise the fine levels so they serve as a harsh enough deterrent to wealthy companies.
The Interior Department, under the Obama administration, has ramped up the number of well inspections and has levied higher fines than have been issued in the past, department spokesman Adam Fetcher said.
"As we continue to expand domestic natural gas production, it is essential that the public have full confidence that the right safety and environmental protections are in place," he said.
Maybe, but what OSHA is doing now is pure harassment and should not be tolerated.
That is true in a way.
I am sure you will agree that many need to be harassed.
Ask the people who do the job and get hurt, or die, about the conditions that are 'common sense' yet pushed aside to avoid the 'loss' of a few dollars.
'Bean' counters of whatever description contribute to the situation.
MONEY is NOTHING or TRIVIAL to some.
Revoking a licence would hurt.
When OSHA spies on a location taking pictures then drives up and states "I know we need a search warrant to come here but if you make me go get one we will fine you out of business" that is Government thuggery. OSHA could show up inspect, make recommendations then work with the oil companies and vendors to make corrections and then follow-up after a month or so to check on progress, but that is not whats happening. They are fining companies and individuals out of work. When I wake up in the morning and accidentally put on the wrong shirt it costs $4900.
I have worked on drilling rigs for 30 years and common sense is what is needed to work in this industry, problem is the regulators don't have it.
On the other topic - if a drilling rig spills 10 barrels of brine on the ground its a big fine plus clean-up costs and dealing with the EPA, but many States pour thousands if not millions of barrels of brine on the roads every Winter and that is OK.
I, like you, have been around for many years. I have told many an inspector to F.... OFF.
Even though they are 'government inspectors', they are on PRIVATE PROPERTY.
In all the years I have been 'auditing, surveying, inspecting', (whatever the terminology people like to use), I DO NOT SPY. I do not have to, I do not wish to.
I ALWAYS explain to the rig crew as soon as I introduce myself, 'I am not here to F.... with you, I am here to HELP you'. 'I am your 3rd pair of eyes'.
They soon find out I mean what I say.
If you observe something not quite right, DO NOT run away and be a 'telltale'. Explain and sort it out on the rig FIRST. IF NO RESPONSE, THEN you start the process.
I am there to make people aware of 'what they have', and advise how to be in compliance if not already, according to Industry, country, company rules and specifications.
There are NO holes that I have not visited over the years on a rig.
MOST have NOTHING to hide, 'it is after all their lives that are at stake'.
SOME are just plain lazy and think they can get away with it.
'It will come back and bite you someday', 'What goes around comes around', 'it is the little things that will eventually bite you in the a....'.
Many over the years, have been more than happy with my observations and experienced advise in many areas of the industry.
Yes, there are many 'double' standards that are condoned by signatories of many transparency & 'anti this or that' organisations.
I have pride in my ability to comply with the compliance agreements.
My credibility would be gone in a heart beat if I crossed the line.
COMMON SENSE is DEAD, as you and I know it.
And yes, these people do not really care, because they have not and will not ever get there shoes/boots/hands dirty.
They just wish to 'justify their existence' to others further up the 'food chain' who have 'less' knowledge about the real world of practical application.
You and I, and others continue to believe we make a difference, we cannot do it all.