Ian Brickey, ian.brickey@sierraclub.org
WASHINGTON, D.C. -- Today the Department of the Interior announced new reforms to ensure taxpayers are not responsible for clean-up activities and expenses related to offshore drilling platform decommissioning. The new rule strengthens financial assurance requirements, requiring companies to prove their financial stability to ensure compliance with lease obligations.
The reforms enacted by the Biden Administration include:
- Streamlining the number of factors the Bureau of Ocean Energy Management uses to determine the financial strength of a company; and
- Consideration of the current value of the remaining proved oil and gas reserves on a lease compared to the estimated cost of meeting decommissioning obligations. If the lease has significant reserves remaining, and the original firm is unable to cover its obligations, the lease will likely be acquired by another operator who will assume the plugging and abandonment liabilities.
In response, Sierra Club Lands Protection Program Director Athan Manuel, released the following statement:
“For years, oil and gas companies have made massive profits by drilling on public lands and waters. And for years, taxpayers have been on the hook to clean up the messes these companies left behind.
“These reforms will ensure that oil and gas companies are accountable for their cleanup responsibilities and taxpayers won’t be left holding the bag.”
About the Sierra Club
The Sierra Club is America’s largest and most influential grassroots environmental organization, with millions of members and supporters. In addition to protecting every person's right to get outdoors and access the healing power of nature, the Sierra Club works to promote clean energy, safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and legal action. For more information, visit www.sierraclub.org.