Deepwater Horizon Oil Spill: Recent Activities
and Ongoing Developments
Jonathan L. Ramseur
Specialist in Environmental Policy
Curry L. Hagerty
Specialist in Energy and Natural Resources Policy
May 12, 2014
Congressional Research Service
7-5700
www.crs.gov
R42942
Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
Summary
In the wake of the explosion of the Deepwater Horizon offshore drilling rig in the Gulf of Mexico
on April 20, 2010, federal agencies, state and local government agencies, and responsible parties
faced an unprecedented challenge. An oil discharge continued for 87 days, resulting in the largest-
ever oil spill in U.S. waters.
Led by the U.S. Coast Guard, response activities continue but have diminished substantially:
• At the height of operations (summer of 2010), response personnel numbered over
47,000; as of April 2014, that figure has dropped to 131 response personnel,
including federal and state officials and responsible party staff and their
contractors.
• In April 2014, Louisiana joined Alabama, Mississippi, and Florida by
transitioning to a “Middle Response” cleanup process. However, the U.S. Coast
Guard Federal On-Scene Coordinator stated that this “transition to the Middle
Response process does not end clean-up operations.”
As one of the responsible parties, BP has spent over $14 billion in cleanup operations. In addition,
BP has paid over $14 billion to the federal government, state and local governments, and private
parties for economic claims and other expenses, including reimbursements for response costs
related to the oil spill. BP and other responsible parties have agreed to civil and/or criminal
settlements with the Department of Justice (DOJ). Settlements from various parties, to date, total
almost $6 billion. BP’s potential civil penalties under the Clean Water Act (CWA), which could
be considerable, are not yet determined.
The natural resources damage assessment (NRDA) process, conducted by federal, state, and other
trustees, is ongoing, and is now in its restoration planning phase. BP agreed to pay $1 billion to
support early restoration projects. Ten such projects have been funded to date, with aggregate
estimated costs of approximately $71 million. In December 2013, the trustees proposed an
additional $627 million to fund 44 restoration projects.
In addition, the RESTORE Act, enacted in 2012, directs 80% of any administrative and civil
CWA penalty revenue into a newly created trust fund, which supports environmental and
economic restoration projects in the Gulf states. Approximately $800 million is expected to be
available from a civil CWA settlement with Transocean—one of the responsible parties—but
projects have yet to receive funding.
The Deepwater Horizon incident generated considerable interest in offshore drilling safety and
related issues. In 2011, the Secretary of the Department of the Interior (DOI) redefined the
responsibilities previously performed by the Minerals Management Service (MMS) and
reassigned the functions of the offshore energy program among three separate organizations: the
Bureau of Ocean Energy Management (BOEM), the Bureau of Safety and Environmental
Enforcement (BSEE), and the Office of Natural Resources Revenue (ONRR). These agencies
have promulgated several rulemaking changes, some of which are based on issues raised by the
Deepwater Horizon spill.
In the aftermath of the spill, congressional interest was high, but has since decreased. Although
the 111th and 112th Congresses enacted several oil spill-related bills, the provisions in these laws
(other than the RESTORE Act) generally concerned short-term matters that did not have a lasting
impact on oil spill governance.
Congressional Research Service
Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
Contents
Introduction ...................................................................................................................................... 1
Oil Spill Response Activities ........................................................................................................... 2
Gulf Restoration: NRDA and the RESTORE Act ............................................................................ 3
Natural Resource Damage Assessment ..................................................................................... 3
Gulf Restoration and the RESTORE Act................................................................................... 4
Economic Claims and Other Payments ........................................................................................... 5
Civil and Criminal Settlements ........................................................................................................ 8
BP Criminal Settlement ............................................................................................................. 8
BP Civil SEC Settlement ........................................................................................................... 8
Transocean Civil and Criminal Settlement ................................................................................ 9
MOEX Civil Settlement ............................................................................................................ 9
DOI Safety Reforms and Regulatory Developments ..................................................................... 10
DOI Structural Changes ........................................................................................................... 10
DOI Regulatory Developments ............................................................................................... 11
Other DOI Actions ................................................................................................................... 11
Congressional Activity ................................................................................................................... 12
Activity in the 111th Congress .................................................................................................. 12
Activity in the 112th Congress ................................................................................................. 12
Activity in the 113th Congress ................................................................................................. 13
Investigations and Reports ............................................................................................................. 13
Selected CRS Reports for Further Reading ................................................................................... 15
Tables
Table 1. Selected BP Payments and Commitments Related to the 2010 Oil Spill ........................... 7
Contacts
Author Contact Information........................................................................................................... 16
Congressional Research Service
Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
Introduction
In the wake of the explosion of the Deepwater Horizon offshore drilling rig on April 20, 2010,
federal agencies, state and local government agencies, and responsible parties1 faced an
unprecedented challenge. Never before had a subsea drilling system discharge of this magnitude,
or an oil spill of this size—estimated at approximately 206 million gallons (4.9 million barrels)—
occurred in U.S. waters.2
The incident tested the public and private response capabilities, as well as the legal framework of
liability and compensation under the Oil Pollution Act.3 The oil spill cleanup, natural resource
damage assessment (NRDA), and compensation processes continue today.
This report provides a summary update of selected issues related to the 2010 Deepwater Horizon
oil spill:
• Oil Spill Response
• Gulf Coast Restoration
• Economic Claims and Other Payments
• Civil and Criminal Settlements
• Safety Reforms
• Congressional Activity
• Investigations and Reports
More detailed analysis of these and other issues is addressed in other CRS products, some of
which are listed at the end of this report.
1 Although BP is discussed as if it is the sole responsible party—a key term in the existing liability and compensation
framework—other entities are also considered responsible parties. The Department of Justice (DOJ) named nine
defendants in a civil suit filed December 15, 2010 (press release at http://www.justice.gov/opa/pr/2010/December/10-
ag-1442.html). For example, Transocean owned the Deepwater Horizon drilling rig. Three companies own the
Macondo well: BP has a 65% share, Anadarko Petroleum Corporation has a 25% share, and MOEX Offshore has a 10
% share (National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, Deep Water: The Gulf
Oil Disaster and the Future of Offshore Drilling, Report to the President (hereinafter “Commission Report”), January
2011).
2 An estimated 17% of this oil did not enter the Gulf environment, but was directly recovered from the wellhead by BP.
See the Federal Interagency Solutions Group, Oil Budget Calculator Science and Engineering Team, Oil Budget
Calculator: Deepwater Horizon-Technical Documentation, November 2010. See also CRS Report R41531, Deepwater
Horizon Oil Spill: The Fate of the Oil, by Jonathan L. Ramseur.
3 P.L. 101-380, primarily codified at 33 U.S.C. §2701 et seq. The Oil Pollution Act amended other sections of the U.S.
Code, including the Clean Water Act (e.g., 33 U.S.C. §1321) and portions of the tax code (26 U.S.C. §4611 and
§9509). See CRS Report R41679, Liability and Compensation Issues Raised by the 2010 Gulf Oil Spill, by Jonathan L.
Ramseur.
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Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
Oil Spill Response Activities
The uncontrolled discharge from the Deepwater Horizon continued for approximately 87 days
until, following several attempts, responders gained control of the release on July 15, 2010. The
response involved multiple agencies. As this spill occurred in the coastal zone, an on-scene
coordinator (OSC) from the U.S. Coast Guard continues to direct and coordinate the on-site
activities of federal, state, local, and private entities (e.g., BP and its contractors). This framework
of multiple parties working together under the leadership of the federal government is referred to
as the Unified Command.
During the height of operations in the summer of 2010,
• response personnel levels reached 47,000, and response vessel numbers
approached 7,000;4 and
• the maximum extent of shoreline oiling involved almost 1,100 miles of
shoreline.5
Response activities continue but have diminished substantially:
• As of April 2014, 131 response personnel remain in the Gulf region, including
federal and state officials and responsible party staff and their contractors.6
• In June 2013, the Coast Guard announced that the shorelines of Alabama,
Florida, and Mississippi returned to the pre-spill reporting system via the
National Response Center;7
• In April 2014, the Coast Guard announced that Louisiana shoreline activities will
transition to a “Middle Response” process, akin to the process in Alabama,
Florida, and Mississippi.8 However, the Federal On-Scene Coordinator stated that
“this response is not over—not by a long shot. The transition to the Middle
Response process does not end clean-up operations.”9
• In November 2010, the federal government released a peer-reviewed publication
that provided an estimate of what happened to the oil.10 The study concluded that
4 See “Operational Updates,” which were issued daily during the height of the oil spill response. Archived updates are
available at http://www.restorethegulf.gov.
5 Gulf Coast Incident Management Team, Deepwater Horizon Response: Situation Executive Summary, December
2013, at http://www.restorethegulf.gov.
6 Personal communication with U.S. Coast Guard (April 23, 2014).
7 Unified Command Press Release, “U.S. Coast Guard Deepwater Horizon Response transitions to National Response
Center reporting,” June 10, 2013, at http://www.restorethegulf.gov.
8 As described by the Federal On-Scene Coordinator, “while not an official response term under the NCP, the term
‘Middle Response’ has been used colloquially to describe the [National Response Center] process of responding to
reports of oiling across the Gulf with (1) dedicated Coast Guard teams pre-positioned for rapid response to Deepwater
Horizon oil and (2) pre-stationed Oil Spill Removal Organizations on standby, ready to clean up when required.” See
Memorandum from Federal On-Scene Coordinator (Sparks) to Gulf Coast Incident Management Team, April 15, 2014,
at http://www.restorethegulf.gov/release/2014/04/15/fosc-update-deepwater-horizon-response.
9 Press Release, “Different tactics, Deepwater Horizon Response is far from complete,” April 15, 2014, at
http://www.restorethegulf.gov/release/2014/04/15/different-tactics-deepwater-horizon-response-far-complete.
10 The Federal Interagency Solutions Group, Oil Budget Calculator Science and Engineering Team, Oil Budget
(continued...)
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Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
approximately 50% of the oil had evaporated, dissolved, or been effectively
removed from the Gulf environment through human activities. Thus, at the time
of the study, a substantial portion—over 100 million gallons—remained, in some
form, in the Gulf.11 Subsequent research suggests that microbial organisms
(bacteria) consumed a considerable amount of the oil in the water column.12
Gulf Restoration: NRDA and the RESTORE Act
Natural Resource Damage Assessment
When a spill occurs, natural resource trustees conduct a natural resource damage assessment
(NRDA) to determine the extent of the harm.13 Trustees may include officials from federal
agencies designated by the President, state agencies designated by the relevant governor, and
representatives from tribal and foreign governments. Natural resource damages are intended to be
compensatory, not punitive. Collected damages cannot be placed into the general treasury
revenues of the federal or state government, but must be used to restore or replace lost resources.
The National Oceanic and Atmospheric Administration (NOAA) oversees the NRDA process.14
The trustees’ work occurs in three steps: a Pre-assessment Phase, the Restoration Planning Phase,
and the Restoration Implementation Phase. The Deepwater Horizon NRDA process is in the
restoration planning phase.
In 2011, BP agreed to provide $1 billion toward early restoration projects in the Gulf of Mexico
to address injuries to natural resources caused by the spill. “Early Restoration” projects may be
developed prior to the completion of the injury assessment, which may take months or years to
complete. According to NOAA, 10 early restoration projects have been funded to date with
aggregate estimated costs of approximately $71 million.15 In December 2013, the trustees
released a draft plan that proposes $627 million in funding for 44 additional restoration projects.16
The funding for the early restoration projects will be credited against BP’s liability for natural
resource damages resulting from the spill.
(...continued)
Calculator: Deepwater Horizon-Technical Documentation, November 2010.
11 For a more extensive analysis, see CRS Report R41531, Deepwater Horizon Oil Spill: The Fate of the Oil, by
Jonathan L. Ramseur.
12 See, e.g., David Valentine et al, “Dynamic autoinoculation and the microbial ecology of a deep water hydrocarbon
irruption,” Proceedings of the National Academy of Sciences, January 2012; Bethanie Edwards et al., “Rapid Microbial
Respiration of Oil from the Deepwater Horizon Spill in Offshore Surface Waters of the Gulf of Mexico,”
Environmental Research Letters, Vol. 6, August 2011.
13 For more information, see CRS Report R41972, The 2010 Deepwater Horizon Oil Spill: Natural Resource Damage
Assessment Under the Oil Pollution Act, by Adam Vann and Robert Meltz.
14 For more information on NOAA activities related to the Deepwater Horizon NRDA process, see
http://www.gulfspillrestoration.noaa.gov/oil-spill/.
15 See Phase I (April 2012) and Phase II (October 2012) Early Restoration Plans, at
http://www.gulfspillrestoration.noaa.gov/.
16 More details are available at NOAA’s website at http://www.gulfspillrestoration.noaa.gov/restoration/early-
restoration/phase-iii/.
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Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
Gulf Restoration and the RESTORE Act
In addition to natural resource damages that were a direct result of the spill, the Deepwater
Horizon incident generated interest in natural resource issues in the region that were present
before the spill occurred. On June 15, 2010, the Administration committed to developing a long-
term Gulf of Mexico restoration plan for post-spill recovery needs as well as long-term
restoration. In contrast to the environmental damages addressed by NRDA, the Administration’s
plan would address a broader array of restoration needs,17 many of which predate the oil spill.18
To further this objective, the President established the Gulf Coast Ecosystem Restoration Task
Force in October 2010 to develop a restoration strategy,19 which was released in December
2011.20 With the enactment of the RESTORE Act (discussed below) in July 2012, and the creation
of the Gulf Coast Ecosystem Restoration Council, the President disbanded the Task Force.21
On July 6, 2012, the President signed P.L. 112-141 (MAP-21), which includes a subtitle referred
to as the RESTORE Act. The RESTORE Act establishes the Gulf Coast Restoration Fund in the
General Treasury. Eighty percent of any administrative and civil Clean Water Act (CWA) Section
311 penalties paid by responsible parties in connection with the 2010 Deepwater Horizon oil spill
will provide the revenues for the Trust Fund. Amounts in the fund will be available for
expenditure without further appropriation.
The RESTORE Act distributes monies to various entities through multiple processes:
• 35% divided equally among the five Gulf of Mexico states to be applied toward
one or more of 11 designated activities;
• 30% provided to a newly created Gulf Coast Ecosystem Restoration Council to
finance ecosystem restoration activities in the Gulf Coast region;
• 30% disbursed by the Council to the five Gulf states, based on specific criteria:
shoreline impact, oiled shoreline distance from the Deepwater Horizon rig, and
coastal population. Each state must submit a plan for approval, documenting how
funding will support one or more of the 11 designated activities; and
• 5% to support marine research and related purposes.
As a result of a CWA civil settlement with Transocean—the owner of the Deepwater Horizon
drilling rig and an identified responsible party—a total of $800 million, plus interest, is expected
to be deposited into the Trust Fund within the next two years. Potential CWA civil penalties
against BP, which could be considerable, are yet to be determined. For more details, see the text
box below. For more information on the RESTORE Act and its implementation, see CRS Report
R43380, Gulf Coast Restoration: RESTORE Act and Related Efforts, by Charles V. Stern, Pervaze
A. Sheikh, and Jonathan L. Ramseur.
17 See the Obama Administration’s America’s Gulf Coast: A Long Term Recovery Plan after the Deepwater Horizon
Oil Spill (sometimes referred to as the “Mabus Report”), September 2010.
18 See CRS Report R41640, The Deepwater Horizon Oil Spill and the Gulf of Mexico Fishing Industry, by Harold F.
Upton.
19 Executive Order 13554 in 75 Federal Register 62313 (October 8, 2010).
20 See http://epa.gov/gulfcoasttaskforce/pdfs/GulfCoastReport_Full_12-04_508-1.pdf.
21 Executive Order 13626 in 77 Federal Register 56749 (September 13, 2012).
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Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
Potential Clean Water Penalties against BP
Section 311 of the Clean Water Act authorizes certain civil judicial penalties for the owner, operator, or person in
charge of a vessel, onshore facility, or offshore facility for violations of that provision. A civil judicial penalty applies to
a violation of the CWA prohibition on discharging oil into navigable waters of the United States. The monetary
penalty for this violation may be up to $37,500 per day of violation, or up to $1,100 per barrel discharged. If the
violation is deemed a result of gross negligence or willful misconduct, the penalty is not less than $140,000 for the
violation, nor more than $4,300 per barrel discharged.
According to the most recent estimate from the federal government, the 2010 oil spill resulted in a discharge of
approximately 206 million gallons (4.9 million barrels) in the Gulf of Mexico.22 However, BP argued that an estimated
17% of the 4.9 million barrels did not enter the Gulf environment, but was directly recovered from the wellhead by
BP. In February 2013, the federal government agreed with BP that this volume of oil would not be considered toward
the CWA penalty determination.23 Accordingly, the estimated amount of oil discharged that is relevant for
determining CWA penalties is approximately 4.1 million barrels.
Based on the February 2013 agreement, some have estimated the potential judicial penalty range to be between $4.5
billion and $17.6 billion. The range reflects the difference resulting from multiplying the estimated 4.1 million barrels
by either $1,100 or $4,300/barrel discharged, depending on whether or not the discharged is deemed to be the result
of “gross negligence” or “willful misconduct.”
However, when determining the amount of the judicial penalty, CWA Section 311(b)(8)24 states that “the
Environmental Protection Agency (EPA) Administrator, the Secretary [of Homeland Security],25 or the court, as the
case may be,” must consider other factors, including “the degree of culpability involved” and “the nature, extent, and
degree of success of any efforts of the violator to minimize or mitigate the effects of the discharge.” Therefore, the
judicial civil penalty for the incident could be less than the low end of the above range ($4.5 billion), even if gross
negligence or willful misconduct is determined.
Economic Claims and Other Payments
As an identified responsible party,26 BP is liable for cleanup costs, natural resource damages
(discussed in a subsequent section), and various economic damages.27 The total payments
associated with the 2010 Gulf spill have already surpassed those of the 1989 Exxon Valdez oil
spill.28
22 Federal Interagency Solutions Group, Oil Budget Calculator Science and Engineering Team, Oil Budget Calculator:
Deepwater Horizon-Technical Documentation, November 2010. See also CRS Report R41531, Deepwater Horizon Oil
Spill: The Fate of the Oil, by Jonathan L. Ramseur.
23 U.S. District Court, Eastern District of Louisiana, Stipulation Mooting BP’s Motion for Partial Summary Judgement,
February 19, 2013, at http://www.laed.uscourts.gov/OilSpill/OilSpill.htm.
24 33 U.S.C. §1321(b)(8).
25 The Coast Guard is part of the Department of Homeland Security.
26 For the purpose of this report, BP is discussed as if it is the sole responsible party—a key term in the existing liability
and compensation framework. However, other parties are also considered responsible parties. The Department of
Justice named 9 defendants in a civil suit filed December 15, 2010. See Press Release at http://www.justice.gov/opa/pr/
2010/December/10-ag-1442.html.
27 Oil Pollution Act, 33 U.S.C. §2702.
28 The Exxon Valdez was a U.S.-flagged tanker that grounded in Prince William Sound, AK, in March 1989, spilling
approximately 11 million gallons of oil. The oil spill sparked regional and nationwide interest in oil spill prevention,
response, clean-up, and liability. In association with the 1989 oil spill, Exxon paid approximately $4.9 billion.
Payments were made voluntarily and pursuant to several different legal proceedings at different times over
approximately 20 years.
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Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
As of December 2013, BP has spent over $14 billion in cleanup operations.29 Further payments
made by BP to different parties for various purposes are identified in Table 1.
As noted in the table, several of the payment mechanisms are still ongoing, namely the “Court
Settlement Program.” In August 2010, multiple lawsuits, involving over 100,000 private claims
against BP and the other defendants (e.g., Transocean and Haliburton) were consolidated before
the U.S. District Court in New Orleans. On April 18, 2012, BP and many of the plaintiffs reached
a settlement agreement, which was approved by the Court on December 21, 2012. The settlement
establishes a court-supervised program to evaluate and award various economic claims from
individuals and businesses, but does not involve governments, shareholders, or claims related to
the drilling moratorium. Except for a limit of $2.3 billion for seafood compensation, the
settlement is not capped.30 As indicated in Table 1, the settlement program had awarded nearly $4
billion as of March 31, 2014.
However, BP has pursued legal action to suspend payments from the settlement program, arguing
that parties are receiving payment for losses “not traceable to the Deepwater Horizon accident
and oil spill.”31 In the latest decision (March 3, 2014), the 5th Circuit Court of Appeals upheld a
federal district ruling, allowing the court-supervised program to continue paying claims.32
Another ongoing compensation process, identified as the “BP Claims Program” in Table 1, refers
to claims to eligible parties not subject to the class action settlement or for those who choose to
opt out of the class settlement.
Other components of the consolidated litigation are still pending, such as claims against BP not
included in the above settlement and claims involving the other defendants, including Transocean
and Haliburton.
29 BP Deepwater Horizon response website at http://www.bp.com/en/global/corporate/gulf-of-mexico-restoration/
deepwater-horizon-accident-and-response/completing-the-response.html.
30 For more information, see http://www.deepwaterhorizoneconomicsettlement.com.
31 See, e.g., BP Press Release, “BP’s Response to Fifth Circuit Decision of March 3, 2014,” at http://www.bp.com.
32 For further updates on the legal process, see Deepwater Horizon Claims Center website at
http://www.deepwaterhorizoneconomicsettlement.com/index.php.
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Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
Table 1. Selected BP Payments and Commitments Related to the 2010 Oil Spill
As of March 31, 2014, Unless Noted Otherwise
Amount of Payment
Recipient(s) Purpose
($ millions)
Federal government
Reimbursements for oil spill response costsa $705
Behavioral
health
$10
Contributionsb $22
States
Reimbursements for response costs and
other claims
$738
Tourism
promotion
$179
Seafood
marketing
$49
Seafood
testing
$25
Behavioral
health
$42
Contributions
$5
Individuals and/or businesses
Economic claims
- BP Claims Program
May 5, 2010 - August 22, 2010
$399
- Gulf Coast Claims Facility
August 23, 2010 – June 4, 2012
$6,667
- Court Settlement Program
$3,996
June 4, 2012 – Present
Ongoing
- BP Claims Program
$11
June 4, 2012 – Present
Ongoing
Vessels of Opportunity Programc $626
Real Estate Fundd $54
Gulf of Mexico Research Initiativee $500
TOTAL
$14,028
Source: Prepared by CRS; unless specified below, data from BP, Gulf of Mexico Oil Spill Claims and Other
Payments Public Report, March 31, 2014, at http://www.bp.com.
Notes: More information about the above payments is available at http://www.bpgulfupdate.com.
a. The reimbursed response costs to federal and state governments is likely included in BP’s estimate of total
response costs (over $14 billion).
b. The purpose of the “contributions” to the federal government and states is not specified in BP’s 2014 Public
Report.
c. During the oil spill response, BP employed private vessels to conduct response efforts such as skimming,
booming, and transporting supplies. According to the final report from National Commission on the BP
Deepwater Horizon Oil Spill and Offshore Drilling, vessels made between $1,200 and $3,000 per day.
Payment data from Gulf Coast Claims Facility, Overall Program Statistics, May 14, 2012.
d. BP established a separate fund and process to award claims to real estate agents affected by the incident.
Claims data from Gulf Coast Claims Facility, Overall Program Statistics, May 14, 2012.
e. On May 24, 2010, BP announced a commitment of up to $500 million over 10 years to fund an independent
research program to study the impact of the oil spill and its associated response on the environment and
public health in the Gulf of Mexico. More information is available at http://gulfresearchinitiative.org.
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Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
Civil and Criminal Settlements
The Department of Justice (DOJ) has announced criminal and/or civil settlements with several
parties involved in the 2010 oil spill.33 Settlements from various parties, to date, total almost $6
billion. Other settlements may be forthcoming. As discussed below, the settlement payments will
support several objectives.
BP Criminal Settlement
On November 15, 2012, BP and DOJ announced a criminal penalty settlement of approximately
$4 billion, which was approved by the U.S. District Court in the Eastern District of Louisiana on
January 29, 2013. In accordance with the settlement, BP has agreed to plead guilty to 11 felony
counts of Misconduct or Neglect of Ships Officers for the deaths of 11 people in the disaster, as
well as misdemeanor counts under the Clean Water Act and the Migratory Bird Treaty Act, and a
felony count of obstruction of Congress.34
The $4 billion would be distributed as follows:
• $2.394 billion to the National Fish and Wildlife Foundation (NFWF) to support
restoration efforts in the Gulf states.35
• $1.15 billion to the Oil Spill Liability Trust Fund.
• $350 million to the National Academy of Sciences for oil spill prevention and
response research.
• $100 million to the North American Wetlands Conservation Fund.
• $6 million to the General Treasury.
BP Civil SEC Settlement
On November 15, 2012, BP and the Securities and Exchange Commission (SEC) announced a
settlement involving civil securities fraud charges, including statements concerning the estimated
flow rate of the leaking well. The U.S. District Court in the Eastern District of Louisiana
approved the settlement on December 10, 2012. The BP agreed to pay $525 million to settle the
charges. The SEC stated it would use this payment to establish a fund “to provide harmed
investors with compensation for losses they sustained in the fraud.”36
33 DOJ also filed charges against individuals for various actions.
34 See http://www.justice.gov/iso/opa/resources/43320121115143613990027.pdf.
35 For more information on this distribution, see CRS Report R43380, Gulf Coast Restoration: RESTORE Act and
Related Efforts, by Charles V. Stern, Pervaze A. Sheikh, and Jonathan L. Ramseur.
36 See SEC Press Release, November 15, 2012, at http://www.sec.gov/news/press/2012/2012-231.htm.
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Deepwater Horizon Oil Spill: Recent Activities and Ongoing Developments
EPA’s Suspension of BP
On November 28, 2012, EPA announced suspension of BP Exploration and Production Inc. (and a number of affiliated
companies) from certain future government contracting activities, including government procurement contracts.37 As
grounds for this suspension, EPA cited BP’s lack of business integrity, particularly information that reportedly came to
light during settlement discussions with DOJ (discussed above).38
EPA’s action raised questions concerning BP’s ability to participate in offshore lease sales for oil and gas production.
BP did not participate in a November 28, 2012, lease sale administered by DOI, leaving many to question whether
EPA’s action barred BP from bidding, or whether BP decided to sit it out.
On March 13, 2014, EPA reached a conditional agreement with BP to lift the suspension and debarment.39
Transocean Civil and Criminal Settlement
On January 3, 2013, the Department of Justice announced civil and criminal penalty settlements
with Transocean, the company that owned and operated the Deepwater Horizon drilling rig. The
U.S. District Court in the Eastern District of Louisiana approved the settlements on separate
occasions in February 2013.
In the civil settlement, Transocean agreed to pay $1 billion, of which 80% ($800 million) will go
into the newly created Gulf Coast Restoration Trust Fund (pursuant to the “RESTORE Act” in
P.L. 112-141). The remaining 20% goes into the Oil Spill Liability Trust Fund.40
In the Transocean Guilty Plea agreement for criminal charges, Transocean agreed to pay $400
million.41 The amount is to be distributed as follows:
• $150 million to the NFWF;
• $150 million to the National Academy of Sciences for oil spill prevention and
response research; and
• $100 million in fines would go to the Oil Spill Liability Trust Fund.42
MOEX Civil Settlement
On February 17, 2012, DOJ and MOEX Offshore 2007 LLC agreed to a $70 million civil penalty
settlement, with an additional $20 million in supplemental environmental projects. The U.S.
District Court in the Eastern District of Louisiana approved the settlement on June 8, 2012. At the
37 For more information on this issue, see CRS Report RL34753, Debarment and Suspension of Government
Contractors: A Legal Overview, by Kate M. Manuel.
38 The full announcement of this suspension can be found at http://yosemite.epa.gov/opa/admpress.nsf/
d0cf6618525a9efb85257359003fb69d/2aaf1c1dc80c969885257abf006dafb0!opendocument.
39 See http://www2.epa.gov/home/march-13-2014-administrative-agreement-lifting-suspension-and-debarment-bp-
federal-government.
40 The civil settlement consent decree is available at http://www.justice.gov/iso/opa/resources/
915201313122945254063.pdf.
41 The Guilty Plea Agreement is available at http://www.justice.gov/opa/documents/transocean-plea-agreement.pdf.
42 Although the agreement does not explicitly state this allocation, penalties paid pursuant to Clean Water Act Section
309 (33 U.S.C. §1319) would go to the Fund (26 U.S.C. §9509(b)(8)).
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time of the 2010 oil spill, MOEX owned approximately 10% of the lease for the Macondo well.
Of the penalty amount,
• $45 million goes to the Oil Spill Liability Trust Fund, and
• $25 million is to be distributed in various amounts among the five Gulf states.43
DOI Safety Reforms and Regulatory Developments
Agencies within the Department of the Interior (DOI) have the lead regulatory authority for
offshore oil and gas development activities, including operational safety and environmental
considerations.44 The 2010 Deepwater Horizon oil spill generated considerable interest in
offshore drilling safety and related issues. For example, in its 2011 final report, the National
Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling stated, “changes in
safety and environmental practices, safety training, drilling technology, containment and clean-up
technology, preparedness, corporate culture, and management behavior will be required if
deepwater energy operations are to be pursued in the Gulf—or elsewhere.”45
This section highlights Department of the Interior (DOI) regulatory developments and other
activities that have addressed some of the safety concerns and other issues raised during and after
the 2010 oil spill.
DOI Structural Changes
Prior to the oil spill, DOI and congressional investigations had identified a number of
management shortcomings, ethical lapses among personnel, and conflicts of interest in the former
Minerals Management Service (MMS). Specific concerns involving agency reorganization and
regulatory policies toward safety reforms had been raised in oversight hearings and in reports,
including reports by the DOI inspector general.46
On May 19, 2010, Secretary of the Interior Ken Salazar replaced the MMS with the Bureau of
Ocean Energy Management, Regulation and Enforcement (BOEMRE). On October 1, 2011, DOI
divided BOEMRE into three separate entities: the Bureau of Ocean Energy Management
(BOEM), the Bureau of Safety and Environmental Enforcement (BSEE), and the Office of
Natural Resources Revenue (ONRR).47
43 For further information, see EPA’s website, which includes the Consent Decree, at http://www.epa.gov/enforcement/
air/cases/moex.html.
44 For more details see CRS Report RL33404, Offshore Oil and Gas Development: Legal Framework, by Adam Vann.
45 National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, Deep Water: The Gulf Disaster
and the Future of Offshore Drilling, Report to the President, January, 2011, p. 215.
46 See, for example, DOI, Office of Inspector General, Evaluation Report: Minerals Management Service Royalty-In-
Kind Oil Sales Process, 2008; DOI, Office of Inspector General, Investigative Report: Island Operating Company et al,
2010; DOI, Office of Inspector General, Investigative Report: MMS Oil Marketing Group - Lakewood, 2008.
47 For more information see CRS Report R42599, Department of the Interior (DOI) Reorganization of Ocean Energy
Programs, by Curry L. Hagerty.
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DOI Regulatory Developments
DOI agencies have issued several regulatory and policy changes related to offshore activities. In
general, these efforts are intended to reduce accidents, injuries, and spills during offshore drilling
activities. The regulations add several new requirements to regulations for Safety and
Environmental Management Systems (SEMS). Some requirements pertain to developing and
implementing stop work authority and establishing guidelines for reporting unsafe working
conditions. Additional requirements include conducting job safety analyses for activities
identified in an operator’s SEMS program. In addition, there are requirements that SEMS
programs be audited by an accredited audit service provider.
The following is a time line of relevant regulatory actions:
• October 14, 2010: interim final rule48 implementing certain safety measures that
were identified in a June 2010 report from the Secretary of the Interior.49
• October 15, 2010: final rule requiring OCS operators to implement a SEMS
program.50
• August 22, 2012: final rule amending and clarifying several safety provisions in
the October 14, 2010 interim final rule.51
• April 5, 2013: final rule adding new requirements to the existing SEMS
regulations.52
• February 24, 2014: proposed rule that would increase the Oil Pollution Act
liability limit53 for damages applicable to offshore facilities from $75 million to
approximately $134 million.54
In addition to rulemaking activity, DOI agencies issued several notices to lessees to address
related issues through policy guidance.55
Other DOI Actions
On August 16, 2013, DOI’s Bureau of Safety and Environmental Enforcement (BSEE) and the
Department of Transportation’s Bureau of Transportation Statistics (BTS) signed an interagency
agreement to develop a confidential near-miss reporting system. This system would expand the
ability of BSEE and industry to collect certain information about accident precursors and
48 75 Federal Register 63345 (October 14, 2010).
49 On June 8, 2010, BOEMRE issued a Notice to Lessees (NTL) addressing those recommendations identified in the
Safety Measures Report as warranting immediate implementation (NTL No. 2010–N05—Increased Safety Measures
for Energy Development on the OCS).
50 This rule (75 Federal Register 63609) was first considered in an advanced notice of proposed rulemaking in 2006.
51 77 Federal Register 50856 (August 22, 2012).
52 78 Federal Register 20423 (April 5, 2013).
53 33 U.S.C. §2704(a)(3). The liability limit for offshore facilities only applies to natural resource damages and eligible
economic damages. In contrast to other responsible party categories (e.g., tank vessels and onshore facilities) the
liability for response costs is unlimited.
54 79 Federal Register 10056 (February 24, 2014).
55 The NTLs are available at http://www.bsee.gov/About-BSEE/BSEE-History/Reforms/Reforms/.
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potential hazards associated with OCS operations in particular locations. The system involves
voluntary reporting by both industry and federal personnel, to ensure confidentiality for those
who report near misses. The BTS is responsible for developing and managing the reporting
system, which is expected to be operational in 2014.
On August 22, 2013, BSEE and the Department of Energy signed a Memorandum of
Collaboration to coordinate the ongoing efforts of the two agencies on offshore research and
technological improvement projects. The agencies plan to continue to collaborate in support of
three primary objectives: building safety through technological improvements; supporting
research and development for offshore operations; and working together to support the
implementation of recommendations arising from various investigations and studies related to the
Deepwater Horizon oil spill.56
Congressional Activity
Activity in the 111th Congress57
During the immediate aftermath of the oil spill, Senate and House committees in the 111th
Congress held more than 60 hearings on a variety of oil spill-related issues.58 Members
introduced more than 150 legislative proposals related to oil spill matters. The 111th Congress
enacted three of these proposals into law (P.L. 111-191, P.L. 111-212, and P.L. 111-281).
Provisions in the first two laws generally concerned short-term matters that will not have a lasting
impact on oil spill governance. However, H.R. 3619, the Coast Guard Authorization Act for
Fiscal Years 2010 and 2011, which the President signed October 15, 2010 (P.L. 111-281),
included more substantial changes.
In addition to the enacted legislation, the House in the 111th Congress passed several bills,
including H.R. 3534 (the Consolidated Land, Energy, and Aquatic Resources Act, or CLEAR
Act), that included multiple oil spill provisions. The Senate had comparable bills on its legislative
calendar under General Orders, but did not vote on their passage.
Activity in the 112th Congress59
Although interest arguably diminished in the 112th Congress (relative to interest in the 111th
Congress—see below), some Members continued to express concerns regarding various oil spill-
related policy matters. Members proposed over 50 bills that contained oil spill-related provisions.
56 More information is available at http://www.bsee.gov/BSEE-Newsroom/Press-Releases/2013/Press08232013z.aspx.
57 For further details see, CRS Report R41453, Oil Spill Legislation in the 111th Congress, by Jonathan L. Ramseur
(archived).
58 In some cases, investigatory reports followed. For example, see reports by the House Committee on Energy and
Commerce Oversight and Investigations Subcommittee and Energy and the Environment Subcommittee, at
http://democrats.energycommerce.house.gov/; and the House Committee on Natural Resources, at
http://naturalresources.house.gov/calendar/archives/list.aspx?EventTypeID=158:165.
59 For more details, see CRS Report R41684, Enacted and Proposed Oil Spill Legislation in the 112th Congress, by
Jonathan L. Ramseur.
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The 112th Congress enacted two statutes that contain oil spill-related provisions. The RESTORE
Act, enacted on July 6, 2012, is discussed above. On January 3, 2012, the President signed P.L.
112-90 (the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011), which
• increases civil penalties for violating safety requirements and requires automatic
and remote-controlled shutoff valves on newly constructed transmission
pipelines;
• directs the Department of Transportation to analyze leak detection systems, and
after a review by Congress, issue requirements based on this analysis; and
• requires the Pipeline and Hazardous Materials Safety Administration to review
whether current regulations are sufficient to regulate pipelines transmitting
“diluted bitumen,” and analyze whether such oil presents an increased risk of
release.
On December 23, 2011, the 112th Congress enacted one bill with provisions that affect OCS
development: P.L. 112-74 (Consolidated Appropriations Act, 2012). Among other provisions, this
act transferred air emission regulatory authority in the OCS off Alaska’s north coast from the U.S.
Environmental Protection Agency (EPA) to the Department of the Interior (DOI). Some
stakeholders would contend that DOI’s program has less stringent requirements than EPA’s
program.60
In addition, the House passed several bills that intended to encourage oil and gas development on
the OCS: H.R. 1230, H.R. 1229, H.R. 1231, and H.R. 2021. The Senate did not report analogous
legislation.
Activity in the 113th Congress
Compared to prior Congresses, oil spill-related legislation has received minimal attention in the
113th Congress. Members have proposed approximately 15 bills that include oil spill-related
provisions. To date, one such bill has passed the House. On June 28, 2013, the House passed the
Offshore Energy and Jobs Act (H.R. 2231), which would accelerate domestic oil and gas
production by providing for, among other statutory changes, a reorganization of the current DOI
subdivisions responsible for domestic oil and gas operations.61
Investigations and Reports
Several investigations and commissions—both federal and private—were initiated to examine
issues surrounding the Deepwater Horizon incident. The following includes a list of the more
prominent studies, investigations, and inquiries that have been completed or are under way (listed
in order of report publication date):
60 For more information, see CRS Report R42123, Controlling Air Emissions from Outer Continental Shelf Sources: A
Comparison of Two Programs—EPA and DOI, by Jonathan L. Ramseur.
61 For more information, see CRS Report R43137, Department of the Interior Ocean Energy Bureaus: Status of 2010
Structural Reforms and Issues for Congress, by Curry L. Hagerty.
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• Thad Allen, National Incident Commander’s Report: MC252 Deepwater
Horizon, October 2010.62
• U.S. Coast Guard, BP Deepwater Horizon Oil Spill: Incident Specific
Preparedness Review, January 2011.63
• National Commission on the BP Deepwater Horizon Oil Spill and Offshore
Drilling, Deep Water: The Gulf Disaster and the Future of Offshore Drilling,
Report to the President, January, 2011.64
• Joint Investigation of Bureau of Ocean Energy Management, Regulation, and
Enforcement and U.S. Coast Guard.
• Volume I: U.S. Coast Guard, Report of Investigation into the Circumstances
Surrounding the Explosion, Fire, Sinking and Loss of Eleven Crew Members
Aboard the Mobile Offshore Drilling Unit Deepwater Horizon, April 2011.65
• Volume II: Bureau of Ocean Energy Management, Regulation, and
Enforcement, Report Regarding the Causes of the April 20, 2010 Macondo
Well Blowout, September 2011.66
• U.S. Coast Guard, On Scene Coordinator Report: Deepwater Horizon Oil Spill,
September 2011.67
• National Academy of Engineering and National Research Council, Macondo
Well—Deepwater Horizon Blowout: Lessons for Improving Offshore Drilling
Safety, December 2011.68
• Government Accountability Office, Interior Has Strengthened Its Oversight of
Subsea Well Containment, but Should Improve Its Documentation, February
2012.69
• Oil Spill Commission Action, Assessing Progress: Implementing the
Recommendations of the National Oil Spill Commission, April 2012.70
• Gulf Coast Ecosystem Restoration Council, The Path Forward to Restoring the
Gulf Coast: A Proposed Comprehensive Plan, January 2013.71
• U.S. Chemical Safety and Hazard Investigation Board: public release scheduled
for June 2014.72
62 See http://www.nrt.org.
63 See http://www.uscg.mil/foia/docs/DWH/BPDWH.pdf.
64 See http://www.oilspillcommission.gov/.
65 For cover letter, see http://www.boemre.gov/pdfs/maps/JointMemo092011.pdf; Volume I available at
https://homeport.uscg.mil.
66 See http://www.boemre.gov/pdfs/maps/DWHFINAL.pdf.
67 See https://homeport.uscg.mil.
68 See http://www.nae.edu/default.aspx?id=19649.
69 GAO-11-394T, February 2012. See http://www.gao.gov/products/GAO-12-244.
70 See http://oscaction.org.
71 See http://www.restorethegulf.gov/release/2013/01/29/path-forward-restoring-gulf-coast.
72 See http://www.csb.gov/statement-by-csb-chairperson-rafael-moure-eraso-on-fourth-anniversary-of-deepwater-
horizon-tragedy-in-gulf-of-mexico-csb-investigation-reports-to-be-released-at-june-5th-public-meeting-in-houston-
(continued...)
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Additionally, the U.S. Government Accountability Office (GAO) began to examine DOI
performance in the aftermath of the Deepwater Horizon events.73 Specifically, GAO listed DOI
offshore energy programs as part of its “High Risk” series for the first time in 2011, based on the
rationale that the combination of regulatory changes in the aftermath of the Deepwater Horizon
events warranted a close study of DOI agency performance in five areas: (1) reorganization, (2)
balancing responsibilities, (3) human capital, (4) revenue collection, and (5) development of
existing leases.74 GAO updated this report in 2013.75 The 2013 report announced GAO plans to
continue studying how all three DOI agencies (ONRR, BOEM, and BSEE) are performing by,
among other measures, “focusing on the causes of human capital challenges, actions taken, and
how DOI plans to measure the effectiveness of corrective actions.”76 GAO is expected to update
this report in 2015 at the start of the 114th Congress.77
Selected CRS Reports for Further Reading
Legislation
CRS Report R43137, Department of the Interior Ocean Energy Bureaus: Status of 2010
Structural Reforms and Issues for Congress, by Curry L. Hagerty.
CRS Report R41684, Enacted and Proposed Oil Spill Legislation in the 112th Congress, by
Jonathan L. Ramseur.
CRS Report R41453, Oil Spill Legislation in the 111th Congress, by Jonathan L. Ramseur.
2010 Deepwater Horizon Oil Spill
CRS Report R43380, Gulf Coast Restoration: RESTORE Act and Related Efforts, by Charles V.
Stern, Pervaze A. Sheikh, and Jonathan L. Ramseur.
(...continued)
texas/.
73 This information comes from GAO’s 2013 High Risk Report. This report is updated every two years, at the start of
each new Congress. GAO offers information on the High Risk series at http://www.gao.gov/highrisk/. See also 2013
Update to GAO’s High Risk List at http://www.gao.gov/multimedia/podcasts/652144.
74 See Gene L. Dodaro, U.S. Comptroller General, testimony before the House Committee on Oversight and
Government Reform, February 17, 2011; Committee on Appropriations, Subcommittee on Interior, Hearing March 17,
2011. According to Comptroller General Gene L. Dodaro’s testimony, GAO is analyzing the strengths and weaknesses
of DOI offshore oil and gas programs to understand the implications, if any, of the reorganization on cross-cutting
missions within DOI.
75 GAO-13-283 High-Risk Series. GAO reports that because of the progress that has been made, the scope has been
narrowed for certain areas on the 2013 High Risk List (GAO-13-283).
76 For information specifically on managing federal oil and gas resources, see the GAO report cited above, starting at
page 76. Other GAO reports on this subject include Oil and Gas Management: Interior’s Reorganization Complete, but
Challenges Remain in Implementing New Requirements GAO-12-423 (July 30, 2012); Interior Has Strengthened Its
Oversight of Subsea Well Containment, but Should Improve Its Documentation GAO-12-244 (February 29, 2012).
77 GAO-13-283 High-Risk Series (February 14, 2013) at p. 29.
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CRS Report R41679, Liability and Compensation Issues Raised by the 2010 Gulf Oil Spill, by
Jonathan L. Ramseur.
CRS Report R41531, Deepwater Horizon Oil Spill: The Fate of the Oil, by Jonathan L. Ramseur.
CRS Report R41972, The 2010 Deepwater Horizon Oil Spill: Natural Resource Damage
Assessment Under the Oil Pollution Act, by Adam Vann and Robert Meltz.
CRS Report R41234, Potential Stafford Act Declarations for the Gulf Coast Oil Spill: Issues for
Congress, by Francis X. McCarthy.
Background
CRS Report RL33705, Oil Spills in U.S. Coastal Waters: Background and Governance, by
Jonathan L. Ramseur.
CRS Report R41266, Oil Pollution Act of 1990 (OPA): Liability of Responsible Parties, by
Robert Meltz.
CRS Report R41370, Federal Civil and Criminal Penalties Possibly Applicable to Parties
Responsible for the Gulf of Mexico Oil Spill, by Robert Meltz.
CRS Report RL34209, Commercial Fishery Disaster Assistance, by Harold F. Upton.
CRS Report RL33404, Offshore Oil and Gas Development: Legal Framework, by Adam Vann.
CRS Report RS22022, Disaster Unemployment Assistance (DUA), by Julie M. Whittaker.
CRS Report R40645, U.S. Offshore Oil and Gas Resources: Prospects and Processes, by Marc
Humphries and Robert Pirog.
CRS Report R41132, Outer Continental Shelf Moratoria on Oil and Gas Development, by Curry
L. Hagerty.
Author Contact Information
Jonathan L. Ramseur
Curry L. Hagerty
Specialist in Environmental Policy
Specialist in Energy and Natural Resources Policy
jramseur@crs.loc.gov, 7-7919
chagerty@crs.loc.gov, 7-7738
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