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Posted on 23 March 2011

Ensco win forces BOEMRE to take action on permits

Ensco won a motion for a preliminary injunction in mid-February against the US Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE), which has been ordered to take action on five of Ensco’s pending drilling permit applications within 30 days and to report its compliance to the court. In granting the motion, US District Court Judge Martin Feldman noted that, under the Outer Continental Shelf Lands Act, the government is under a duty to act by either granting or denying a permit application within a reasonable time. “Not acting at all is not a lawful option,” the ruling stated.

The court also agreed that 30 days is “a common sense marker” of the speed at which applications should be approved or denied – the same as the 30-day time period Congress has mandated in which the BOEMRE must act on exploration plans. Before Macondo, permits were processed in about two weeks. Yet five permits relating to Ensco’s deepwater rigs have been pending from four to nine months – a time frame the judge called “unreasonable, unacceptable and unjustified.”

Senators urge Salazar to streamline permit approvals

A bipartisan group of US Senators, led by Kay Bailey Hutchison (R-Texas) and Mary Landrieu (D-La.), urged the US Department of the Interior (DOI) to streamline the review process for shallow-water and deepwater drilling applications and provide adequate guidance to those seeking new permits.

Sens. Hutchison and Landrieu were joined by Sens. Mark Begich (D-Alaska), Thad Cochran (R-Miss.), John Cornyn (R-Texas), Lisa Murkowski (R-Alaska), Jeff Sessions (R-Ala.), Richard Shelby (R-Ala.), and Roger Wicker (R-Miss.) in introducing a Senate resolution urging timely review of applications.

The resolution also requests that Interior Secretary Ken Salazar provide the industry with a sample application to be used as a template.

Last year, the lawmakers introduced a similar resolution and urged the DOI to provide guidance to industry as to how new requirements can be satisfied. However, to date the department’s new requirements have not been clearly outlined, which has prevented applications from being approved. As a result, at least 12 rigs have left the Gulf of Mexico.

“In spite of the offshore drilling moratoria being lifted, permit delays are causing rigs to sit idle and threatening to send American jobs and tax revenue overseas,” Sen. Hutchison said.

“This de facto shallow-water drilling moratorium is having a painful impact on the Gulf Coast’s economy… I don’t know how much more it will take before this administration understands the harsh consequences of its intransigence,” Sen. Landrieu commented.

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