The U.S. Department of the Interior’s Bureau of Ocean Energy Management (BOEM) is seeking stakeholder input as it considers updating its bonding and financial assurance regulations for offshore oil and natural gas operations. BOEM manages the federal government’s financial risks related to offshore energy and mineral development.
In an Advance Notice of Proposed Rulemaking on Risk Management, Financial Assurance, and Loss Prevention (ANPR) published in today’s Federal Register,1 BOEM states that its current bonding and financial assurance regulations reflect the limited complexity and scope of the risks identified at the time the regulations were first implemented. Over the past 20 years, however, the risks associated with offshore oil and natural gas operations have become increasingly complex and costly. BOEM’s current regulations do not reflect current offshore infrastructure and operations, including deepwater operations, aging infrastructure, and decommissioning costs. BOEM is seeking to overhaul its outdated regulations.
The ANPR includes four main topics: (1) identification of pertinent risks/liabilities, (2) risk monitoring and risk management, (3) demonstration of financial assurance over project lifecycles, and (4) financial assurance, bonding levels, and requirements.
Although the ANPR focuses on BOEM’s bonding and financial assurance programs for offshore oil and natural gas operations, BOEM will also accept comments on its bonding and financial assurance programs for offshore renewable energy and hard minerals operations. BOEM’s oil spill financial responsibility (OSFR) regulations, however, are not part of this ANPR.
The 60-day comment period closes on Monday, October 20, 2014.