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Sen. Richard Shelby on oil spill impact

“Madame Chairman and Ranking Member Inhofe, thank you for allowing me testify before the committee today.

“On April 20, 2010, the Transocean-owned Deepwater Horizon drilling rig exploded, sending hundreds of thousands of gallons of oil toward our coastal shores, estuaries, and beaches. Alabama is bracing for the environmental and economic impact to our coastline. At this point, we do not know how severe the impact will be, nor can we estimate the long term effects. However, we have already seen evidence that this spill may devastate our Gulf Coast region – an area that has continually suffered one disaster after another.

“Madame Chairman, I traveled to Alabama and witnessed firsthand the destruction caused by this catastrophe. What I saw was disturbing. Even today, the oil continues to flow at a rate of 5,000 barrels a day. Tar balls have washed up on the shores of Dauphin Island, Alabama. As long as this oil continues to pour into the Gulf we have a real and unprecedented disaster.

“As we continue to respond to this disaster, our main objective must be to stop the flow of oil. I am concerned that initial reports of the complexity and volume of the spill were underestimated. It seems as if the amount of oil leaking from the wells more than tripled overnight. At this rate, the spill could easily eclipse the 1989 Exxon Valdez accident – the worst oil spill in U.S. history.

“Second, cleanup should be rapid and with as little environmental impact as possible. As the responsible party, BP must be held accountable and the federal government should ensure that BP upholds its financial obligations. I do not believe that BP, or any company for that matter, should solicit hazard mitigation solutions after an incident. Just as we would never send our warfighters into combat without a contingency plan, we should consider strengthening regulations on industries that engage in high-risk operations that affect our citizens and our environment.

“BP’s most promising solution for stopping the oil flow involved a 100-ton concrete-and-metal box designed to cover and capture the oil that’s now flowing into the Gulf. It failed over the weekend. Other suggestions as to how to clean up this mess have ranged from the entrepreneurial to the MacGyver-esque. Portions of the Florida coast will use bales of hay, while human hair clippings are being stuffed into casings to augment boom reserves, and pounds of peat moss are being considered to help soak up surface oil. This is not what we should expect from the world’s fourth most profitable company.

“Third, this oil spill could become our nation’s worst environmental disaster in decades. It already threatens hundreds of species of fish, marine life, birds, and other wildlife along the Gulf Coast. We need to ensure that techniques utilized in recovery efforts are safe and that we continue to do everything possible to protect our environmentally sensitive areas.

“We should address the recovery techniques used to clean up the oil slick. While dispersants may be the best action to mitigate the oil spill, we must understand what the long term effects will be on the ecosystem. It is my understanding that dispersants have never been used at this concentration and, thus far, it is publicly unknown what chemicals even make up the dispersants being used in the Gulf. All the facts must be provided to the public so we can have a full and complete picture about the environmental impacts dispersants may cause.

“Finally, we should make every effort to help our coastal communities get back on their feet with minimal disruption and financial harm. Fishermen are now placing booms in the Gulf instead of hooks. But, Madam Chairwoman, these jobs are only temporary. How will the fishing industry weather the potential economic disaster? And what will happen if Gulf seafood is contaminated and unable to be sold? During the beginning of the tourist season, the Alabama coast has already begun to deal with smaller beach crowds and rental cancellations. We need to plan for the long term impacts this accident will have on the Gulf Coast.

“In the wake of this accident, many are understandably concerned about the safety and environmental risks associated with offshore drilling. We are often quick to turn to reactionary and overly stringent public policy as a stopgap measure. Although my home state is affected, I caution against hasty reform. Simply halting all offshore development will not address our energy needs and would immediately increase our dependence on foreign oil. We cannot forget that our nation is still dependent on millions of barrels of oil every day from overseas. This accident should not be used as an excuse to halt the gains the United States has made in developing domestic energy sources. We must let the investigation into this accident move forward, and be careful to avoid rash or precipitous actions.

“Instead, we should proceed in a measured manner to fully understand the true cause of this accident and review procedures and protocols currently in place that oversee this industry. We need to ask several questions.

“First, why did this happen?

“We need to examine the role the Minerals Management Service, the agency responsible for both environmental enforcement and financial administration of offshore drilling leases, played in this accident. In 2008, the Minerals Management Service was exposed as “a cesspool of corruption and conflicts of interest,” with regulators routinely accepting gifts from oil and gas companies.

“US regulators did not mandate the use of a remote controlled device to shut down the well should the oil rig become damaged or require evacuation. Yet these devices are required by Norway and Brazil. While the efficacy of the device is unclear, the Minerals Management Service did consider requiring its use only to decide, “acoustic systems are not recommended because they tend to be very costly.” No one can state, unequivocally, that a remote control device would have prevented this disaster. But it is also unknown whether it would have provided a last-resort protection against underwater spills. Madame Chairman, it does not appear that the Minerals Management Service’s oversight is sufficiently protecting our nation from environmental disasters.

“Second, what role did BP play in this explosion?

“In 2007, Congress investigated one of the worst workplace accidents in the US, a massive explosion at BP’s Texas City Refinery in March 2005 that killed 15 people and injured 180. The US Chemical Safety Board, an independent federal agency investigated the accident and stated, “The Texas City disaster was caused by organizational and safety deficiencies at all levels of the BP corporation. The combination of cost-cutting, production pressures and failure to invest caused a progressive deterioration of safety at the refinery.” Was this lack of concern for safety part of BP’s corporate culture that translated to potential questionable standards on the rig? The Justice Department must continue their investigation to determine whether malfeasance occurred.

“Finally, is the Oil Spill Liability Trust fund adequate to deal with such disasters?

“Since the funds’ inception in 1986, the cost of cleanup for such severe environmental disasters has kept pace with inflation, while the cap on individual claims has not. While we should not be reactionary in our energy policy, our job as lawmakers is to examine where there are breaks in the chain, and to make sensible repairs.

“This accident serves as a reminder that there are risks involved in meeting our energy needs as a country. But even with this tragedy, the United States still has the most rigorous and robust environmental standards of any oil-producing country in the world.

“Madame Chairman, I speak today to remind the committee of the importance of proactive rather than reactionary measures; foresight rather than hindsight. I ask you to continue to consider the needs of our coast, as we move forward with our cleanup and restoration efforts.”