Bills targeting oil industry move forward in House committees

Far-reaching legislation that would impose new environmental safeguards on offshore drilling, repeal oil-industry-friendly provisions of energy policy and hit producers with a new tax to fund conservation programs gained ground in Congress on Thursday.

Acting as BP at least temporarily halted the flow of oil from its blown-out well, two House committees advanced legislation from a pile of oil-spill-related bills.

One bill, approved by the Natural Resources Committee on a largely party-line vote, would strip the oil industry of royalty relief for deep-water drilling. It would repeal a provision of the 2005 Energy Policy Act that exempted projects, including the Deepwater Horizon drilling, from detailed environmental analysis. It would also bar companies with poor environmental and safety records from bidding on future offshore oil and gas leases.

The bill would provide $900 million a year, about triple the amount provided this year, to purchase land for national parks, forests and wildlife refuges and to help states fund parks and recreation projects. The money would come from a $2-per-barrel “conservation fee” on the domestic production of oil.

Another bill, approved with bipartisan support by the Energy and Commerce Committee, would impose new standards on blowout preventers and new requirements for safe well design and cementing, among other things.

The legislation grows out of the committee investigation into what Chairman Henry A. Waxman (D-Beverly Hills) called “a series of reckless decisions” by BP that led to the explosion of the Deepwater Horizon that left 11 people dead and started the worst offshore oil spill in U.S. history.

“Under this legislation, neither BP nor any other company would be able to make these same mistakes again,” Waxman said.

A staff report to committee members said BP had made numerous decisions that “increased the risk of a well control problem, while neglecting additional safety precautions” before the explosion.

“BP chose a well design that had only two barriers to prevent flow of dangerous gases instead of using a design that had multiple barriers; BP ignored the advice of its contractor, Halliburton, and chose a cement sealing approach for the well that was predicted to fail; BP failed to conduct a key test to evaluate the sufficiency of the cementing job; BP failed to fully circulate well fluids to facilitate better cementing; and BP did not install a key piece of equipment at the wellhead prior to the explosion,” the staff said in a report. “All of these decisions saved time and money for BP, but increased risks.”

The legislative drive came as a group of senators asked the Senate Judiciary Committee to investigate potential conflicts of interest with judges who will oversee spill cases, including the federal judge who struck down a drilling moratorium.

Also, California Democratic Sens. Barbara Boxer and Dianne Feinstein called on the Senate Foreign Relations Committee to investigate whether BP lobbied for the release of terrorist Abdel Basset Ali Megrahi, convicted in the 1988 bombing of a Pan Am jet over Lockerbie, Scotland, that killed 270, in an effort to gain favor with Libya to drill off its coast.

In the House Natural Resources Committee, Republicans and the oil industry accused the Democratic majority of acting in haste before the causes of the rig explosion were known. “Reforms are clearly needed, but Congress shouldn’t get ahead of the facts,” said the panel’s top Republican, Doc Hastings of Washington state.

The American Petroleum Institute said the bill would “penalize the entire oil industry” for the Deepwater Horizon spill and “threaten American jobs, the nation’s economy and its energy security.”

The provision to bar a company from bidding on offshore leases

would apply to any company whose record indicated five times the industry average for willful or repeated worker safety violations at its oil and gas facilities, if more than 10 fatalities occurred at any of its facilities, or if it incurred fines of $10 million or more under the Clean Air or Clean Water acts within the preceding seven years.

A BP spokesman declined to comment.

Hastings objected to the conservation funding, saying it had “no place in a bill intended to focus on the gulf oil spill.”

The Santa Monica Mountains National Recreation Area is among the parks that could benefit from the increase in conservation funding.

richard.simon@latimes.com