(Remarks as prepared for delivery)
Today, we will hear from the distinguished co-chairs of the Commission on the BP Deepwater Horizon Oil Spill and offshore drilling about their report to the President on the Deepwater Horizon disaster.
This Committee has previously heard testimony about the heartbreaking economic and resource damages caused by this oil spill and the need to ensure that the people whose jobs and livelihoods are impacted are made whole again.
The Commission’s report and its recommendations underscore the work that remains to be done to minimize the chance of another disaster like the one we witnessed last year. The report highlights the safety and environmental risks associated with offshore drilling and spotlights the systemic lapses that led to the tragic Deepwater Horizon spill.
The report lays out a comprehensive set of recommendations to improve the safety of offshore drilling, to hold oil companies accountable when things go wrong, and to protect jobs, coastal communities and the environment.
The Commissioners recommend that Congress take steps to restore the Gulf Coast, including dedicating a significant portion of Clean Water Act penalties to the restoration of the Gulf’s damaged ecosystems. I support efforts to restore the Gulf coast and look forward to working with colleagues on a proposal that promotes the restoration of economically and environmentally important ecosystems in the Gulf of Mexico.
The Commission’s report also urges Congress to act to increase the outdated limits on liability in the Oil Pollution Act. Under current law, an oil company’s liability for economic and natural resources damages from an oil spill disaster is only $75 million. This is astounding when total damages for the BP Deepwater Horizon spill could total in the tens of billions of dollars.
According to the Commission’s report, current liability limits distort safety incentives for companies drilling offshore and fail to provide assurances to those impacted by a spill that all damages will be compensated.
Legislation introduced by Sen. Menendez, the Big Oil Bailout Prevention Unlimited Liability Act of 2011 (S. 214), has been referred to the EPW Committee for consideration. The bill would remove the current limits on liability to ensure taxpayers are not left on the hook for damages from oil spills.
The Committee reported this legislation in the last Congress, and it is important that we once again take action to ensure those impacted by a spill due to no fault of their own are made whole.
Working collaboratively, I believe we can find ways to address oil company liability in a way that ensures businesses, particularly small and independent operators, are able to maintain their economic competitiveness.
For example, the Commission’s report recommends the establishment of a mutual insurance pool that allows offshore operators to pool risk and share the liability for any damages associated with an oil spill.
Senators Landrieu and Begich have already begun developing such a proposal. I plan to continue working with them and other colleagues as we seek to address this issue.
The Commission report also includes important recommendations on improving oil spill research, reforming environmental review of offshore drilling, updating Federal oil spill response efforts, and better evaluating the use of dispersants.
Many of the Commission’s recommendations were addressed in legislation reported by this Committee in the last Congress. I am committed to working with my colleagues in the Senate to again move forward on legislation that holds oil companies accountable while protecting jobs, coastal communities and the environment.
I look forward to hearing from our witnesses today about the Commission's recommendations.