BOEM Publishes Proposed Adjustment to Limit of Liability for Offshore Facilities that Cause Oil Spills

Increase needed to keep pace with inflation, preserve deterrent effect

02-21-2014 WASHINGTON

Contact:Connie Gillette, 202-208-5387

As part of the Obama Administration's ongoing efforts to ensure the safe and responsible production of domestic offshore energy resources, the Bureau of Ocean Energy Management (BOEM) is proposing to administratively increase the limit of liability for oil-spill removal costs and related damages from $75 million to approximately $134 million. The increase would apply to offshore facilities in federal and state waters under the Oil Pollution Act of 1990, and is consistent with recommendations from the National Commission on the BP Deepwater Horizon Oil Spill and other studies that called for a statutory increase in the limit of liability.

“This proposed change is the first administrative increase to the liability cap since the Oil Pollution Act came into effect twenty-four years ago and is necessary to keep pace with the 78 percent increase in inflation since 1990,” said BOEM Director Tommy P. Beaudreau. “This adjustment helps to preserve the deterrent effect and the ‘polluter pays’ principle embodied in the law.”

The rule would also establish the methodology BOEM would use for future inflation adjustments to the liability cap. The Department of the Interior has determined that these changes would further protect the environment by ensuring that any party that causes an oil spill would pay an increased amount of any potential damages. The adjustment is the maximum increase that may be implemented without legislation.

BOEM is publishing this proposed update to its regulations and is soliciting public comments on the adjustment methodology, the clarity of the rule and any other pertinent matters.

Comments may be submitted in one of four ways: In person, via mail, via email or via the internet. Regulation Identifier Number (RIN) 1010–AD87 should be included in any submission. Venues for submission are as follows:

  • Federal eRulemaking Portal: http://www.regulations.gov. In the entry entitled, “Enter Keyword or ID,” enter BOEM-2012-0076, then click search. Follow the instructions to submit public comments and view supporting and related materials available for this rulemaking. BOEM will post all comments received during the comment period.
  • Mail or hand-carry comments to the Department of the Interior; Bureau of Ocean Energy Management; Attention: Peter Meffert, Office of Policy, Regulations and Analysis (OPRA); 381 Elden Street, MS-4001, Herndon, Virginia 20170-4817. Please reference “Consumer Price Index Adjustments of the Oil Pollution Act of 1990 Limit of Liability for Offshore Facilities” in your comments and include your name and return address so that we may contact you if we have questions regarding your submission.
  • E-mail comments to the Department of the Interior; Bureau of Ocean Energy Management; Attention: Peter Meffert, Office of Policy, Regulations and Analysis (OPRA) at peter.meffert@boem.gov.

Comments will be made publicly available.

The Bureau of Ocean Energy Management (BOEM) promotes energy independence, environmental protection and economic development through responsible, science-based management of offshore conventional and renewable energy resources.