BOEM Adjusts Level of Civil Monetary Penalties for Oil & Gas Companies

Increase keeps pace with inflation, preserves deterrent effect

02-14-2017

Contacts: Connie Gillette
202-208-5387

The Bureau of Ocean Energy Management (BOEM) today announced a Final Rule that adjusts the level of civil monetary penalties in accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act (FCPIA) of 2015.

The FCPIA of 2015 amends the Federal Civil Penalties Inflation Adjustment Act of 1990 and requires Federal agencies to adjust the level of civil monetary penalties with a “catch-up” adjustment through an interim final rulemaking (IFR) in 2016, and make subsequent annual adjustments for inflation, beginning in 2017. These adjustments are intended to maintain the deterrent effect of civil penalties and to further the policy goals of the underlying statutes.

BOEM issued an IFR on July 1, 2016 and asked for comments from the public. Because BOEM did not receive any comments on the IFR, which implemented the inflation adjustment for 2016, we will adopt and finalize that IFR without change and implement the statutory directive in the FCPIA of 2015. The directive requires agencies to publish updates to their civil monetary penalty amounts for 2017 by applying a specified inflation factor. BOEM has no discretion to vary the amount of the adjustments.

The Final Rule will be available via the Federal Register on February 15.

Under the FCPIA of 2015, this rule adjusts the maximum civil monetary penalties per day per violation to $42,704 for violations under the OCS Lands Act and to $45,268 for violations under the Oil Pollution Act of 1990.

Questions about the Final Rule can be addressed by Robert Sebastian, Office of Policy, Regulation and Analysis at (202) 513-0507 or email at robert.sebastian@boem.gov.