BOEMRE raises civil penalties for OCSLA, OPA violations

The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) said today that it will raise the maximum civil penalty rate for Outer Continental Shelf Lands Act (OCSLA) violations from $35,000 to $40,000 per day; and from $25,000 to $30,000 per day for Oil Pollution Act (OPA) financial responsibility violations. The increases coincidewith adjustments in inflation, as required by OCSLA and OPA.

The Secretary of Interior can adjust the maximum civil penalties for OCSLA violations every three years to reflect increase in the Consumer Price Index (CPI). Similarly, OPA penalties can be adjusted every four years.

In the wake of the Macondo incident, the Obama administration wants Congress to pass legislation to further raise the maximum civil penalty rates beyond the rate of inflation.

“Even with the inflation adjustment, which is the limit of our current regulatory authority, our civil fine authority is inadequate,” says BOEMRE Director Michael Bromwich. Bromwich says “the inadequacy of our civil authority hampers our ability to effectively regulate offshore activities, and renders such fines a trivial nuisance rather than an effective deterrent.”

He would like to see new legislation passed to raise civil penalties to act as a stronger deterrent to safety and environmental violations.

BOEMRE can impose civil penalties when an operator fails to correct a recorded violation or commits a violation that constitutes a threat of serious, irreparable, or immediate harm or damage to life, property, any mineral deposit, or the marine, coastal, or human environment. BOEMRE also imposes fines if there is evidence that operators do not have adequate financial responsibility to meet maximum liability amounts contained in OPA. Fines are assessed on a maximum per day rate, but can be compounded if there are multiple infractions.

June 29, 2011