Thirteen years ago, on April 20, 2010, an explosion tore through BP’s Deepwater Horizon drilling rig, killing eleven people and spewing over four million barrels of oil into the Gulf of Mexico. This anniversary is relevant to the permit reform debate.
After the accident, as first responders and volunteers mopped oil from beaches and wildlife, an illustrious seven-member Commission conducted a six-month investigation into the accident. The 381-page report concluded, first and foremost, that the accident could have been prevented. The immediate causes of the Macondo well blowout were attributed to a series of identifiable mistakes that revealed “systemic failures in risk management.” One of those failures was the permitting system for deepwater drill rigs in the Gulf of Mexico.
Three systemic flaws plagued the permitting system and contributed to the accident. First, due to a series of political decisions and policies intended to expedite drilling permits in the Gulf of Mexico, the Deepwater Horizon well never underwent the “hard look” required by the National Environmental Policy Act (NEPA). Second, the primary regulating agency, Minerals Management Service (MMS) lacked capacity to perform its oversight responsibilities due to underfunding, insufficient technical expertise, and conflicting priorities. Third, deepwater drilling technology evolved far more rapidly than the regulations designed to control it, resulting in risks that neither industry nor the government had adequately considered. Without public scrutiny that the NEPA process would have imposed, these risks went unnoticed and unmitigated. Each of these flaws are relevant to the current discussion of permit reform.
In hindsight, permitting the Macondo well was obviously a “major Federal action significantly affecting the quality of the human environment.” This should be the trigger for a “hard look” under NEPA, which requires public consideration of a project’s environmental impacts, alternatives, and mitigation measures. However, the risks of the Macondo well, which was drilled 5,000 feet below the Deepwater Horizon drill rig and 13,000 feet beneath the crust of the earth, were never meaningfully or publicly considered due to a statutory exemption and a vast categorical exclusion significantly reducing the rigor of the environmental analysis required under NEPA.
Focus on permitting speed exacerbated the problem. Agency staff within the Minerals Management Service (MMS), which was the federal agency primarily responsible for leasing, safety, environmental compliance, and royalty collection for offshore drilling at the time, were discouraged from reaching conclusions about potential environmental impacts that would increase the burden on lessees and create “unnecessary delays for operators.” Scientific findings were reportedly changed or minimized to expedite plan approvals. In some cases, employee performance plans and monetary awards were based on meeting deadlines for leasing or development approval. The practice within MMS was to ensure that each permit received a “green light” as quickly as possible. In other words, the permitting agency prioritized speed over scrutiny.
A lack of capacity made matters worse. Setting culture aside, as a practical matter, MMS personnel lacked the resources and technological expertise to engage in a meaningful permit review. In the decade and a half before the explosion, MMS did not grow at the same pace as the industry. For example, between 2005-2009, the number of applications for permits to drill in the New Orleans District grew from 1,246 to 2,136—a 71 percent increase. Without sufficient staff, safety regulations lagged behind technological developments to the point that the regulations did not reflect what was happening in the field. Additionally, agency personnel responsible for analyzing the well permit lacked the training or expertise to understand the implications of the technology being used. In other words, the permitting agency lacked capacity and expertise to effectively analyze the permits submitted to them.
Due the NEPA streamlining procedures, short review deadlines, and insufficient agency capacity at MMS, risks that might have been exposed through the NEPA process went undetected. Notably many of the recommendations made by the Deepwater Horizon Commission including whistle blower protections, more time for the agency to review exploration plans, and strengthening NEPA, never came to fruition. Others were rolled back under the Trump Administration.
How does this history lesson apply to permit reform? It serves as a potent reminder that good decisions are more important than fast decisions. Many reform proponents emphasize statutory exemptions for favored projects, expanding the use of categorical exclusions, imposing short deadlines and page limits, restricting public comment opportunities, and reducing the rigor of environmental analysis. As the Deepwater Horizon example demonstrates, these reform proposals are likely to underestimate risks and overlook problems.
Jamie Pleune is an associate professor of law (research) and a member of the Law and Policy Group in the Wallace Stegner Center.
 See e.g., The Building U.S. Infrastructure through Limited Delays and Efficient Reviews (BUILDER) Act (H.R. 2515) available at https://transportation.house.gov/builder-act/default.aspx (last visited Mar. 17, 2023).