In a remarkable display of judicial activism, Judge Martin Feldman (a Reagan appointee) has thrown out the six-month moratorium on deepwater drilling imposed after the Transocean (RIG) Deepwater Horizon went down in flames while drilling a well for BP (BP). This is despite statutory language that states:
“OCSLA (the statute governing offshore drilling) instructs the Secretary of the Interior to prescribe regulations for the suspension or temporary prohibition of any operation or activity, including production, pursuant to any lease or permit . . . if there is a threat of serious, irreparable, or immediate harm or damage to life (including fish and other aquatic life), to property, to any mineral deposits (in areas leased or not leased), or to the marine, coastal, or human environment.”
Despite the fact that all the major oil companies simply cut and pasted their oil spill response plans from one another, including plans on what to do if walruses were affected by the spill (walruses have not been in the Gulf of Mexico since the last ice age), and despite the fact that all included the number of an expert who died five years ago on the contact list, the judge found that the spill was entirely idiosyncratic to BP and that it was unfair to impose a short wait to come up with better safety plans before going ahead with more drilling.
If the worst environmental disaster since Chernobyl is not proof of “a threat of serious, irreparable, or immediate harm or damage to life (including fish and other aquatic life),” then what the heck would be? Yes, BP made some specific engineering errors in how it dealt with this well, but how confident can we be in the rest of the industry without a full review?
It is abundantly clear that the industry has been left to its own devices for the last decade, with no real regulatory oversight. That was a deliberate policy of the last administration, and a policy that the current administration was far too slow to correct. What would happen if there were another blowout before the current one were plugged? Resources to deal with the current situation are already overstretched. That would be irreparable harm. Lost revenues for six months for the offshore drilling industry is hardly irreparable by contrast. It is not like the oil is going anywhere, it has been sitting under the sea for hundreds of millions of years.
The Obama Administration is appealing the ruling (click here for the full text of the ruling). I would expect that they will prevail. However, one cannot be too sure. It is abundantly clear that at least four members of the current Supreme Court are far more concerned about the rights of artificial legal people than they are of actual people who eat and breathe. In any case, this is not something where the judicial branch should be imposing its will on the elective branches of government. This is an incredibly activist decision.
That being said, I think we will need to drill offshore. We simply cannot afford to import all of our oil – and world oil supplies are running thin. However, it is clear that it has to be done safely and under tight regulation by regulators who actually care. Taking six months to figure out exactly what those regulations should be and how to implement them is entirely reasonable and not at all arbitrary and capricious. If this order is not overturned, and there is another spill, the oil will be on the hands of Judge Feldman.
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