Departments of the Interior and Commerce Sign MOU to Improve Coordination on Offshore Energy Development

On May 23, 2011, the U.S. Department of the Interior (DOI), Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) and the Department of Commerce, National Oceanic and Atmospheric Administration (NOAA) announced that they have entered into a memorandum of understanding to broaden and enhance their coordination and collaboration to ensure environmentally sound offshore energy development.  Under this “Memorandum of Understanding on Coordination and Collaboration Regarding Outer Continental Shelf Energy Development and Environmental Stewardship” (MOU), BOEMRE and NOAA will work together to share scientific information and expertise in energy-related programs and environmental analyses on the outer continental shelf (OCS). 

Although BOEMRE and NOAA have a long history of collaboration, the MOU is intended to further strengthen their coordination on science and agency priorities.  Specifically, the MOU aims to ensure that the agencies fulfill their responsibilities with respect to the stewardship and conservation of marine resources and ecosystems by basing their decision-making relating to the development of energy resources on the OCS on relevant scientific information and their collective expertise.  This increased coordination also could bring greater efficiencies to the planning, permitting, and monitoring of both oil and gas and renewable offshore energy development activities.

BACKGROUND

Under the Outer Continental Shelf Lands Act, BOEMRE (formerly the Minerals Management Service) grants leases, easements, and rights-of-way for offshore oil and gas operations and renewable energy projects on the OCS.  As the manager of energy-related activities on the OCS, BOEMRE is responsible for ensuring that OCS resources are made available for development in a timely and efficient manner and for ensuring that such development is undertaken in a safe and environmentally responsible manner.  NOAA is responsible for understanding and predicting changes in the environment, as well as conserving and managing coastal and marine ecosystems and resources, under a number of federal statutes. 

In July 2010, President Obama signed Executive Order 13547 establishing a national policy for the “Stewardship of the Ocean, Our Coasts, and the Great Lakes,” and adopting the Final Recommendations of the Interagency Ocean Policy Task Force (National Ocean Policy).  Among other things, the National Ocean Policy calls for enhanced coordination and collaboration across the Federal government to facilitate cohesive actions with regard to the stewardship and development of the ocean, coasts, and Great Lakes.

The MOU is consistent with the National Ocean Policy and with recommendations of the final report of the National Commission on the Deepwater Horizon Oil Spill and Offshore Drilling, issued earlier this year.  That report highlighted that, because BOEMRE is not required to accept NOAA recommendations on where or when to lease portions of the OCS, NOAA’s scientists had little more influence than the general public.  Accordingly, the report recommended increasing NOAA’s role in the OCS oil and gas decision-making process by strengthening interagency consultation. 

MEMORANDUM OF UNDERSTANDING

The purpose of the MOU is to ensure that regulatory decisions regarding energy development on the OCS are based on sound science and multi-agency cooperation.  The MOU identifies a number of general objectives, including:  defining processes for communication of agency priorities and activities; cooperating on environmental documents under the National Environmental Policy Act (NEPA), including sharing of information; collaborating on scientific, environmental, and technical issues related to the development and deployment of offshore renewable energy technologies; and increasing coordination and collaboration on decisions related to OCS activities. 

Specific collaborative activities envisioned by the MOU, which is to remain in effect for five years, include:

• BOEMRE, as the lead agency for NEPA analysis related to offshore activity, will invite NOAA to be a cooperating agency in the NEPA process;
• NOAA, in return, will invite BOEMRE to be a cooperating agency for any matter under NOAA’s jurisdiction relating to OCS energy development;
• BOEMRE must explain in writing any decision not to incorporate a NOAA comment into a BOEMRE environmental document, and NOAA will have an opportunity to respond before the document is finalized;
• NOAA will designate an official to participate in BOEMRE OCS energy-related programs and environmental analyses;
• BOEMRE will invite NOAA to participate in intergovernmental initiatives on renewable and alternative energy activities;
• the agencies will coordinate on separate agreements between DOI and the Department of Energy (DOE) on the coordinated deployment of offshore wind and marine and hydrokinetic technologies, and between NOAA and DOE on weather-dependent and oceanic renewable energy resources, to promote tri-agency collaboration;
• BOEMRE and NOAA will convene quarterly leadership meetings to discuss emerging OCS issues, and will annually evaluate activities and progress related to National Ocean Policy objectives; and
• BOEMRE and NOAA will participate in oil spill drills and oil spill response working groups to discuss oil spill cleanup and response technologies.

IMPLICATIONS

The MOU appears to signal an effort by BOEMRE, in this post-Deepwater Horizon oil spill era, to ensure that its regulatory decisions are based on the best available science relating to ocean resources.  This, of course, targets one of the major criticisms leveled against the agency’s predecessor in the aftermath of last year’s rig collapse and spill.  It also potentially raises the bar for offshore energy project developers to design their projects in a manner that appropriately considers and mitigates against environmental concerns that may be identified through this heightened focus on scientific information.

While the stated intent and focus of the MOU is to improve stewardship and conservation of marine resources and ecosystems, the enhanced coordination between BOEMRE and NOAA envisioned by the MOU also could result in added efficiencies in the planning, permitting, and monitoring processes for both oil and gas and renewable energy development on the OCS.  For instance, the MOU envisions that the agencies will align their regulatory activities and decision-making processes and develop consistent procedures for monitoring and mitigation measures for OCS energy development activities.  In addition, by encouraging BOEMRE and NOAA to engage early on in the decision-making process, and to rely on or incorporate each other’s NEPA documents, the MOU could improve the agencies’ coordination and identification of environmental issues and streamline their respective approval processes.

The potential burdens and benefits associated with the MOU, at this time, however, remain uncertain.  Also unclear is how this MOU will relate to the agreement entered into between BOEMRE’s predecessor and the Federal Energy Regulatory Commission in 2009 regarding leasing and licensing for marine and hydrokinetic energy projects on the OCS.  The true impacts of the MOU on offshore energy project development will become clearer as the agencies work to implement the agreement.