Oil Companies Pay a Pittance in Penalties to Offshore Drilling Regulator

 

by Marian Wang

 

Men position oil boom barriers to contain the ongoing spill from BP's Deepwater Horizon platform. (Stan Honda/AFP/Getty Images)

Last week, as part of our coverage of the massive BP oil spill in the Gulf of Mexico, we noted the troubled past of the Minerals Management Service, the agency that regulates offshore oil and gas drilling.

On its website, MMS says that it issues civil penalties for serious safety violations [1]. And there have been violations. A study conducted by the Minerals Management Service found that from 2001 to 2007, offshore drilling accidents resulted in 41 deaths and 302 injuries [2], according to The Huffington Post.

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In an analysis of civil penalties levied by the regulator, we at ProPublica found that over the past 12 years the average penalty has been $45,000. Currently, MMS can fine oil and gas companies a maximum of $35,000 per violation per day [3] (PDF). The biggest fine an oil company has paid to the agency since 1998 was $810,000, paid in 2001 by Chevron. Overall, the Minerals Management Service has collected $20 million in penalties in those 12 years.

That kind of money is unlikely to sting much, considering the profits that major oil companies take in.

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