For the first time in the history of the US OCS program, Federal ontracts have been awarded for the decommissioning of facilities in the Matagorda Island area of the Gulf of Mexico. The use of taxpayer funds for this purpose should be an embarrassment for the offshore industry and its regulators, past and present.
Rather than touting these contracts, the regulators should be explaining how this happened and how it will be prevented in the future. Fortunately, BOEM’s proposed decommissioning financial assurance rule is open for comment until the end of this month, so we have an opportunity to provide input.
Matagorda Island Gas, the company whose wells the public will be plugging, had a poor compliance record, and is another example of why compliance should be a primary factor in determining supplemental financial assurance requirements.
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