Bud's Offshore Energy (BOE)

The subject IEc report for the US Coast Guard may be of interest to BOE followers. The Coast Guard is requesting comments by July 28, 2026. You can download the full report (129 pages) here.

The report is intended to update the Coast Guard’s methodology for estimating the cost savings resulting from spill prevention regulations. The paragraph pasted below is a good summary of the objective.

The offshore industry could benefit from this report, because the estimated cost of spills >100 gallons is reduced, dramatically so when the DWH/Macondo blowout is excluded (see the second table below). That reduction would support regulatory reform initiatives, and could thus generate some controversy.

My main concern is that there is only a single distance-from-shore category for offshore spills (see text below). The natural resources damage from a spill 3 miles from shore will almost always be much greater than from an equivalent volume spill 100 miles from shore.

The single-offshore-category issue is illustrated in the 2 tables pasted below. The first table presents a summary of expert opinions on the smallest spill size that is likely to result in measurable natural resource damages. The mean response to Question 3 (offshore) is 7782 gallons. A spill of that size occurring 3 miles from shore is much more likely to result in resource damage than a spill originating 50 or 100 miles from shore.

In the second table, note the new methodology results in the same cost estimates for large nearshore/coastal spills as for offshore spills. Again, this is presumably because there is only a single offshore category.

The public comments on this report should be interesting.