President Barack Obama’s fiscal year 2016 (FY 2016) budget includes a request of $170.9 million to fund the Bureau of Ocean Energy Management.
The President’s budget request focuses on program responsibilities, such as the Five Year Outer Continental Shelf Oil and Gas Program, oil and gas exploration and development plans, offshore renewable energy and environmental analysis and studies. The request includes an increase of $1.1 million over the FY 2015 enacted level, allowing the bureau to fund important initiatives to further develop the risk management program, add personnel needed to support an increase in OCS activity and build on the bureau’s collaborative efforts in ecosystem science.
The budget includes $2.5 million in additional funding that will allow BOEM to operate a more robust risk management program. Initiated in FY 2014, the program seeks to modernize the bureau’s approach to offshore oil and gas financial assurance and risk management in order to better align with the realities of aging offshore infrastructure, and to address potential costs and liabilities associated with offshore energy development.
BOEM-regulated OCS activities have increased in recent years and this trend is expected to continue. Since 2010, BOEM has seen a 36 percent increase in active deepwater drilling rigs in the Gulf of Mexico, leading to a steady increase in the number of plans BOEM must review. The President’s proposal requests $1.1 million to support increasing activity on the OCS and an increased workload resulting from focusing personnel on the timely and thorough completion of reviews of exploration and development plans.
Included in the FY 2016 request is an additional $500,000 to support the bureau’s role in supporting the United States during its term as Chair of the Arctic Council and to increase its expertise on ecosystem science.
The President’s $170.9 million budget request includes offsetting collections of $93.0 million from rental receipts and $3.7 million from cost recovery fees. This results in a requested increase of $1.8 million in net direct appropriations for the bureau. The President’s proposal also includes a package of legislative and administrative reforms to bolster and backstop administrative actions being taken to reform the management of Interior’s onshore and offshore oil and gas programs, with a key focus on improving returns to taxpayers from the sale of these Federal resources and on improving transparency and oversight.
President Obama’s fiscal year 2016 budget request for the Bureau of Safety and Environmental Enforcement (BSEE) is $204.7 million.
By the end of 2014, there were 69 deepwater rigs and non-rig units working in the Gulf of Mexico, up from 40 at the start of the year. The Energy Information Administration projects offshore production will continue to grow through 2040, as the pace of development activity quickens and new, large development projects, predominantly in the deepwater and ultra-deepwater areas of the Gulf of Mexico, are brought into production.
The 2016 budget focusses on risk reduction. The Bureau will bolster its capacity for analyzing data gained through incident reporting requirements, near-miss reporting, and real-time monitoring. The Bureau will also continue to work with industry to better understand their safety processes, so that BSEE can mitigate and reduce risk. Through these initiatives and others, BSEE will continue to ensure that offshore development occurs in a safe and environmentally responsible way.
The 2016 budget request includes an increase of $1.7 million to establish the Engineering Technology Assessment Center to support the evaluation of new and emerging technologies and develop associated safety and oversight protocols. The increased funding will add greater depth and capacity to the BSEE, so that as industry continues to innovate and develop new capabilities, the BSEE will be able to keep pace. The Center will provide a Bureau-wide focal point for emerging technology evaluation. The FY 2016 request also better aligns inspection fees with BSEE’s risk-based approach to inspections and compliance.
Anticipated fixed cost increases are funded at $1.4 million. BSEE’s targeted funding increases are largely offset by anticipated savings from continued management efficiency efforts (-$2.4 million) and a reduction in offsetting collections funding (-$1.4 million), for a net funding increase of $46,000 over the 2015 enacted level.
The President’s budget proposes $14.9 million for Oil Spill Research, equal to the 2015 enacted level. The Oil Spill Research program plays a pivotal role in initiating applied research used to support decision-making on methods and equipment to prevent or mitigate oil spills, which is a component of the offshore permitting process. The request will address key knowledge and technology gaps in oil spill response, focusing on deepwater and Arctic environments.
Additional details on the President’s FY 2016 budget requests for BOEM and BSEE are available here.
