Barbour to speak at House hearing on oil spill

[June 02, 2011]  WASHINGTON (AP) -- Mississippi Gov. Haley Barbour, once considered a challenger to President Barack Obama, heads a list of witnesses at a House investigative hearing where Republicans are expected to criticize the Obama administration's response to the Gulf oil spill last year and its handling of recovery operations.

Barbour, who has dropped out of the GOP presidential race, was to tell the House Oversight and Government Reform Committee on Thursday how his state has been affected by the April 20, 2010, Deepwater Horizon oil rig explosion that killed 11 workers and sent millions of gallons of oil spewing into the Gulf of Mexico.

"The BP oil spill was an economic disaster for Mississippi," Barbour says in prepared remarks, mentioning the hit on tourism and the drop in the number of deepwater drilling permits.

The hearing comes amid Republican demands that the administration do more to promote domestic oil production and disputes the White House position over how best to encourage drilling in the Gulf of Mexico and elsewhere.

A report prepared by the committee's Republicans and made available to The Associated Press says the suffering and loss from the environmental and economic disaster were made worse by the administration's legal response to the disaster, its reorganization of the federal agency regulating energy development and its banning of virtually all drilling activity in the Gulf.

The report expresses doubt about Obama's decision to give BP PLC, the owner of the well, the lead in responding to the spill rather than putting the federal government in charge. It also questions the independence of attorney Kenneth Feinberg, the claims administrator responsible for dispensing $20 billion in BP money to victims. It says the dispersals have been inconsistent and slow.

An Interior Department official has been invited to the hearing to present the administration side. The administration contends that its actions were legally determined by the Oil Pollution Act of 1990, enacted after the Exxon Valdez spill, which holds the party responsible for a spill accountable for the costs.

The Gulf Coast Claims Facility that Feinberg heads says that as of the end of May, it has paid almost $4.3 billion to settle 188,000 of some 514,000 claims.

Democrats, meanwhile, pointed out that one of the witnesses at the hearing, Craig Taffaro, is president of St. Bernard's Parish near New Orleans, who according to reports by The Washington Post and others was able to steer millions of dollars in BP money to local companies for cleanup operations.

The Republicans are also likely to stress that new regulations imposed on energy exploration have harmed the Gulf Coast economy. Last June, Obama announced a six-month moratorium on drilling in waters deeper than 500 feet. The moratorium was lifted in October, but there's been little new activity as drillers must meet new safety rules to obtain permits for previously suspended operations.

The administration says that since February, it has granted permits for 55 shallow-water wells and 15 deepwater wells that meet new safety standards for containment in the event of an accident.

The report cites an internal memo from Interior Secretary Ken Salazar last July in which he says he is aware that suspension of deepwater drilling "over the next few months will have a serious negative impact on rig workers and those who support them."

But it also notes that the Minerals Management Service, the regulatory agency that was reorganized in the wake of the spill, concluded in June last year that the long-term effects of the moratorium would not be that great on general employment because "some businesses may be willing (to) sustain short-term losses to avoid having to lay off and subsequently rehire workers."

The GOP-led House last month passed legislation to speed up decision-making on drilling permits and force previously scheduled lease sales. Similar legislation was defeated in the Senate, but Obama has directed the Interior Department to extend existing leases in the Gulf and off Alaska's coast and hold more frequent lease sales in a federal petroleum reserve in Alaska.

[Associated Press; By JIM ABRAMS]

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.