[Senate Hearing 111-1240]
[From the U.S. Government Publishing Office]










                                                       S. Hrg. 111-1240

     FEDERAL RESPONSE TO THE RECENT OIL SPILL IN THE GULF OF MEXICO

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                              MAY 18, 2010

                               __________

  Printed for the use of the Committee on Environment and Public Works






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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                     ONE HUNDRED ELEVENTH CONGRESS
                             SECOND SESSION

                  BARBARA BOXER, California, Chairman
MAX BAUCUS, Montana                  JAMES M. INHOFE, Oklahoma
THOMAS R. CARPER, Delaware           GEORGE V. VOINOVICH, Ohio
FRANK R. LAUTENBERG, New Jersey      DAVID VITTER, Louisiana
BENJAMIN L. CARDIN, Maryland         JOHN BARRASSO, Wyoming
BERNARD SANDERS, Vermont             MIKE CRAPO, Idaho
AMY KLOBUCHAR, Minnesota             CHRISTOPHER S. BOND, Missouri
SHELDON WHITEHOUSE, Rhode Island     LAMAR ALEXANDER, Tennessee
TOM UDALL, New Mexico
JEFF MERKLEY, Oregon
KIRSTEN GILLIBRAND, New York
ARLEN SPECTER, Pennsylvania

                    Bettina Poirier, Staff Director
                 Ruth Van Mark, Minority Staff Director
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                            C O N T E N T S

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                              MAY 18, 2010
                           OPENING STATEMENTS

Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...    71
Cardin, Hon. Benjamin L., U.S. Senator from the State of Maryland    75
Voinovich, Hon. George V., U.S. Senator from the State of Ohio...    80
Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota....    83
Alexander, Hon. Lamar, U.S. Senator from the State of Tennessee..    87
Lautenberg, Hon. Frank R., U.S. Senator from the State of New 
  Jersey.........................................................    90
Udall, Hon. Tom, U.S. Senator from the State of New Mexico.......    95
Baucus, Hon. Max, U.S. Senator from the State of Montana.........   101

                               WITNESSES

Jackson, Hon. Lisa, Administrator, U.S. Environmental Protection 
  Agency.........................................................     1
    Prepared statement...........................................     4
    Responses to additional questions from:
        Senator Boxer............................................    13
        Senator Carper...........................................    17
    Response to an additional question from Senator Cardin.......    18
    Responses to additional questions from Senator Whitehouse....    19
Sutley, Hon. Nancy, Chair, Council on Environmental Quality......    22
    Prepared statement...........................................    24
    Responses to additional questions from:
        Senator Boxer............................................    30
        Senator Carper...........................................    33
Salazar, Hon. Ken, Secretary, U.S. Department of the Interior....    38
    Prepared statement...........................................    42
    Responses to additional questions from:
        Senator Boxer............................................    52
        Senator Carper...........................................    60
        Senator Cardin...........................................    66
Neffenger, Peter V., Rear Admiral, Deputy National Incident 
  Commander, Deepwater Horizon Oil Spill Response, U.S. Coast 
  Guard..........................................................   112
    Prepared statement...........................................   115
    Responses to additional questions from:
        Senator Boxer............................................   123
        Senator Carper...........................................   141
        Senator Whitehouse.......................................   146
        Senator Inhofe...........................................   156
Darcy, Hon. Jo-Ellen, Assistant Secretary of the Army (Civil 
  Works).........................................................   158
    Prepared statement...........................................   160
    Responses to additional questions from Senator Carper........   163
Fernandez, Hon. John, Assistant Secretary of Commerce for 
  Economic Development, Economic Development Administration......   168
    Prepared statement...........................................   170
    Responses to additional questions from Senator Carper........   178

 
     FEDERAL RESPONSE TO THE RECENT OIL SPILL IN THE GULF OF MEXICO

                              ----------                              


                         TUESDAY, MAY 18, 2010

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The full Committee met, pursuant to notice, at 2:30 p.m. in 
room 106, Dirksen Senate Office Building, Hon. Barbara Boxer 
(Chairman of the full Committee) presiding.
    Present: Senators Boxer, Inhofe, Baucus, Voinovich, Carper, 
Lautenberg, Alexander, Vitter, Cardin, Klobuchar, Whitehouse, 
Barrasso, and Udall.
    Senator Boxer. Good afternoon. I believe we have our 
witness; I want to say Senator Salazar, Interior Secretary 
Salazar should be here shortly.
    We are going to have a little bit of a difficult start to 
the hearing because we have a vote scheduled, a couple of 
votes. I am going to tag team with Senator Cardin on this going 
back and forth. But what we want to do is we have all decided 
that we are going to forego any opening statements and each of 
us have 10 minutes to question, because we feel that is the key 
issue. And we just want to get your statements out there, and 
then we have a lot of questions.
    So why don't we start with Hon. Lisa Jackson of the 
Environmental Protection Agency. We will move to Hon. Nancy 
Sutley, Council on Environmental Quality.
    Go ahead.

        STATEMENT OF HON. LISA JACKSON, ADMINISTRATOR, 
              U.S. ENVIRONMENTAL PROTECTION AGENCY

    Ms. Jackson. Thank you.
    Thank you, Chairman Boxer, Ranking Member Inhofe, and 
members of the Committee. Thank you for inviting me to testify 
about EPA's role in responding to the BP Deepwater Horizon rig 
explosion.
    As we all know, efforts by BP to stop the oil release 
continue. While there is no perfect solution to the 
environmental disaster that the Gulf of Mexico is facing right 
now, EPA is committed to protecting our communities, the 
natural environment, and human health. That commitment covers 
both the risk from the spill itself as well as any concerns 
resulting from the response to the spill.
    Let me begin by recognizing the extraordinary effort put in 
by our responders. These are people that have maintained their 
resolve in the face of often overwhelming challenges. They have 
gone above and beyond, and we certainly owe them a debt of 
gratitude.
    In the last 3 weeks EPA has dispatched more than 120 staff 
scientists, engineers, and contractors to Alabama, Florida, 
Louisiana, and Mississippi to perform rigorous testing and 
monitoring of air and water quality. We are tracking any 
possible adverse impacts stemming from controlled burning of 
surface oil, possible chemicals rising from the oil itself, and 
any issues caused by the use of dispersants.
    We are working with State officials, with local university 
scientists, and other Federal agencies to get the best 
available data, share that data in a timely fashion and to 
ensure proper response for the Gulf Coast people and their 
environment. At the President's direction, I have personally 
traveled to the region--the region I grew up in and still 
consider my home--twice over the past weeks to personally 
oversee EPA's efforts and to meet with the local community to 
ensure that their questions and concerns are addressed.
    For weeks, EPA responders have been monitoring air 
pollutants, including particulate matter, hydrogen sulfide, and 
total volatile organic compounds, or VOCs, from the oil in the 
Gulf as well as from the controlled burning of oil. These 
pollutants could pose a health risk to local communities, and 
this monitoring is essential to ensure that communities are 
protected as BP takes direct response actions.
    EPA is also monitoring water quality by conducting surface 
water testing along the Gulf Coast, both in areas that have 
been impacted and those not yet affected. All of this 
information is being made public as quickly as we can compile 
it. We have been posting regular updates to our Web page, 
www.epa.gov/bpspill, which has been a critical resource since 
the beginning of this event.
    A primary concern is to ensure the safe application of 
chemical dispersants. Oil dispersants are chemicals applied to 
the spilled oil to break down the oil into small droplets below 
the surface. Ideally the dispersed oil mixes into the water 
column and is rapidly diluted. Bacteria and other microscopic 
organisms then act to degrade the oil within the droplets.
    However, in the use of dispersants we are faced with 
environmental tradeoffs. We know that surface use of 
dispersants decreases the environmental risk to shorelines and 
organisms at the surface, and we know that dispersants break 
down over weeks, rather than remaining for several years as 
untreated oil might.
    But we are also deeply concerned about the things we don't 
know. The long-term effects on aquatic life are still unknown, 
and we must make sure that the dispersants that are used are as 
non-toxic as possible. We are working with manufacturers, with 
BP, and with others to get less toxic dispersants to the 
response site as quickly as possible.
    EPA has previously authorized use of several dispersant 
chemicals under the National Contingency Plan. In order to be 
placed on this list, each dispersant chemical must undergo a 
toxicity and effectiveness test. However, I am increasingly 
concerned that EPA can and should do more.
    As we emerge from this response, I commit to reviewing the 
regulations regarding dispersant registration and listing. I 
commit to sharing the results of that review with this 
Committee and working to tighten the law if it is necessary in 
order to ensure protection of human health and the environment.
    On Friday, EPA and the on-scene coordinator authorized the 
application of dispersant under water at the source of the 
leak. The goal of this novel approach is to break up and 
degrade the oil before it reaches the water's surface and comes 
closer to our shorelines, our estuaries, and our nurseries for 
fishing. Based on our testing this can be done by using less 
dispersant than is necessary on the surface. But let me be 
clear that EPA reserves the right to halt the usage of sub-
surface dispersant if we conclude that at any time the impact 
to the environment outweighs the benefits of dispersing the 
oil.
    As with our other monitoring initiatives, EPA and the Coast 
Guard have instituted a publicly available monitoring plan for 
sub-surface dispersant application to understand impacts to the 
environment. This data will come to EPA once a day.
    EPA is also preparing to support any necessary shore line 
assessment and clean up. EPA, in coordination with the States, 
will continue to provide information to both workers and the 
public about test results as well as assisting communities with 
potential debris disposal and hazardous waste issues.
    Madam Chairman, as a New Orleans native I know first-hand 
the importance of the natural environment to the economy, the 
health, and the culture of the Gulf Coast. As I mentioned, 
since the accident I have been to the region twice. I have 
listened to people in numerous town halls from Venice, 
Louisiana, to Waveland, Mississippi, and other communities in 
between. I have learned in those meetings that the people of 
the Gulf Coast are eager to be part of this response. They also 
want to be informed, and where possible, empowered to improve 
their situation on their own.
    We have a great deal of rebuilding to do, both in material 
terms and in terms of restoring this community's trust that 
Government can and will protect them in a time of need. This is 
one of those times. I urge that we do everything within our 
power to ensure a strong recovery and future for the Gulf 
Coast.
    EPA will continue to fully support the U.S. Coast Guard and 
play a robust role in monitoring and responding to potential 
public health and environmental concerns. As local communities 
assess the impact on their economies, EPA, in partnership with 
other Federal, State, and local agencies, will provide all 
assets to assist in the recovery.
    At this time, I welcome any questions you may have.
    [The prepared statement of Ms. Jackson follows:]
    
    
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    Senator Boxer. Thank you very much.
    We will go to Hon. Nancy Sutley.
    The Secretary of the Interior has joined us, and we are so 
glad. I know you have been working non-stop, but we are just 
really glad to have you here.
    We will proceed to Hon. Nancy Sutley.

STATEMENT OF HON. NANCY SUTLEY, CHAIR, COUNCIL ON ENVIRONMENTAL 
                            QUALITY

    Ms. Sutley. Thank you, Chairman Boxer, Ranking Member 
Inhofe, and members of the Committee. I appreciate the 
opportunity to testify today and ask that my written testimony 
be included in the record.
    Senator Boxer. Without objection.
    Ms. Sutley. Thank you.
    Before I move to discuss the National Environmental Policy 
Act, I want to express my condolences to the families of the 11 
workers who lost their lives in the explosion and sinking of 
the Deepwater Horizon. I also want to stress that the 
Administration is committed to aggressively responding to the 
environmental crisis in the Gulf and to protecting the lives 
and livelihoods of the people of the region.
    Last week the President sent Congress a legislative 
proposal that would enable the Federal Government to speed 
assistance if the spill gets worse and if the responsible 
parties are not paying claims quickly and fairly. The 
Administration looks forward to working with Congress to 
implement the proposal.
    The President is also forming an independent bipartisan 
commission to look at improvements to offshore drilling 
infrastructure and related measures to better protect workers 
and the environment.
    Today I will focus on NEPA and how it relates to agency 
actions. President Nixon signed the National Environmental 
Policy Act into law in 1970, and in 1978 the Council on 
Environmental Quality issued regulations implementing the 
procedural provisions of NEPA that apply to all Federal 
agencies. Every agency in the Federal Government has an 
affirmative obligation to comply with NEPA.
    Agencies establish their NEPA implementing procedures, 
which tailor the CEQ requirements to a specific agency's 
authorities and decisionmaking processes. CEQ provides 
assistance in this process, and an agency's NEPA procedures are 
not finalized until CEQ determines that they are in conformity 
with NEPA and CEQ regulations.
    In February 2010 the Administration moved to update NEPA 
practices. CEQ released draft guidance that will assist Federal 
agencies to meet the goals of NEPA, enhance public involvement, 
increase transparency, and ease implementation. This draft 
guidance specifically addresses categorical exclusions, or CEs 
which have been used since the 1970s. Agencies can establish 
CEs when experience shows that certain groups of activities are 
unlikely to have significant environmental effects.
    In recent years, the expansion of the number and range of 
activities categorically excluded combined with the extensive 
use of categorical exclusions and limited opportunity for 
public involvement in CE applications have underscored the need 
for additional guidance. In the proposed guidance, CEQ has made 
it clear that it will increase its review of agencies' use of 
CEs.
    When it comes to oil and gas development, the Minerals 
Management Service is required to apply NEPA to drilling 
decisions on the Outer Continental Shelf. Specifically in the 
case of the Gulf of Mexico leases, the Minerals Management 
Service prepared several NEPA analyses. In April 2007 MMS 
prepared a broad programmatic environmental impact statement on 
the Outer Continental Shelf Oil and Gas Leasing Program, which 
includes the 5-year lease plan.
    Also in April 2007, MMS prepared an environmental impact 
statement for the Gulf of Mexico OCS oil and gas sales in the 
western and central planning areas. In October 2007 MMS 
completed another environmental assessment tiered off of the 
multi-sale EIS for the central Gulf of Mexico's lease sale 206. 
This is the sale in which the lease was issued for the location 
that includes the Deepwater Horizon well.
    In addition, MMS approved BP's development operations based 
on a programmatic environmental assessment that MMS prepared in 
2002. In the decision to approve the exploration plan that 
included the Deepwater Horizon well, MMS applied its existing 
categorical exclusion review process.
    The categorical exclusion that was used by MMS for 
Deepwater Horizon was established more than 20 years ago. Under 
the Outer Continental Shelf Lands Act, MMS has 30 days to 
complete its environmental review and act on the exploration 
plan. In the legislation we sent up, the Administration seeks 
to change that timeline to a minimum of 90 days.
    Last week CEQ and the Department of the Interior announced 
a review of MMS's NEPA procedures. This review is to ensure 
that NEPA is being applied in a rigorous way that meets its 
intent, and we expect it to be completed by mid-June.
    In closing, Federal agencies have an affirmative obligation 
to comply with NEPA, and the Administration is committed to 
making sure that agencies meet this obligation. The Deepwater 
Horizon event reminds us of the need for a thorough 
environmental review of offshore oil and gas drilling projects, 
and I am committed to working with the Department of Interior 
to ensure the application of NEPA in a manner that meets the 
goals of the Act.
    Thank you for the opportunity to testify here today, and I 
look forward to your questions.
    [The prepared statement of Ms. Sutley follows:]
    
    
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    Senator Boxer. Thank you very much.
    Secretary Salazar, welcome.

           STATEMENT OF HON. KEN SALAZAR, SECRETARY, 
                U.S. DEPARTMENT OF THE INTERIOR

    Mr. Salazar. Thank you very much, Chairman Boxer and 
Ranking Member Inhofe and distinguished Senators and members of 
this Committee, my former colleagues.
    I thought I would first just give you a quick update on 
what is going on with respect to the efforts to stop the flow 
of oil in the Gulf of Mexico from this horrific tragedy. From 
day one, there has been an effort to move forward with flow 
mitigation, with flow stoppage, and ultimately with sealing the 
well strategies. Let me just take a second and speak about 
those things because I think they are matters of interest to 
the members of this Committee.
    First with respect to flow mitigation, whether it was the 
dome that was tried last week or the current insertion tube 
that is in there, it has been recognized that those are simply 
Band-Aids that will contain some of the oil but probably will 
not contain all of the oil. In fact, it won't contain all of 
the oil.
    The current flow mitigation strategy which is underway is 
the riser insertion tube. You have seen a lot about it on 
television and newspaper reports. As of this morning the 
collection from the riser insertion tube is somewhere between 
1,500 barrels per day to 2,000 barrels per day. It is being 
ramped up every 2 hours, approximately, and the hope is that 
additional oil will be captured through this flow mitigation 
strategy.
    Second, and more effectively, will be the efforts to 
essentially kill the well. There have been three different 
approaches which BP and the group of scientists that have been 
examining the way of killing the well have been looking at over 
the last several weeks. They have now come to a conclusion that 
the best way forward, given the diagnostics that have been 
done, is to move forward with the dynamic kill of the well. The 
so-called dynamic kill of the well is essentially killing the 
well through the insertion of mud. That procedure, according to 
the latest schedule, is for this Sunday.
    So hopefully those efforts will contain the oil. They will 
stop the flow of oil and then move forward to what will be the 
ultimate demise of this well, and that is through the 
construction of the relief wells. There are two relief wells 
that are being drilled. Just in case something goes wrong with 
the first one, there is redundancy in all these procedures. So 
the second relief well, then, that has to be drilled would be 
used to seal the well.
    That is the permanent solution. That solution is probably 
something that will not happen until August. And so hence the 
importance of both the flow mitigation and the full stoppage 
efforts that are underway.
    Second, let me just make a comment about the comprehensive 
response that the President ordered from the beginning on this 
effort. It has been a comprehensive command and control effort 
on the part of the U.S. Government. In that effort, EPA 
Administrator Lisa Jackson, Nancy Sutley and many others have 
been involved, Secretary of Homeland Security Janet Napolitano 
and our National Incident Commander Thad Allen and many others.
    It is a directive that the President has given to all of us 
that we shall not rest until we have this matter resolved. And 
I can guarantee you that none of us are resting. It has been 
relentless 18-hour days, 7 days a week, and we will continue 
this effort until we get the problem resolved.
    An illustration of the muscle that is going into this 
effort today, and in terms of the effectiveness of the response 
plan that had been put into place that is being actuated can be 
told in a simple set of numbers: 20,000 people, an army that 
essentially is combating the oil spill on the Gulf Coast today; 
over 750 vessels that are out there, ships from some of the 
most sophisticated ships in the world, the skimming ships, the 
other vessels that have been commissioned to move forward with 
this effort.
    In a word, nothing really is being spared to move forward 
and to resolve this issue, and that is the directive that we 
have from the President.
    The third point I want to make, there have been other 
hearings that have been held here in the Congress. There will 
be many more hearings in the future. The President has been 
clear. There is responsibility to go around with respect to 
this major environmental disaster that has happened. That 
collective responsibility should lead us to do two things. 
First, fix the problem that we find ourselves in in the Gulf of 
Mexico today. And second of all, make sure that this never 
happens again. That should be our collective responsibility.
    Instead of doing the finger pointing that sometimes happens 
when you get into these kinds of incidents, my own view is that 
it is a matter of collective responsibility. It is a 
responsibility which we assume at the Department of Interior 
and its Minerals Management Services for a job that we believe 
can in fact be done better.
    We have been working hard on a reform agenda which many of 
you are aware of for renewable energy, to new safety measures, 
to additional inspectors, and a whole host of other things. But 
that reform agenda is not yet complete. There is a lot more to 
go, and obviously this incident solidifies the conclusion that 
the reformation that needed to happen at MMS will in fact 
happen.
    Second, it is not just about the executive branch. It is 
also about the U.S. Congress. I had the honor of being a Member 
of this distinguished body and friends with the members of this 
Committee. The national framework which we are operating on, 
which is part of the National Energy Program with respect to 
development of oil and gas on the Outer Continental Shelf is 
one that has been forthcoming over the last 40 years.
    There are parts of the congressional requirements and the 
congressional effort here which you have to assume 
responsibility for. A couple of quick examples. First, the 
President's package which he sent to Congress a few days ago 
would require MMS to have more than just the 30 days, which now 
is required to act on expiration plans, is a good step forward. 
There are many other measures I am certain that this body will 
be considering to make oil and gas production more safe.
    Among some of those that I would urge this Committee, 
working along with Senator Bingaman's and Senator Murkowski's 
Committee on Energy, is to move forward with the enactment of 
comprehensive organic legislation for the Minerals Management 
Service. It is to me, frankly, a troublesome reality that we 
find ourselves in in 2010, where you have an agency with the 
responsibilities of the Minerals Management Service without an 
organic act of this Congress. It exists by virtue of 
secretarial order that was signed now some 30 years ago. An 
agency that has the responsibility of getting $13 billion on 
average a year for the American taxpayer-owned property that 
helps fund the operations of this Government needs to have a 
higher stature.
    An agency with 1,700 people that has the responsibility for 
protecting our oceans and for developing energy resources, both 
conventional and renewable energy resources, needs to have a 
higher stature, and so the organic legislation that I am 
hopeful this Congress considers is something that we are 
looking forward to.
    Third, as we speak about collective responsibility it is 
important to note that from day one BP, under the laws of the 
United States and our initiatives within the U.S. Government, 
is the responsible party. That is what the law says. That is 
what the lease requires. They are responsible for stopping the 
leak. They are responsible for containing the oil on the ocean. 
They are responsible for protecting our beaches and our coastal 
areas and our ecological resources. And they are responsible as 
well for paying whatever damages occur from this incident to 
the environment of the Gulf Coast. And in addition to that, 
responsible for compensating those who will be harmed from this 
incident.
    They have confirmed that that is their responsibility. They 
will not hide behind the Oil Act pollution liability 
limitations, but will assume that responsibility, and they have 
confirmed that in a letter to Secretary Napolitano and me which 
we received just a few days ago.
    Beyond BP and the collective responsibility here, there are 
other companies that certainly will be part of the 
investigations and which will be held accountable for whatever 
action those facts show us they should be held accountable for, 
but they will include Cameron, the manufacturer of the blowout 
prevention valve; Halliburton, the cementing company; 
Transocean, the owner of the rig; and many others that will be 
involved.
    Fourth, what I would say, when we think about collective 
responsibility, I look at each of the members of this Committee 
with whom I have worked, and we have talked about national 
security for the United States of America. We have talked about 
energy security for the United States of America. I know 
Senator Voinovich has said it is one of his huge legacy issues.
    There is a statement here to be made from this awful 
tragedy in the Gulf Coast, and that is we need to move forward 
with a new energy frontier. Yes, oil and gas will be a part of 
our future. The President has said from day one that a 
comprehensive energy plan is something that we need, but we 
need to bring other streams of energy into the security part of 
our country.
    And if I may, Madam Chairman, just a couple of other quick 
points. With respect to Interior reform of the Minerals 
Management Services, we have done a cleaning house of this 
agency from day one. There have been people who have been let 
go. There have been people who have been referred for 
prosecution. And we will continue on that vein as we move 
forward with these investigations.
    We have eliminated the Royalty-in-Kind Program because we 
felt that that was an area in the agency that was subject to 
fraud and abuse. We have beefed up enforcement, including in 
the budgets that this Congress has approved. And we are 
separating the functions of MMS between those relating to 
revenue and those related to safety and enforcement, and there 
will be some additional announcements of that that will be made 
later on.
    And the final point, just to bring the members of the 
Committee up to speed in a comprehensive way relative to 
investigations that are underway, the President's commission 
will be the kind of commission that we saw during Challenger 
and Three Mile Island. And through that kind of commission, you 
will also see other investigations that will inform the work of 
that commission.
    I want to make two quick points, if I may, and I know I am 
running a little beyond my time.
    Senator Boxer. The problem is we have a vote starting 
momentarily.
    Mr. Salazar. Let me then just be very quick. With the Three 
Mile Island Commission, you will recall there were two reactors 
on which shut down for 6 months, and you know what the rest of 
that legacy was. With respect to the Challenger Commission, 
there was a 2 and a half year delay with respect to the Space 
Shuttle Program.
    We have three investigations that are already underway with 
Coast Guard and MMS trying to get to the root cause of the 
accident. We have a National Academy of Engineering 
investigation which we have initiated. And we have an 
investigation which I have directed from the Inspector General 
as well. Those investigations will all lead to the Presidential 
Commission, which will then get us the findings and the lessons 
learned so that we know the truth.
    Thank you, Madam Chairman.
    [The prepared statement of Mr. Salazar follows:]
    
    
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    Senator Boxer. Thank you very much.
    So each of us is going to have 10 minutes to use as we 
wish, either a statement, or a statement and questions, or just 
questions.
    As many of you know, some of us have been seeking releases 
of the video of this spill. And at our hearing last week, we 
asked BP. Essentially, BP said, oh, we have sent this all to 
the Incident Command over at the Coast Guard. The Coast Guard 
informed us that wasn't the fact, and the Coast Guard was very 
much in favor of getting all of the hard drives and getting all 
this material. They were just getting streaming video.
    So this morning, we got a breakthrough. BP agreed to 
release all the video of the spill. And I want to show a video 
clip of one of these interim technologies that was discussed 
here today, the insertion tube. And before you put it on, I 
think the thing to look for here is that this insertion tube 
may be capturing some oil, but it is not capturing most. And 
you will be shocked. As a matter of fact, I was nervous about 
showing it because I said, are you sure? And my chief of staff 
said, yes, we have this from BP showing the RITT, which is the 
riser insertion tubing and the dispersement tools in operation. 
So if you can show that.
    [Video]
    Senator Boxer. See it? Look. There is the oil after the 
insertion tube. And at the bottom it looks like a little flame. 
That is the dispersant at work down there.
    So I just felt it was important for us to note that this 
interim step, if you look at the other picture of before they 
put it in, you can't really tell the difference that much. So 
it is an interim step. It is not doing what a lot of us were 
hoping that it would do.
    And we are getting all these records tomorrow, Mr. 
Secretary, and we will get them to everybody because it is so 
important to us on this Committee on both sides. We want to 
make sure that scientists who are quite objective and have 
nothing else on their agenda can take a look at this and let us 
know what are the true volumes. And as we move forward to other 
fixes we want to see whether they are really doing the job.
    Secretary Salazar, yesterday I sent a letter to the 
Attorney General with several other Senators from this 
Committee asking that he investigate whether BP has violated 
any criminal or civil laws in its actions related to the 
Deepwater Horizon oil spill. And I want to show all three of 
you some of the statements that they made.
    This is what was on their initial permit request: ``In the 
event of an unanticipated blowout resulting in an oil spill, it 
is unlikely to have an impact based on the industry-wide 
standards for using proven equipment and technology for such 
responses.'' And they also said, ``Due to the distance to 
shore, 48 miles, and the response capabilities that would be 
implemented, no significant adverse impacts are expected.''
    And then after the spill occurred, this is what they said, 
after they assured us that they had all the equipment 
necessary: ``All the techniques being attempted or evaluated to 
contain the flow of oil on the sea bed involve significant 
uncertainties because they have not been tested in these 
conditions before.'' This is stunning. This is the before and 
after statements that it is as if they were written in 
different worlds and different realities.
    And so I wanted to ask you. You have announced that you are 
going to have an investigation, which I hope I speak for 
everybody, I think it is totally appropriate. I am very 
supportive of it. But I feel that the Justice Department ought 
to take a look to see whether false statements were made.
    Do you support the Justice Department taking a look at 
this? I would start with Lisa Jackson.
    Ms. Jackson. I would certainly defer to the Attorney 
General, who is a lawyer, and I am certainly not one, as to 
whether they meet the standards for criminality in the case. 
Certainly, investigations are warranted.
    Mr. Salazar. Let me respond to that, if I may, Chairman 
Boxer. The fact of the matter is that the investigations that 
are underway, including the Presidential Commission, when the 
facts are known, the truth shall be known as well, and whatever 
actions have to be taken will be taken. Whatever the level of 
culpability is with respect to civil liability, or wherever the 
facts take us, that is the action that the Federal Government 
will take. We will hold those accountable under the law.
    At this point in time, Chairman Boxer and members of the 
Committee, there are many facts which are still unknown. And it 
will be time before we are able to get to the bottom of all of 
this, but I can assure you that from the President's point of 
view and my point of view having been involved in helping 
direct this effort, one, transparency is important, which 
relates to your video and getting whatever information 
available to you.
    And second of all, accountability. So accountability will 
be there in whatever shape it will take.
    Senator Boxer. OK.
    Ms. Sutley.
    Ms. Sutley. I would just agree with the comments of my 
colleagues that it is important that we go where the facts take 
us and look into both the causes and the implications of the 
actions that were taken and take appropriate action.
    Senator Boxer. OK. I just want to reiterate, I am going to 
push hard on a DOJ investigation because I know what was said. 
What was said is we can handle this. And what was said after it 
was essentially we can't handle this. And if you believe that 
people are supposed to tell the truth on a permit in a 
situation like this where so much is at stake, so I am going to 
push separately for a DOJ investigation.
    And I think, Administrator Jackson, you are right. We will 
see. Because the other investigation is a little bit different 
than this. This is about what people are saying on their permit 
applications and what they really have in their backpack, so to 
speak, to deal with this once it happens.
    And so I am very glad that the President is doing this 
commission. I don't want to understate how pleased I am at 
that. I am also very pleased that, Mr. Secretary, you have 
cleaned house over there. I assume there is more to be done, 
but I am also very pleased that you talked about a separate 
agency to look at safety as opposed to an agency that is 
pushing the drilling.
    I am a little concerned--and I know I was talking to 
Senator Voinovich about this. He was using some examples. I 
don't want to take his point of view and try to express it. He 
will do that on his own.
    But are you concerned that if we just have an agency within 
MMS, rather than outside MMS, that you are going to really 
crack this culture of the good old boys, and girls, I assume, I 
don't know if there are any girls over there, just taking each 
other out to dinner and this cozy relationship, if you have it 
within the MMS?
    Mr. Salazar. I am confident that we will be able to address 
the problem, Chairwoman. The first thing that we did when we 
came in was to deal with a new code of ethics that we have 
installed in MMS. We have done away with programs like the 
Royalty-in-Kind Program and other measures.
    We have just begun our efforts. There is a lot more to be 
done, and we will get it done to make sure that the Government 
operates in a manner that we can all be proud of and that is 
doing its job.
    Senator Boxer. Well, I am going to ask one more time. Will 
you consider a separate entity outside of MMS, as opposed to a 
safety agency located within MMS? It gives me a little bit of 
concern. You have the safety people around the corner from the 
other folks, and again, I don't know whether we are playing 
into this all too cozy relationship.
    Mr. Salazar. Madam Chairwoman Boxer, we have done a lot to 
reorganize this agency. We will be announcing some more 
reorganization efforts in the days ahead with respect to MMS. 
Many of the issues that you raise will be taken into account in 
that reorganization. But in addition to that, as I said 
earlier, the responsibility is a broadly shared one, and I 
think it is important for this Congress to also put together 
organic legislation for this agency that conducts such an 
important set of functions for the United States.
    Senator Boxer. Yes, well, I look forward to sharing that. 
From my perspective, I think it is important. This is an 
ongoing nightmare, and if ever we are going to reform, it is 
now because it is fresh in people's minds. And I would feel so 
much more confident, as I do with other issues in the Federal 
Government when we have a true independent check and balance. 
And so I look forward to working with you on that.
    With that, I will call on Senator Inhofe, and I think you 
will have time to go through your statement.
    Senator Inhofe. And then we will vote. The vote has 
started, and then we will come back.
    Senator Boxer. Yes, for the benefit of the panel, a vote 
has started.

          OPENING STATEMENT OF HON. JAMES M. INHOFE, 
            U.S. SENATOR FROM THE STATE OF OKLAHOMA

    Senator Inhofe. Let me first of all say what I said on the 
floor yesterday. I was very complimentary of President Obama, 
as well as you, Administrator Jackson, in the way you have 
handled this. I was very proud of the President when he said, 
``The most important order of business is to stop the leak and 
we need to stop it as soon as possible.'' He went on to say, 
``We must contain this spill and protect the Gulf Coast and the 
people who live there.'' And he went on to say, ``mitigate the 
damage caused by the spill.''
    We all agree with that. And what I was going to say in an 
opening statement, but I will paraphrase it now, I think we 
should be very careful not to allow people to take this to 
advance a personal agenda. I happened to be around 20 years ago 
when the Exxon Valdez happened. In fact, I was in the House and 
serving on the Transportation Committee. And several people at 
that time made the public statement, actually these are some of 
the extremist environmentalists who said we are going to parlay 
this into stopping all drilling on the North Slope.
    My response was this is mostly a transportation accident, 
and if you stop it, that would make us more dependent upon 
foreign oil. Therefore, transportation would increase and the 
likelihood would increase of something else like this.
    And I am seeing some of the same things happening today, 
and I just hope that we could all guard against this and keep 
in mind that we have something to do. That is clean this mess 
up and do all we can to make sure it doesn't happen again.
    [The prepared statement of Senator Inhofe follows:]

                  Statement of Hon. James M. Inhofe, 
                U.S. Senator from the State of Oklahoma

    It might come as a surprise to some people in this room, 
but I want to commend President Obama for his speech on the oil 
spill last Friday. He didn't waste time pointing fingers, 
assigning blame, or issuing irresponsible statements against 
domestic energy production. He said what I've said from the 
very start. Let me quote him. The ``most important order of 
business,'' he said, ``is to stop the leak . . . and we need to 
stop it as soon as possible.''
    The President went on to say that we must ``contain the 
spill and protect the Gulf Coast and the people who live 
there.'' Again, that's exactly what we should be doing. He also 
mentioned the need to ``mitigate the damage caused by the 
spill'' and to put in place ``every necessary safeguard and 
protection so that a tragedy like this oil spill does not 
happen again.''
    This is very similar to what I said at our last hearing on 
the spill. I said that we need to:
     Mitigate and contain the environmental impacts;
     Provide assistance to the Gulf's commercial and 
recreational fishing industries; and
     Investigate the causes so we can prevent a disaster of 
this kind from happening again.
    Administrator Jackson, I have great respect for you--and I 
was pleased with what you said recently about the spill. You 
said we need a thoughtful response to ensure this doesn't 
happen again. You said the focus must be on stopping the oil 
spill and helping the people affected. I couldn't agree more.
    I also appreciate your hard work, along with the Coast 
Guard and NOAA, in approving the testing on the subsea use of 
dispersants. The early results are encouraging. I also support 
your diligence in monitoring to ensure that the use of 
dispersants is effective and environmentally sound.
    Based on what I've seen thus far, we have agreement on what 
needs to get done, and I hope we can agree on the path forward. 
Unfortunately, I'm afraid that this spill has occasioned some 
fatally misguided legislation, which will make us more 
dependent on foreign oil.
    This Committee exercises primary jurisdiction over the Oil 
Pollution Act (OPA) of 1990. Senator Menendez's bill, S. 3305, 
would amend the OPA. He may not know it, but his bill is a big 
help for big oil companies, such as BP, and for foreign and 
state-owned oil companies.
    S. 3305 would make offshore production for small- and 
medium-sized independent producers economically infeasible--
they would be forced out of the Gulf. We can't forget that the 
independents produce 63 percent of the Gulf's natural gas and 
36 percent of its oil. If S. 3305 became law, their business 
would be swallowed up by the likes of BP and the China National 
Offshore Oil Corporation. How would that help address the 
spill? How would that lessen our dependence on foreign oil?
    We experienced something like this in 1989 with the Exxon 
Valdez oil spill. Remember that that incident was different 
from what are dealing with now. Exxon Valdez was the name of 
the tanker that crashed in Prince William Sound. It was a 
transportation accident.
    I was on the House Transportation Committee at the time. 
Much to my dismay, environmental groups politicized the 
accident; they exploited it to achieve their goal of shutting 
down domestic oil production. Of course, the irony is that we 
are more dependent on foreign oil. Companies moved their 
operations overseas. What's more, we now have more tankers 
coming to port, which increases our risk of oil spills.
    Yesterday, President Obama announced plans to establish an 
independent commission to comprehensively investigate the 
causes of this spill. Madam Chairman, let's address the urgent 
needs of the moment. And then, after that, when we have all the 
facts, we can draft the appropriate response, one that will 
protect the environment and lessen our dependence on foreign 
oil. We can do both, and I hope we will do both.

    Senator Inhofe. Administrator Jackson, first of all, thank 
you for your availability. I did bother you a few times, and 
each time I called you down there, you were in a different 
State on the coast meeting with different people. So I know you 
are on the job.
    I was going to ask you something about dispersants, but I 
think you covered it pretty well in your opening statement, 
except for one thing, and that is in terms of the toxicity of 
the dispersants as compared to the toxicity of the oil itself. 
Do you have any comments you could make about that?
    Ms. Jackson. Certainly, Senator. In general the toxicity of 
the dispersants is far less than the toxicity of the crude oil 
itself. And in general they are shorter-lived in the 
environment than oil alone.
    Senator Inhofe. So it would actually be less, but also more 
temporary. This is not what some of the things that have come 
out through the media, and I appreciate that.
    Ms. Jackson. I think the only unknown here is that there 
are very large unprecedented volumes of dispersants being used 
both at the surface, and of course now this sub-sea injection 
is a totally new technology.
    Senator Inhofe. Right, right. The other thing I was going 
to ask you about, more to my benefit than anyone else's, we 
have been hearing a lot of talk about a large orange plume 
under the ocean surface approaching the loop current. The EPA 
and NOAA have confirmed whether this plume is related to the 
oil spill. What more can you tell us about the big orange plume 
that we have been hearing about?
    Ms. Jackson. Senator, I would certainly defer to NOAA, 
whose job is to predict where this dispersed oil will move. The 
concern I had was on Sunday when we had an article in the New 
York Times that said that there was a dispersed plume of oil, 
and there was at least the implication that dispersants were to 
blame for it, and in fact sub-sea dispersants.
    And on Sunday afternoon at 4 o'clock Jane Lubchenco and I 
got on the phone with the scientists on the Pelican research 
ship, and they don't yet have the data to show whether all or 
most of what they are seeing as anomalies are indeed oil. 
Certainly, some of them are likely to be, but they are waiting 
for that data.
    There was a lot of talk about dissolved oxygen, and in fact 
their dissolved oxygen numbers are not uncharacteristic of what 
you would expect to find. They said to me when I asked them 
that they hadn't seen any dissolved oxygen levels that were of 
concern.
    And they also said quite clearly when I asked them that 
they had no data to show that this was due to dispersant use. 
It could be natural dispersion of oil. Oil is going to disperse 
in the atmosphere. So there is so much we don't know at this 
point.
    Senator Inhofe. OK.
    And Secretary Salazar, in what was going to be my opening 
statement, yesterday we talked about the Menendez bill on the 
floor of the Senate. I actually took the position of President 
Obama in that for us to right now raise these limits as they 
are trying to do in Senate bill 3305, I felt at that time that 
that is premature, as the President stated also. That if we do 
that, there are other unintended consequences, and we don't 
know. Later on we may have a better idea as to what level of 
liability should be set in terms of the change.
    Now, one of the things that is of interest to me 
colloquially, and I will read a paragraph out of this letter. 
This letter is from the Executive Vice President of the Alliant 
Insurance Group. We have a similar one from Lloyds of London. 
They said, ``If the liability cap is increased to levels we 
understand are under consideration, in our view only major oil 
companies and NOCs,'' that is the national oil companies, 
``will be financially strong enough to continue current 
exploration and development efforts.''
    Our analysis of this is it would be the five majors, plus 
perhaps NOCs of Venezuela, China. I guess the question I would 
ask of you, do you think that is good? Do you think that is 
healthy? And have you given it thought to limits of liability 
at this time? Or do you think it is premature?
    Mr. Salazar. The President has sent a request to the 
Congress to lift the amounts on the liability limitation. What 
that exact amount should be should take into consideration the 
kinds of facts that you are alluding to here, Senator Inhofe.
    And so that is why the Administration will engage with the 
Congress and will figure out where the appropriate limit should 
be set. That is why there was not a specific number that was 
sent forth.
    Second, if I may, there has been a lot of questions about 
the BP responsibility here and the liability limitation. In our 
view, and BP has confirmed this in writing, that liability 
limitation does not apply to this incident because BP has 
affirmatively stated and has memorialized in writing that they 
will pay for all damages resulting from this incident.
    Senator Inhofe. Last night, I saw the rerun, in fact I saw 
it three times, of Mike Williams on 60 Minutes. I am sure all 
of you saw that. He had some pretty shocking things to say and 
conclusions in terms of who was at fault, why it was, and all 
that.
    I would like to ask all three of you if you have any 
thoughts about the testimony of Mike Williams as it was 
portrayed on 60 Minutes, starting with you, Mr. Secretary.
    Mr. Salazar. I did not watch it because I have been working 
on the Gulf incident non-stop, so I did not watch it.
    Senator Inhofe. This is the Gulf incident we are talking 
about.
    Mr. Salazar. But I did not watch the 60 Minutes program. 
But I will say this, the reality of it is, Senator Inhofe, that 
there are many facts that will see the light of day as these 
investigations move forward. Anyone who has the responsibility 
for not having done what they said they were going to do, 
whether that is the private companies that were involved, 
including BP and others, or whether it was people in the public 
sector, they will be held accountable.
    Senator Inhofe. OK.
    For the other two, just for the record, if you would give 
your response, I would appreciate it very much.
    I am going to go vote.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
            U.S. SENATOR FROM THE STATE OF MARYLAND

    Senator Cardin [presiding]. As has been pointed out, there 
is a vote currently on the Senate floor. There is another vote 
following, so I voted early in order to keep the hearing going.
    So with that in mind, I don't take it personally that I 
don't have too many of my colleagues to hear my questioning.
    Mr. Salazar. It is the first time I have seen you in your 
position as Chairman, Chairman Cardin.
    Senator Cardin. Right. I appreciate that, former Senator 
Salazar.
    Mr. Salazar. But you are alone.
    Senator Cardin. Let me thank all three of you, though, for 
your service, and thank you for being here. I know that these 
are extremely difficult days, and the inadequacy of the 
regulatory process for approving drilling sites pre-dates the 
Obama administration. So I fully understand that, but you have 
the responsibility to set into motion the type of changes that 
will correct this failed system.
    And I say that because we had a hearing, and we went over 
it with the BP oil executive and the others that were related 
to what happened at Deepwater Horizon. And the Department of 
Interior needs adequate information in order to judge the 
applications that are being filed.
    And when you look at BP's exploration plan that was filed 
for the Deepwater Horizon, it said that--and this was the 
basis, as I understand it, for the Department granting an 
environmental exception--BP said the ``unlikely event of an oil 
spill as having little risk of contact or impact to the 
coastline or associated environmental resources.''
    Little chance, virtually no impact on the coastline, and 
they noted proven response technologies, citing the blowout 
preventer, which they claim was basically fail safe for this 
particular episode, when in reality the Minerals Management 
Services shows that the blowout preventers had failed or 
otherwise played a role in at least 14 accidents.
    So I guess my first point is, the application that was 
filed that was the basis for the environmental exception was 
hard to understand how the regulators would have accepted that 
because it is so far from reality.
    Second, when you take a look as to what is going on now, it 
has me concerned that the Department of Interior might be 
granting further environmental waivers based upon the same 
process that gave us the failed results in the Deepwater 
Horizon.
    So I hope that the review process is different today. The 
Department of Interior needs adequate staff to do an 
independent review. And Mr. Secretary, we welcome your thoughts 
as to whether you have adequate resources, and we certainly 
want you to rely upon other Federal agencies that are more 
expert on the environmental impact in making your 
recommendations as to whether permits are granted in the 
future. There have been reports that drilling permits without 
NOAA were granted without the NOAA impact or ecological impact.
    So I think this Committee is going to be interested in 
finding out what changes are being placed in practice now to 
make sure we don't have another disaster and that the 
regulatory process has learned from this experience and has put 
in place a process that will protect us in the future.
    No. 2, the Government has a responsibility to make sure 
that we have an independent assessment of the damages caused by 
the leak. I say that because BP originally said there was 1,000 
gallons. Then they changed it to 5,000 gallons. Now you are 
saying we are capturing 1,500 to 2,000 gallons. So is that 40 
percent, or do we know how much of the leak is actually coming 
out? I know that there has been a great deal of press accounts 
as to the methodology used by BP Oil in assessing the amount of 
leak. There have been those who have said that the process that 
was used is not really the right process to use for a leak of 
this magnitude.
    And they said that if this estimate was given, it should be 
a range, not a single point estimate, and they just came up 
with 5,000. And as you know, we need to know an accurate 
account if we are going to be able to assess the impact to the 
environment and what we should do to mitigate the impact if we 
don't have an accurate assessment.
    And quite frankly, BP lacks credibility on this. I know 
that Woods Hole experts have been willing to go to the site and 
do a more scientific estimate that would not detract at all 
from BP Oil's efforts to stop the leak, which is certainly 
their first priority, and we don't want them to be distracted. 
But we have independent scientists who are prepared to give us 
that information. It seems to me that we as a Government have 
the responsibility to know.
    I also appreciate Secretary Jackson's point as to the 
dispersant agents. I agree with you. That is the lesser evil 
right now, at least that is what we believe it is, but it is 
still causing damage, including the release of so much 
dispersants, and No. 2, the oil still stays there. It just 
doesn't come to the surface and it does cause dead zones in the 
ocean. So we still have problems. And we have a responsibility 
to fully understand that as part of the process.
    So I want to get to one specific question to Secretary 
Salazar, and it deals with the current expansion of sites. When 
the President announced that he was going to protect the north 
Atlantic, the Pacific, and parts of Alaska because of their 
environmental sensitivity, as you know, I took exception to 
that. And I took exception to that mainly because of the area 
that I represent, the mid-Atlantic.
    I quite frankly didn't understand this. The 2006 MMS 
assessment as to the amount of oil and gas in the mid-Atlantic 
was between 26 days and 52 days for our Nation's use in oil; 1 
to 4 months in natural gas. In the Lease Sale 220, the Virginia 
site, which is under active consideration, it is 1 week of oil 
for our Nation and that is located 60 miles from Assateague 
Island, and 50 miles from the mouth of the Chesapeake Bay.
    So I guess my first question to you, Mr. Secretary, is I 
hope that you are reconsidering because I listen to you. And I 
was very much motivated by your, and I think this is an exact 
quote, saying that there are ``protecting places that are too 
special to drill.'' And you said the Pacific. You said the 
north Atlantic.
    Well, I am going to invite you to the Chesapeake Bay, 
because I can tell you the way that currents run off the mid-
Atlantic, the way the wind blows, any oil spill will affect the 
Chesapeake Bay, which from President Reagan to President Obama 
has been declared to be a national treasure. The Ramsar 
Convention has said it is a body of water of international 
significance.
    So I would hope that you are reconsidering the 
classification of the areas that you have opened for new 
exploration, where there is not currently drilling, and I 
certainly urge you to do that.
    Mr. Salazar. If I may, Chairman Cardin, respond to a few of 
your questions.
    First, with respect to the NEPA analysis in your opening 
statement, I think Director Sutley went through the very 
extensive NEPA analysis that has been performed with respect to 
the Gulf and with respect to this particular lease sale. It has 
been expansive.
    Second, you asked the question about limitations. There are 
limitations, including the 30-day requirement which says by 
law, by this Congress, signed off as a national framework of 
these United States, that MMS must approve an exploration plan 
within 30 days from the day it is submitted. And so that is one 
of those opportunities of responsibility that we hope that the 
Congress helps us with in terms of changing the law with 
respect to that 30-day requirement.
    Three, additional resources to enhance inspections at 
Minerals Management Service. We welcome those. We have 
requested those in our budgets for 2010, 2011. The President's 
submission to the Congress in the last week has also requested 
additional resources for those inspection measures to take 
place.
    Fourth, relative to safety issues on the well prevention 
mechanisms and moving forward with that, there will be a set of 
comprehensive recommendations will be delivered to the 
President at his direction by the end of this month. I think 
you will find those very informative.
    Fifth, with respect to the amount of oil, it is very 
difficult in this environment to actually grasp how much oil is 
being leaked. It has been a very difficult process, but we are 
not relying on what BP is telling us. We have our own 
independent responsibility to go and do that. And so even as we 
speak today, NOAA, along with the United States Geological 
Survey, along with Admiral Allen who is working on this issue, 
are coming up with an oil budget to basically be able to 
determine how much oil has been spilled, how much has been 
cleaned up, and that information will be important to this 
Committee. It will be important to the executive branch as we 
deal with issues such as natural resources damages.
    Senator Cardin. When will that information be made 
available, do you know?
    Mr. Salazar. Yes, they are working on it very hard. I can 
just tell you right now that there are planes flying over the 
oil slick doing the kind of analysis that will allow the 
quantification of the oil not only on the surface, but also 
that that may be below the surface. So these efforts are 
extensive, and they will be correct, and the conclusions will 
be correct.
    The final point you raised has to do with the Atlantic and 
Virginia Lease Sale 220. Let me just say, we went through a 
very extensive process. You might remember when I came on board 
as Secretary of Interior that there had been a proposal to open 
up all of the Atlantic, most of the Pacific, all of Alaska, 
everything else within the Gulf Coast.
    What we did is I called a time out under very significant 
criticism from the oil and gas industry and others about what 
we were doing. That was because we wanted to make sure that 
when we finished the process that we would have gone through a 
thoughtful analysis that came up with the best way forward.
    Specifically with respect to the Atlantic, the information 
on what is out in the Atlantic is very old, more than 30 years 
old. So this Congress may have been waging a war about Atlantic 
resources without knowing at all what it is that we are waging 
a war about. And so the seismic efforts that are underway in 
the Atlantic are something that we are looking at with respect 
to moving forward into the future. The Virginia resale plan 
itself, though, Senator Cardin, it is still more process 
underway with respect to that Virginia lease sale, including 
dealing with issues that we know from the Department of 
Defense.
    So there will be more that will be coming from that, but I 
will assure you of this, that the President has made it very 
clear, and I have made it very clear as well, that we will not 
move forward unless we can be absolutely safe with respect to 
the future of OCS oil and gas production.
    Senator Cardin. Well, I appreciate that statement, and I am 
going to come back to it in a moment. But you still haven't 
quite answered to me, and I am against drilling off the 
Pacific. And I am against the North Atlantic drilling. So let 
me make it clear, I have enjoyed both of those coastlines and 
know how precious they are. Don't get me wrong.
    But I am still puzzled as to why you believe they are 
environmentally so sensitive that no drilling can take place, 
whereas the Chesapeake Bay, which is truly a unique treasure 
not only of our Nation, but an international treasure that 
happens to be located in the mid-Atlantic, how you could 
recommend using the too sensitive to drill standard, how you 
could recommend that we even look at the mid-Atlantic?
    Mr. Salazar. Let me answer the question. First, let me say 
that on the Chesapeake Bay, we all agree with you that it is a 
crown jewel of our Nation and Administrator Jackson, Nancy 
Sutley and myself, Secretary Vilsack, have been moving forward 
with hopefully what will be a new beginning for the Chesapeake 
Bay, but they can speak more about that.
    Senator Cardin. I am very much in support of that.
    Mr. Salazar. But let me answer your question specifically 
to the Virginia lease sale. One of the legal factors that I 
must consider as Secretary of Interior is what the positions of 
the States are vis-a-vis drilling in the Outer Continental 
Shelf. You know well, Senator Cardin, as I do, that the 
Governor of Virginia and the law of the State of Virginia 
contemplate that there will be oil and gas drilling 50 miles 
off the shore of Virginia. The two Senators of that State who 
sit with you in this body have that same position. That is a 
factor for us to consider as we move forward, and that is why 
that lease sale was included in that announcement.
    Senator Cardin. I would just point out, though, as Senator 
Kerry and Senator Lieberman and Senator Graham have looked at 
this issue, they understand the impact on surrounding States. A 
spill in lease sale site 220, if we had a spill there, is very 
likely it would affect the Maryland coastline. So it is not 
fair to say this is a Virginia decision. It affects Maryland. 
And I think that we are going to revisit this, and I can assure 
you that this issue is going to continue to be raised. And I am 
all for an energy policy that makes sense, but I am not for 
going in an area that has such little potential with such high 
risk. And I just for the life of me cannot understand.
    You didn't say that California didn't want drilling, and 
that is why you didn't use California. You said there are some 
areas that are too sensitive to drill. That is your language, 
not my language. And I find it somewhat offensive to the 
Chesapeake Bay and the State I represent for us to be 
considered less worthy for protection than the West Coast of 
the United States or the north Atlantic.
    Now, let me just see if I understand your position on the 
moratorium on new site areas. Are you committed to suspending 
any new offshore oil or gas development until structural, 
procedural and quality problems with the environmental review 
and permitting process for offshore oil and gas activities have 
been fixed and agency employees have been properly trained on 
the new procedures?
    Mr. Salazar. First, Senator Cardin, the President has been 
very clear. He has directed us to develop a report to him on 
safety measures. Those will be done by the end of the month. 
And that will inform our decisions about how we will move 
forward.
    Second of all, with respect to the moratorium, it is widely 
misunderstood, but it was the Congress and the prior 
Administration that lifted the moratorium in the face of 
foreign $5 gas prices just a few years ago. And so the only 
place that is currently under moratorium legally in the United 
States is the area in the eastern Gulf off of Florida.
    Senator Cardin. I understand the legal, but it was my 
understanding that the President has ordered that there will be 
no new exploration sites until the review has been done as a 
result of this current spill. Am I wrong in that?
    Mr. Salazar. The President's order, they just put it in the 
most simple of terms, is we have hit the pause button as is the 
correct and appropriate thing to do. Until we get those reports 
up to the President at the end of the month, we will not be 
making further decisions.
    Senator Cardin. All right. So my question is, how do you 
start or move off the pause button? The release of a report 
could bring out structural problems in the review process. Are 
you telling us now that all it takes is this report to be 
issued, and then all of a sudden we are going to be getting new 
sites that are going to be permitted for drilling, even though 
we don't have an adequate system in place?
    Mr. Salazar. Senator Cardin, I would just have to tell you 
that the report that will be delivered to the President will be 
one that I am proud of, one that I will stand behind. The 
President and I will take into consideration the information 
that is set forth in that report. So my suggestion to you is 
stay tuned.
    Senator Cardin. Or get some congressional action here to 
give you clearer direction.
    I understand your position, but that doesn't give us 
comfort here. Making it as clear as I possibly can be, I am 
against drilling off the mid-Atlantic, and I am going to do 
everything I can to prevent drilling off the mid-Atlantic. So 
that is not going to come as a surprise to you.
    But from the point of view of where new drill sites should 
be located, I would hope at least there is a process in place 
before you move forward, so the public and the drilling 
companies and all of us understand what protections are in 
place before you issue new permits.
    I would hope it is more than just receiving a report, but 
instituting the changes that are necessary to prevent this type 
of catastrophe from happening again. And I very much appreciate 
the fact that you are there, and I know that you will do the 
right thing, and I hope part of that is taking the mid-Atlantic 
off the table.
    With that, let me turn the gavel back to our Chairman so I 
can go vote. I know you are disappointed about that.
    [Laughter.]
    Senator Boxer [presiding]. They are waiting for you, 
Senator.
    Mr. Salazar. He is a great Chairman, Senator Boxer.
    Senator Boxer. Yes, I know, and I am fortunate I have 
wonderful, wonderful reinforcements here if I have to leave.
    Senator Voinovich, the floor is yours for 10 minutes.

        OPENING STATEMENT OF HON. GEORGE V. VOINOVICH, 
              U.S. SENATOR FROM THE STATE OF OHIO

    Senator Voinovich. Thank you, Madam Chairman.
    First of all, I appreciate the witnesses' being here, and I 
can tell, Mr. Salazar, that you are under a lot of pressure. 
You look tired, and thank you for being here.
    Mr. Salazar. I don't feel tired. I feel confident, and I 
feel resolute in what we are doing.
    Senator Voinovich. Great. As Secretary of the Interior, you 
are in charge of the MMS, which oversees the activities in the 
Gulf of Mexico. I watched 60 Minutes on Sunday, and there were 
three people that talked: Mike Williams; Transocean's Chief 
Electronics Technician on Deepwater Horizon, Professor Bob Bea 
of U.C. Berkeley; and Ken Abbott, a former engineer at BP.
    In the interview Mr. Williams, who worked for Transocean, 
describes three possible technological failures that occurred 
leading up to the disaster: damage to the rubber gasket, called 
an annular, at the mouth of the blowout preventer; a device on 
the ocean floor that is supposed to prevent an uncontrolled 
surge of pressure reaching the oil rig; a hydraulic leak; and 
an unreliable control pod that may have prevented the emergency 
disconnect from kicking in that should have severed the pipe 
leading from the out valve to the oil rig.
    He also described a chain of command problem where he 
claims that they were pressured by BP to move forward with it.
    Professor Bea of Berkeley, I think you made reference to 
this, he did Katrina. He did the space shuttle Columbia 
disaster. He argued that damage to the annular was of 
significant concern and that it prevented rig operators from 
correctly gauging the amount of pressure that had built up 
inside the well. He stated that standard operating procedure is 
when control pods fail it should be immediately replaced.
    And then Mr. Abbott, he worked for BP, managed the 
engineering drawings for BP. He claims that 89 percent of 
engineering drawings had not been inspected or approved by BP 
engineers and that 95 percent of the welding plans have never 
been approved. This is supposedly backed up by BP internal 
mail.
    The question I have is, what kind of regulation does MMS 
have? I worked for 10 years on the Nuclear Regulatory 
Commission, and we have it now. We have the Davis-Besse 
problem, and we have unbelievable changes. But they take 3 
years to go through to look at all of the stuff that is 
necessary in terms of building a new nuclear reactor, a new 
facility. And the question is, what kind of inspection do you 
have? How many people from your shop were on the rig? How many 
of your people oversee the plans to make sure that they are 
complied with?
    I cannot believe that with this kind of a rig--you know, we 
had Three Mile Island. It cost $1 billion to fix it. We didn't 
lose 11 people. We lost 11 people on this rig. And only God 
knows what the ecological damage is going to be here. Quite 
frankly, it could be a lot more than any Three Mile Island 
problem.
    I think that this is significant. There are people out 
there, environmental groups now that say we have to stop doing 
this. Well, the fact of the matter is we have to continue to do 
this, but the issue is how do you do the job? And from my point 
of view, the agency did not do the job.
    How many people do you have working for the agency? What 
are their competencies? How many did you have a year ago or 2 
years ago? Then there is another one that they talked about, 
the Atlantis, that one of the witnesses or one of the people 
said that that is a disaster ready to occur.
    So I am just wondering what the devil does MMS do? And 
ought now we look at maybe the Nuclear Regulatory Commission to 
look at the kind of approval that needs to be made in terms of 
the gizmos that they use, they have to prove that; the design 
of the facility; the safety things that are in place and so on.
    Mr. Salazar. Senator Voinovich, we will make sure that the 
United States of America, including this Congress and the 
agencies in the executive branch learn every lesson to be 
learned from this incident. That I can promise you.
    I did not watch the 60 Minutes episode that you refer to, 
but the fact of the matter is that I do know that there are 
1,000 different stories out there about what happened and what 
the facts were. We will learn the truth. The Presidential 
Commission, along with the other investigations that are 
underway, will be able to pinpoint it.
    Senator Voinovich. Our problem always around here is 
something happens, and we spend all our time going back over it 
rather than saying here we are today, and what do we need to go 
forward. We have Davis-Besse. It was a problem. They changed 
the whole operation in terms of inspection, in terms of the 
people that were on at the facilities. The NRC changed the way 
they did things. Businesses changed things.
    What I want to know is what kind of an organization are we 
going to put together so that this kind of thing doesn't happen 
and we can assure the public that if we do another one of 
these, which I think we need to do, the same thing is not going 
to happen again.
    Mr. Salazar. The answer to that, Senator Voinovich, is that 
it will happen, and it is going to happen through two ways. 
First, we are taking action within the executive branch to make 
sure that this problem never occurs again. Second, this 
Congress needs to take some action to support some of the 
efforts that we will be undertaking to make sure that this 
incident doesn't happen again.
    Senator Voinovich. For example, did you have anybody on the 
rig? Was anybody from MMS on the rig?
    Mr. Salazar. No one was on the rig that day of the 
explosion, but the facts are whether it is 60 Minutes or any 
other anecdotes or comments or stories that you are hearing 
here, there is a lot more to this investigation, much of which 
is yet to be uncovered.
    Senator Voinovich. Why wasn't somebody from MMS on that rig 
24 hours a day overseeing what they were doing to make sure 
that they were doing this according to what they were supposed 
to be doing? Why didn't you have somebody on there?
    Mr. Salazar. Senator Voinovich, we have, as I recall, 62 
Inspectors in the Outer Continental Shelf. We have overseen and 
have had over 36,000 wells alone drilled in the Gulf of Mexico. 
There is a significant and robust enforcement and inspection 
mechanism.
    The question I think is an appropriate one relative to can 
it be done better. The answer to that is yes. How we do that, 
we will be doing our own reorganization, much of which we have 
been working on very hard since I became Secretary of Interior, 
but there will be more to do.
    The proposal that is in front of you asks for additional 
inspectors so that the job can be enhanced. The budget, which 
is before you for 2011, did the same thing a long time ago. 
Safety measures that were supposed to be enhanced have been 
proposed multiple times over the years. Some of them have been 
adopted. The National Academy of Engineers, which is the 
equivalent of the National Academy of Sciences, we brought them 
on in September of last year to put forward for us what were 
the safety measures so they would not----
    Senator Voinovich. I am running out of time. I would 
suggest to you that you or somebody in your shop get together 
with the NRC to find out how they go about doing their work and 
the kind of regime that they have in place to see how much of 
that kind of thing is relevant to what you are doing.
    Second of all, we have another example of where we have 
asked an agency to do a job, having the right people with the 
right knowledge and skills at the right place at the right 
time, and we haven't given you the wherewithal for you to do 
your job.
    You are going to be asking for more people, but the fact is 
that too often what we do around here--and Lisa, the same thing 
in your shop--how many people do you need to get the job done? 
So I am saying I think those things will do more to give the 
public comfort than to go back and spend, and I mean we ought 
to hold these people responsible. We ought to fine them or 
whatever should be done.
    But the real issue is how do we go forward? And if we don't 
go forward the right way, we are going to have another 
situation like we had with Three Mile Island where nothing got 
done in the nuclear area, and the rest of the world took the 
leadership in this area, and we lost out.
    I think we need to go forward, but we can't go forward 
unless you have a new protocol and you have the people that you 
need. Twenty-four hours a day, I would have somebody on that 
thing, or two people, to get the job done.
    Mr. Salazar. If I may, Senator Voinovich, first, you will 
have a report to the President by the end of the month, which 
will set out some interim measures, and there will be a lot 
more coming from that.
    Two, we are not afraid of science. We are not afraid of the 
best technology. And so Marcia McNutt, who is the head of USGS 
and who is one of the best scientists in the world, along with 
Steven Chu and the Energy Labs are helping us in terms of 
dealing with the immediate problem in the Gulf. But I also have 
asked them to help us in terms of dealing with safety measures. 
So we are on the case, sir.
    Senator Voinovich. Thank you. And last but not least, I 
sent you a letter on April 19th in regard to leases and so 
forth. I know you have been busy, but I certainly would like to 
have somebody look at my letter and get back to me with the 
answers.
    Mr. Salazar. Will do, sir.
    Senator Voinovich. Thank you.
    Senator Boxer. Thank you, Senator.
    Senator Klobuchar.

           OPENING STATEMENT OF HON. AMY KLOBUCHAR, 
            U.S. SENATOR FROM THE STATE OF MINNESOTA

    Senator Klobuchar. Thank you, Madam Chairman. Thank you for 
convening this hearing.
    Thank you to our witnesses.
    A few weeks ago I saw first-hand the oil slick covering the 
Gulf of Mexico. As everyone who has seen it knows, it is worse 
than what you see on TV, and that on TV you may just see one 
shot, but you see when you are there the miles and miles of 
orange.
    We met with Mr. Strickland. Secretary Salazar, he was very 
helpful. It was clear to me, as you noted at the beginning of 
your testimony, Secretary Jackson, that people are working as 
hard as they can.
    But last week in this room we listened to the leaders of 
BP, Transocean, and Halliburton testify about how each of their 
companies may not be at fault for this disaster. It reminded me 
of a group of kids who knock a baseball through a neighbor's 
window, and then they are all pointing at each other.
    We all know that the consequences of this action go far 
beyond repairing a window. The lives of 11 families cannot be 
repaired. The lives of thousands of families on the Gulf Coast 
have already been turned upside down. A month after this 
disaster we still don't know how much oil is spewing from the 
sea bed. Recent estimates range from a few thousand barrels per 
day to as much as 70,000 barrels per day.
    I know that your offices and your staffs have been focused 
on this terrible tragedy, but I also know that when these 
tragedies occur, people want answers. I know this from my 
former job as Prosecutor. I know you know that as well, 
Secretary Salazar, from your work as Attorney General.
    The American people first want to know how and when the 
disaster will end. And second they want to know how we will 
prevent from ever happening again. And finally they want the 
responsible parties to be held accountable and to ensure that 
the victims' families and the American taxpayers are 
compensated.
    At our hearing last week there were many questions posed to 
the companies that went unanswered. I am hopeful that we can 
get some answers today.
    I am pleased that the President has called for the creation 
of an independent panel along the lines of the Three Mile 
Island Commission and the Space Shuttle Challenger Commission, 
and I am glad that it will be made up of experts.
    Today, I specifically look forward to hearing from my 
questions as well as others about how bad the leak is right 
now, what the plan is to finally stop the leak, what the 
Federal Government is doing to prevent future disasters like 
this, specifically related to polluter liability. And then 
finally I would like to know how you are preparing to enforce 
our existing laws.
    So my first question will be to you, Secretary Salazar. You 
recently announced proposals to reform the Minerals Management 
Service, which includes separating the inspection arm of MMS 
with the royalty collection arm of the agency. You also called 
for increased funding for the inspections.
    Although BP, Transocean, and Halliburton, among others, 
should be held responsible for the oil tragedy, I agree with 
the President's statements and your statements, including what 
you made here today, that our Government officials should also 
be held accountable in terms of how we are going to make this 
work for the taxpayers today and in the future.
    In addition to the reforms that you have suggested in 
splitting the agency, have you reviewed the staff in place at 
MMS? I know there was a change made yesterday. Have you 
reviewed the staff to make sure we have the right people in 
place to implement your reforms? And which of the reforms that 
you have proposed are being implemented today as opposed to 
being implemented later by Congress?
    Mr. Salazar. Thank you, Senator Klobuchar. Let me first say 
that you are correct in your framing this as a collective 
responsibility because it is a responsibility, yes, first, of 
the companies, BP and others involved, but there is also 
responsibility to be shared with the Federal Government, with 
the executive branch, the Department of Interior, my 
department, and MMS, as well as with this U.S. Congress and the 
national legal framework that has been created with respected 
to the OCS.
    There is much work to be done, including the creation of 
organic legislation for an agency that has such a robust and 
important mission for the United States of America. We have 
announced many reforms over the last 16 months, ranging from 
ethics reforms, ending the Royalty-in-Kind Program, to 
separating the revenue functions from the inspection and 
enforcement functions of MMS and the Department of Interior.
    We are not resting there. Our work will continue, and in 
the days ahead you will see additional reforms that will be 
announced relative to the organization.
    Senator Klobuchar. And that includes looking at the 
staffing of the organization?
    Mr. Salazar. I would say there are 1,700 people, Senator 
Klobuchar, within MMS. About half of them are involved in the 
revenue collection program at MMS. Within those 1,700 people, I 
would say most of them are good people. They are good public 
servants, just like you, and just like all of the other public 
employees that we do have.
    But just like with any other organization, there are bad 
apples. In this particular agency, which I inherited, you know 
the well publicized sex and drug scandal where people were 
prosecuted, people who were fired and let go. We have tried to 
take that out, as Justice Warren would say in one of his famous 
decisions, root and branch. But it is a difficult process.
    To the extent that there are those kinds of ethical lapses 
that are going on, we will make sure that we root them out. We 
have the Inspector General already as part of the coherent 
investigations that we are making, looking specifically at 
personnel issues within MMS.
    Senator Klobuchar. Are you going to look at the revolving 
door issue of people who are too close with the oil industry?
    Mr. Salazar. That has been clearly one thing that has been 
going on from day one. There are prohibitions that have been 
put into place with respect to the revolving door. I think we 
are in much better shape today than we were 16 months ago. It 
doesn't mean that there isn't room for improvement, and to the 
extent there are major changes that have to be made and minor 
changes, we will not turn away any good idea.
    Senator Klobuchar. Thank you.
    Secretary Jackson, could you give us some idea of after 
nearly a month when you think the leaks will be plugged and if 
there are barriers that are preventing the quickest and most 
effective solutions here?
    Ms. Jackson. Yes, I am happy to, Senator, although I would 
probably defer to Ken. MMS's responsibility is also 
operationally now dealing with wellhead, and EPA is focused 
more on the environmental impacts and trying to at least get 
data to begin to document and answer questions about public 
health and environmental impacts over time.
    But I think we heard Secretary Salazar earlier say that in 
addition to the riser insertion, which has been done, the next 
step will be this top-kill approach. My understanding is that 
is over the next several weeks. Is it, Ken? Projected data for 
the kill is Saturday and Sunday, May 22 through May 23.
    Senator Klobuchar. OK. Do you understand--and maybe this is 
more in your area. If it is Secretary Salazar's, that is fine. 
How much oil is really gushing out? And why don't we know that?
    Ms. Jackson. I think I would agree with you that we do not 
know it at this time. I think that the initial estimates were 
made based on images and on scenarios that turned out over time 
to be changing at best. I think that it is an important piece 
of information for us to have, if not right this second, 
certainly going forward because it will shape, I am sure, 
damage assessments if nothing else.
    Mr. Salazar. If I may just add to that, because it is an 
ongoing effort, and it is a very important question which 
several Senators have already raised, to have an independent 
and truthful number relative to what has come out of this pipe. 
It is something that we take very seriously. That is why a 
number of agencies, including the United States Geological 
Survey, NOAA, as well as outside scientists have been working 
on trying to come up with something that we can have confidence 
in in terms of a number.
    Senator Klobuchar. Chair Sutley, in your testimony you 
state that the MMS applied an existing categorical exclusion 
review process for the Deepwater Horizon project. This 
exclusion for Deepwater Horizon was established more than 20 
years ago. Are you aware of how many existing projects MMS 
applied the same categorical exclusion to? And are you working 
with other department heads to ensure the projects that 
received a categorical exclusion are indeed safe?
    Ms. Sutley. Thank you, Senator. As I said in my testimony, 
my understanding is that MMS applied an existing categorical 
exclusion. These are widely used throughout the Government, and 
they are intended to be used in circumstances where we have a 
lot of experience with activities and we know that they are 
likely to have little or no significant environmental effect 
either individually or cumulatively.
    We are working closely with the Department of Interior 
supporting the MMS reform efforts.
    Senator Klobuchar. But you don't know how many other 
projects got this exclusion?
    Ms. Sutley. I do not know.
    Senator Klobuchar. Do you think we should be reviewing them 
now that we see that this wasn't safe?
    Ms. Sutley. We announced on Friday that with the Department 
of Interior we would be reviewing MMS's NEPA procedures, 
including their use of categorical exclusions. As I said 
earlier in my testimony we proposed in February to update our 
guidance to the agencies about the use of categorical 
exclusions to ensure that agencies are applying them in the 
proper way, that agencies are reviewing their own use of 
categorical exclusions, and that CEQ would review agencies' use 
of categorical exclusions.
    Senator Klobuchar. I see my time is up, but thank you. 
Clearly, something went wrong here and the process has to 
change.
    Thank you.
    Senator Boxer. Thank you, Senator.
    I just wanted to let people know what is happening. The 
order of questioners is as follows. We are going to go to 
Senator Alexander next, and then Lautenberg, then Barrasso, 
then Udall, then Vitter, then Whitehouse.
    And Senator Lautenberg and I have to go together to a very 
important meeting, so we are going to leave together. I have 
asked Senator Whitehouse if he would take the Chair. So 
Senator, as soon as we leave, if you would take the Chair.
    So we will proceed with Senator Alexander.

          OPENING STATEMENT OF HON. LAMAR ALEXANDER, 
            U.S. SENATOR FROM THE STATE OF TENNESSEE

    Senator Alexander. Thank you, Madam Chair.
    I want to thank the witnesses for being here. I know this 
has been a very busy and difficult time for the three of you, 
and I thank you for your time today.
    I want to talk first--or discuss with you first--a little 
bit about putting all this in perspective. It is difficult to 
put a tragedy in perspective. I was thinking of a terrible 
airplane crash with many people killed. That happens in the 
United States, unfortunately. And what do we do? We immediately 
have highly professional people go see if we can find out what 
went wrong, what we can do to prevent it again, and we have 
come up with a number of safety improvements, and we have black 
boxes and other things to try to find out things.
    But one thing we don't do is we don't ground all the 
airplanes. We don't stop flying because that would be I think 
about 1.6 million Americans a day fly, and it would bring our 
country to a halt if we stopped flying.
    I think it is important--and I believe the President has 
tried to do this--is the first job in putting this into 
perspective is to help Americans to understand just how much we 
rely on oil from the Gulf. If my figures are about right about 
30 percent of all the oil that we produce in the United States 
comes from the Gulf region. You mentioned a few minutes ago 
that there were more than 30,000 wells.
    We haven't talked much about it, but our natural gas comes 
from there as well. It is hard to drill for oil without finding 
natural gas or drill for natural gas without finding oil. About 
25 percent of all our natural gas comes from wells in the Gulf 
of Mexico, and we produce almost all the gas that we use. So 
that is an even more important part of what we use than oil.
    So isn't it true, Mr. Secretary, that as terrible as the 
tragedy is, that unless we want $14, $16, $18, $20 a gallon 
gasoline, that it is not realistic to think that we would 
actually stop drilling for oil and natural gas in the Gulf of 
Mexico in the foreseeable future?
    Mr. Salazar. The answer to that is, you are correct, 
Senator Alexander, and that is why the President's reaction to 
this has been one of thoughtfulness and being calm and not 
making decisions in the eye of the storm. That is when you make 
bad decisions. And so his direction to us is to move forward 
with developing the kind of information on safety and on 
environmental protection and being thoughtful relative to how 
we move forward on the OCS.
    Senator Alexander. I appreciate his leadership in that way, 
and I appreciate the tone of his leadership.
    The second aspect of perspective, it seems to me, and you 
mentioned this a little bit, as others have, what can we do 
instead in terms of alternative forms of energy? I have heard 
people say we need more wind. We need more solar. We need more 
biomass. I hope we do use more biomass. I would like to get the 
cost of solar cut by a factor of four, as Dr. Chu has 
suggested, so we can actually use it in a competitive way on 
rooftops across the country. I am less enthusiastic about wind 
turbines than you are, but we have discussed that many times.
    The truth is that we don't need wind. We don't need solar. 
We don't need biomass to reduce our oil use because we don't 
need extra electricity to run electric cars. Mr. Sandalow, who 
is in the Department of Energy, has said that we could 
electrify half our cars and trucks in America without building 
one new power plant of any kind simply by plugging our electric 
cars and trucks in at night and using this vast amount of 
unused electricity we have.
    Now, the President has been very strong on electric cars 
and trucks, and there is bipartisan support for that in the 
Congress. Wouldn't an important part of putting this into 
perspective be for you and the President and others to say of 
the clear alternative we have, the best alternative we have for 
reducing oil over the next 15 or 20 years is to have as a goal 
electrifying half our cars and trucks? That is a very ambitious 
goal.
    Even if we did that, we would still be using about 12 
million barrels of petroleum products a day, but it would cut 
by a third the amount of oil that we are using and greatly 
reduce the foreign oil we use. Isn't this an opportunity to 
encourage more use of electric cars and trucks as the most 
viable option for reducing oil?
    Mr. Salazar. Senator Alexander, you know well the President 
has spoken many times about the need for a comprehensive energy 
program. In that comprehensive energy program, electric cars 
and the new technology that is unfolding here in the United 
States have been very much a robust part of that, which he and 
Secretary Chu have championed, along with the portfolio of 
energy resources that will move our economy and will move the 
energy needs of the Nation.
    The exact number in terms of electrical cars, I don't have 
an answer to you on that, but I am sure that we get back to you 
on exactly what it is that the Department of Energy is 
projecting is going to happen in that arena.
    Senator Alexander. I appreciate your answer, and it is 
properly diplomatic, befitting a Secretary, but I guess what I 
am trying to do is discourage the talk that if we just build 
more windmills, we can reduce the use of oil because it doesn't 
have anything to do with our use of oil when in fact we have 
plenty of electricity for electric cars and trucks, which is 
our best option, and the President is a chief proponent of 
electric cars and trucks. I would like to encourage him to push 
it more.
    I would like to shift to one other area which has come up, 
in the time I have remaining. I remember when I was a young 
Governor, I had a cabinet meeting, and we wanted to pass a bill 
in the legislature. I said, well, we all agree with this. 
Everybody agreed. We went out and came back the next week, and 
nothing had happened.
    I said this obviously isn't going to work. So we put one 
person, as we said, on the flagpole. We called him Granny 
Hinton. He was on the flagpole. He came back the next week. The 
bill had been passed because he was accountable.
    I thought about that the other day when Captain Bill 
Ostendorff testified. He is a former Navy sub commander. He is 
one of the President's appointees to the Nuclear Regulatory 
Commission, one of several very good appointments the President 
has made. He testified that 4 of his 11 commanding officers 
were disciplined at some point in their career for a problem 
with their nuclear reactors in the Navy subs.
    Now, no one has ever died in a Navy sub. People have been 
living on top of nuclear reactors since the 1950s. I suspect 
one reason is the word accountability. If there is a problem 
with the reactor, the answer to the question of who is on the 
flagpole, is it is the captain's problem. He can't buck it to 
anybody else.
    We watched several people from industry suggesting that 
others from industry were responsible for the oil spill. We 
have 14 agencies in the Federal Government who have something 
to do with oil drilling and regulation.
    So I am wondering, isn't there a lesson perhaps to learn 
from the nuclear industry, and particularly from the nuclear 
Navy about accountability as we go forward? We have the answer 
to the question of who is going to pay. It sounds like BP is 
going to pay. They are the responsible party. But on the 
whodunnit question, I mean who did it, who is on the flagpole 
for that, it seems to me that we don't have an answer to the 
question of who is on the flagpole when there is an oil spill 
or an oil gush at the bottom of the Gulf of Mexico.
    Would you agree with that? And would you think that that 
might be a good direction for the investigation and the 
commission's work to help us identify an answer to the question 
of who is on the flagpole for an oil spill or oil gush?
    Mr. Salazar. Senator Alexander, let me say three things. 
First, I think there is a lot to learn from the nuclear world 
relative to safety issues here, which is part of the reason why 
Secretary Chu has been so involved with us as we look at safety 
measures that we will be recommending to the President.
    Second, the facts here still need to be known. And once the 
facts are known, we will look at the range of civil as well as 
criminal culpability that may have in fact be inherent in this 
incident. No one will be spared. That includes Government 
officials. So that will be something that will be looked at, 
and that is why there is such an inherent importance in what 
the President has done in pulling together a Presidential 
Commission so that we can get to the bottom of the story.
    Third, there will be significant reform, some of which we 
will take on and have been taking on within the executive 
branch, and new organizations that address some of the issues 
which Chairman Boxer alluded to in her statements and in her 
questioning.
    But there also will be an opportunity for this Congress to 
help us figure out how we move forward to achieve the goals 
which I heard Senator Klobuchar and others speak about, and 
that is to fix a problem and prevent the problem from ever 
happening again.
    Senator Alexander. Thank you. If I could take my last 10 
seconds, I think we know who is on the flagpole for paying the 
bill for the oil spill. That is BP. That is in the law. I think 
we know who is on the flagpole if there is a problem with a 
nuclear reactor in the Navy. It is the captain. I think we 
don't know who is on the flagpole for the next oil spill, and I 
think that would be the very best way to do this. That would be 
better, knowing who is on the flagpole, than this idea of 
collective responsibility.
    Mr. Salazar. If I may just on responsibility, because I 
think one of the things that in the heat of the moment there 
also is a huge effort that is underway in the Gulf. I can tell 
you what this Congress has done with respect to homeland 
security and the processes that are set out there. You have a 
very massive program that is underway to protect the Gulf and 
to deal with this problem, which is being led by the National 
Incident Commander under a National Unified Command that has 
20,000 people out on the ground. It has 700 vessels out trying 
to deal with the spill. It has this massive effort undersea.
    So it is clear with respect to the oil spill response 
responsibility for that lies within the law. But I do agree 
with you, Senator Alexander, much in the same way as other 
commissions you and I have talked about, that there are 
tremendous lessons to be learned here organizationally.
    Senator Alexander. Thank you, Madam Chairman.
    Senator Boxer. Thank you, Senator.
    Senator Lautenberg.

        OPENING STATEMENT OF HON. FRANK R. LAUTENBERG, 
           U.S. SENATOR FROM THE STATE OF NEW JERSEY

    Senator Lautenberg. Thanks, Madam Chairman.
    I want to present part of my statement just to say thank 
you for conducting this hearing. We have been through several 
hearings, and we keep finding out that we are disappointed in 
responses from the oil companies. But we are here to discuss 
the Federal response to the tragedy, and it is crystal clear 
what the Federal response ought to be: bring dangerous offshore 
drilling pursuit to an end. Should we say no more special 
favors and special treatments given to big oil. And it should 
end up here with our search for reliable, sustainable sources 
of energy and not take our eye off the ball.
    I introduced a piece of legislation, the Beyond Petroleum 
Act, to move us in the right direction, and that is to charge a 
fee on offshore drilling leases and generate nearly $2 billion 
a year. Even that is a drop in the bucket for oil companies 
that made more than $23 billion in profit in just the first 
quarter of this year and still want to duck their 
responsibilities.
    These funds should be directly invested in research and 
development of next generation engines, clean and safe fuels, 
tools and innovative approaches to transportation. We also need 
to pass a comprehensive energy and climate bill that focuses on 
clean energy jobs, at reducing pollution, and protecting our 
vibrant coastal economies from the menace of offshore drilling. 
These should be our priorities as we look to the future.
    Let's be clear. Big oil doesn't deserve our trust. We all 
saw that sad spectacle last week. At Senate hearings oil 
company executives were so determined to dodge responsibility, 
they almost broke their fingers pointing at one another. They 
were bobbing and weaving and dodging and pointing to the other 
guy.
    That is why I joined with Senator Menendez and Senator 
Nelson to end the big oil bailouts by raising the liability cap 
for all companies, from a piddling $75 million to $10 billion. 
And we hear arguments about companies that can't afford it. If 
they make a big mistake, they owe a big bill, and they are 
going to have to pay it somehow, either they or their insurance 
companies. They shouldn't be excused.
    But we are not going to rest until every last cent of the 
Administration's response is paid for by the oil companies. You 
called for that, Mr. Secretary, and we salute that. So we can't 
continue to gamble with these precious resources by allowing 
more offshore drilling.
    What I want to confirm here now is the fact that NOAA has 
accused the M.M. Service of a pattern of understanding the 
likelihood and potential consequences of a major spill in the 
Gulf and the frequency of spills that have already occurred 
there. NOAA points out that several or your Department's 
conclusions on oil impacts ``directly conflict with studies of 
major spills.''
    Why did Interior continue to push for an expansion of 
offshore drilling even though there was a question raised by 
NOAA scientists who found major flaws in the analysis?
    Mr. Salazar. Thank you, Senator Lautenberg.
    Let me just say that we--before we got to the end of March 
announcement on the future of the OCS--took into account the 
comments and input that we received from many different places. 
It was in fact in part because of comments, not principally 
from NOAA, but from others like the Coast Guard and others, 
that you do not have the five lease sales that were planned to 
be taking place in the Arctic Ocean and the Beaufort and 
Chukchi Seas and in Bristol Bay.
    We counseled them. We said that Bristol Bay ought to move 
forward with some kind of permanent protection. We said that 
with respect to Chukchi and Beaufort that the oil spill 
response capabilities and other science that we needed to have 
before allowing the development to take place there was 
something that required us to cancel those leases. And so those 
were canceled. We did the same thing with respect to the 
Pacific because of a whole host of issues in the Pacific.
    So we did take into account comments and information that 
we received from organizations like NOAA. More importantly, 
however, let me also say that if I ever hear that one of the 
employees of the MMS is essentially throwing science under the 
bus, heads will roll because that would not be appropriate for 
people who work within the Department of Interior.
    Senator Lautenberg. You have called for a pause in new 
drilling permits until a complete investigation of the cause of 
the Gulf spill is done. Even if we identify the cause of this 
spill, will that information really allow you to guarantee that 
another massive oil spill will not threaten our coast? The 
executives who appeared before us in the hearing last week said 
they would not guarantee that there couldn't be another spill 
like the one that they have had.
    Mr. Secretary, I can't imagine that we would permit 
anything to take place, at least I hope not, that might cause a 
spill something like the ones that we have or any of them. I 
think we ought to avoid oil spills at any price because when 
they spill they seem to get worse and worse and worse in their 
intensity.
    Mr. Salazar. Just two quick things. Nothing in life is 
risk-free, and no development ever in the OCS--whether it is 
for wind power or whether it is for oil and gas--will be 
completely risk-free. Those are the facts of life.
    Two, there are significant safety enhancements which I am 
sure will be put on the table as we move forward with the 
safety reviews. The report to the President from my Department 
is due at the end of May. There will be additional information 
after that time as well. And so we will move forward to having 
a regime which is a much safer regime than we have had in the 
past.
    Senator Lautenberg. Mr. Secretary, should these spills that 
we have seen demand a halt to all new drilling, shift to an all 
hands on deck policy in an effort to develop and deploy 
technologies that will end our dependence on oil and fossil 
fuels, and especially doing business with those who are not 
friends of ours but are involved in a conspiracy to take 
advantage of us?
    Mr. Salazar. Senator Lautenberg, I think you and members of 
this Committee have been working very hard on moving us forward 
with a new energy future for the United States of America. The 
President has been pushing hard for a comprehensive energy 
plan. This incident in the Gulf Coast I think is another 
clarion call as to why we need to move forward in that 
direction.
    But we should also be very frank with ourselves in this 
Committee and in this country that we are dependent on oil and 
gas, and our economy is dependent on oil and gas, whether it is 
New Jersey or whether it is California. And how we incorporate 
those fossil fuels in what is a new energy economy and in 
transition is something that we are going to have to do.
    So we need to be balanced about it, and that is why the 
comprehensive nature of an energy approach that deals with 
energy independence and the national security issues that are 
at stake, the economic security of the country, and the 
environmental security of the country from the dangers of 
pollution that come from the emissions are something that we 
need to deal with.
    Part of the shared responsibility here, Senator Lautenberg, 
ought to be not to kick those issues on down the road for 
another Congress or another time.
    Senator Lautenberg. I want to thank each one of you for 
your excellent testimony. I would ask, Administrator Jackson, 
are you concerned that the EPA has such a small, almost 
nonexistent role in our Government's action on oil drilling off 
our coast?
    Ms. Jackson. Senator, I wouldn't say it is nonexistent, but 
I am concerned with what I see in terms of our role, even in 
our performance of the role we have. We have a very important 
role on preparedness, and we have a very important role under 
the National Contingency Plan on response. And even though we 
aren't in the lead, I will be the first to say that I believe 
my staff are working very hard, but that we will learn lessons 
from this entire incident, which is far from over, that will I 
think possibly mean we need some changes, possibly in the law, 
certainly in the regulations.
    Senator Lautenberg. How about on a longer-term solution, 
should oil companies play a part in more funding on the 
research and development of new technologies that get us, to 
use BP's own expression, ``beyond petroleum'' ?
    Ms. Jackson. I certainly think that there is a need. The 
one thing I have taken away so far is that the ability to get 
this oil out of the ground has far surpassed our ability to 
respond to the worst case scenario. And so for us, I am 
concerned. Dispersants has been an issue. I spent the better 
part of the last 3 weeks working on it, and I am amazed at how 
little science there is on that issue for something that is 
such a primary tool in this response.
    So we are on the ground trying to minimize and make the 
best decisions we can, but there are a range of issues that I 
think even if you look at the petroleum response itself and the 
cleanup response, haven't moved along.
    Senator Lautenberg. And I remind our colleague from 
Tennessee that we do stop flying when we know that there is 
imminent danger, whether it is volcano ash or whether it was an 
attack on our financial center by others. We stop flying, and 
what we ought to do is stop drilling.
    Thank you.
    Senator Boxer. Senator, tell us what you really think.
    [Laughter.]
    Senator Boxer. Senator Whitehouse, if you would do me the 
honor of taking the seat here. We are going to continue hearing 
from, in this order, Barrasso, Udall, Vitter, and Whitehouse. 
And I would ask if you would stay and run this hearing. We then 
will hear from the Coast Guard, the Assistant Secretary of the 
Army for Civil Works, and the Assistant Secretary of Commerce 
for Economic Development.
    And so, Senator Barrasso, I look forward to reading about 
your comments. Why don't you wait until it all calms down.
    Senator Barrasso. Thank you, Madam Chairman.
    Senator Boxer. And I want to thank everybody on the panel.
    Senator Whitehouse [presiding]. Senator Barrasso.
    Senator Barrasso. Thank you very much, Mr. Chairman.
    Ms. Jackson, Senator Boxer showed a video early on with 
that new deep-sea straw in place. I am still trying to quantify 
the level of this. In the first week that this happened, it was 
thought it was about 1,000 barrels a day. Then it was up to 
about 5,000 barrels. Now some scientists are saying possibly 
25,000 barrels a day. Secretary Salazar mentioned the 
possibility that this straw is about 1,500 to 2,000 barrels 
possibly.
    But looking at that, if that straw is in place, taking 
1,500 to 2,000 barrels out, that made me think that maybe our 
estimate of 5,000 barrels may be low because it looks like 
still massive amounts are spewing forth.
    Is that how you looked at it, too? Or any of you?
    Ms. Jackson. I think Secretary Salazar is probably more 
qualified than I to speak on that. I will say that the agency 
within the Government that has most of the expertise on 
estimating the release is NOAA. And so that is the only reason 
I am not going to take the question.
    Mr. Salazar. The only thing I would say, Senator Barrasso, 
is this is an ongoing operation, and this Committee should know 
that the emergency nature that we are in means that we are 
relentless and not resting and trying to stop the problem at 
the source.
    I think the video that you saw is actually a video before 
the operationalization of the riser insertion tube had been 
inserted, but it was ramped up through the day and overnight. 
And so the amount of oil which is currently being captured is 
at approximately the 2,000 barrel a day number. This is an 
evolving situation that will take place through not only 
tonight but also through tomorrow.
    At the end of the day what is more important than the 
optics of the visual are an independent quantification of the 
amount of oil that has flown from this well. That is something 
which is of the highest order of importance to the National 
Incident Commander and to all of the agencies that are 
involved, NOAA, EPA, USGS and others.
    Senator Barrasso. Thank you.
    Following up on some of the other discussion about the fact 
that over about a quarter of America's oil production comes 
from the Gulf, and with the nationwide halt of permits for new 
exploration, we need to get the energy from somewhere. So I 
want to visit a little bit about some of the things that are 
going on onshore.
    We have seen in Wyoming that investment in energy 
development on public lands in the West has dropped 
precipitously. In Wyoming revenues paid by private companies to 
the Bureau of Land Management for oil and gas, bonus bids, 
rental fees, were down from $93 million to $10 million between 
2008 and 2009; significant loss of revenue both to the country 
and to our State. Capital investment has shifted away from the 
Rocky Mountains, but we need to get the energy from somewhere.
    So I am concerned that the Administration's onshore 
policies are going to hurt rural economies in the West and 
leave Americans even more vulnerable to higher gas prices.
    The Governor of Wyoming has said the proposed changes in 
onshore potentially hand significant control over oil and gas 
exploration, development, and production to the whims of those 
that profess--and these are his words--``a nowhere, not ever 
philosophy to surface disturbance of any kind.''
    So my question to you is with regard to onshore leasing 
reforms. Were there any economic analyses performed on onshore 
leasings? Did you consult with State and local officials before 
finalizing the reforms? And in light of what has happened in 
the Gulf, are you thinking about reconsidering the changes to 
onshore in light of what we are dealing with offshore?
    Mr. Salazar. Senator Barrasso, there has been significant 
consultation with the Western Governors and the States and 
others concerning the onshore leasing reforms. But let me say 
that they have been part of the reform agenda from day one. It 
has met the same kind of resistance that we have met with the 
reform agenda on the Outer Continental Shelf and MMS.
    At the advent of my administration I canceled 77 leases 
that had been issued in the State of Utah. Well, I did it 
because we wanted to do it right and protect the environment 
and protect our national parks. We issued instruction memoranda 
that went out to redo the way categorical exclusions are done 
on the onshore.
    That is part of the reform agenda to make sure that we are 
doing it right, drilling in the right places, but also 
providing certainty to the industry. The onshore, as I have 
shared with you in the past, Senator Barrasso, the issues had 
become so difficult in allowing leases to go forward that most 
of them were being protested before they even got to the lease 
stage.
    So what we have done under the leadership of Director Abbey 
and Assistant Secretary Wilma Lewis is to move forward with a 
kind of proactive planning process that hopefully will provide 
certainty and will make sure the right environmental analysis 
is in place, and that we avoid the litigation that occurs when 
you don't follow those kind of processes.
    Senator Barrasso. It has been my impression, Mr. Secretary, 
that the reforms were undertaken really without going through 
the regulatory process. I know the Governor of Wyoming wrote 
you a 5-page letter in response to your proposal. So I would be 
interested to seeing how you addressed his concerns ultimately.
    Thank you, Mr. Chairman.
    I appreciate your comments, Mr. Secretary.
    Mr. Salazar. Thank you, Senator.
    Senator Whitehouse. Senator Udall.

             OPENING STATEMENT OF HON. TOM UDALL, 
           U.S. SENATOR FROM THE STATE OF NEW MEXICO

    Senator Udall. Thank you, Chairman Whitehouse.
    And thank you to all the panel here today.
    While the exact details of this manmade disaster are still 
unknown, a few things have become clear. Industry told Congress 
and the public we could rely on them for safety. Now, the era 
of self-regulation is over for the offshore oil industry. MMS, 
EPA, the Coast Guard, and the Council on Environmental Quality 
need to move swiftly to put responsible regulation in place.
    Another thing that we know, blowout preventers are not and 
never were a fail-safe. They are a last ditch measure when the 
well has had a major failure. The failure on the Deepwater 
Horizon was not unique. The record shows they often fail.
    As a result, we need solid regulatory standards to prevent 
operators from cutting corners on well control. Producers want 
to drill fast and move fast to save time and money, and 
Secretary Salazar, you know that behavior very well. Safety 
requires carefulness instead. Time is money on an offshore oil 
rig, and there is always an incentive to put profit over 
safety. This is a classic case for strong regulation.
    And so I guess this is a question to the whole panel, but 
Secretary Salazar focusing on you, and first of all let me say 
I have confidence that you are pushing BP as hard as you can to 
stop the spill and protect ecosystems. What I am wondering is 
the timeline. We have so many, as has been mentioned in the 
hearing, of the studies that are going on and investigations 
that are going on. And now the President has a comprehensive 
commission.
    Could you talk a little bit about the time table on how you 
see putting regulations in place, when this is going to happen? 
Because it is clear from the questioning here that we have a 
significant number of oil wells that are out there and that are 
operating. We don't know how many this could happen to 
tomorrow.
    So I think it is important that we get a regulatory hold on 
this. So please, Mr. Secretary.
    Mr. Salazar. Thank you very much, Senator Udall. Let me 
just answer that I think there are matters that will happen 
sequentially here. There have been numerous reforms which we 
have already initiated within the Department of Interior and 
MMS. Those will continue even in this week and the weeks ahead.
    No. 2, at the end of this month, the President will receive 
the report on safety recommendations. We are working very hard 
with scientists and experts to come up with the best report. 
The President will make announcements on how we will move 
forward on that.
    And then third, the longer-term investigations, they will 
be overseen by the Presidential Commission which he has 
announced and he will appoint the members of, and into that 
commission will flow the investigations that are underway, 
including the root cause investigation that is being conducted 
by the Coast Guard and MMS, with an oversight panel, the 
investigations and reports from the National Academy of 
Engineering, the investigations which I have ordered through 
the Inspector General, and other investigations that may be out 
there.
    But they should all be funneled into one place so in a 
similar vein that happened in the commission related to the 
Challenger, there will be a report, first of all, about what 
happened so the whole truth and nothing but the truth is told. 
And second that the lessons learned are the best lessons that 
can be learned from this horrific tragedy.
    Senator Udall. One of the things that has hit me in a way 
in the past in terms of regulations is if you look at MMS and 
you ask how do they promulgate regulations, many offshore 
regulations originate at the American Petroleum Institute and 
then are reviewed by MMS.
    Will MMS take more control over this process in the future, 
as you see it? And how is that going to work?
    Mr. Salazar. Senator Udall, the input that comes in comes 
not only from API but also from a whole number of professional 
organizations and scientific organizations. But ultimately it 
is the responsibility of MMS as an independent body to decide 
what those regulations should be.
    I expect that you are going to be seeing significant 
changes to some of those regulations based on the review that 
is being conducted and based on some of the information that I 
have been gathering as I have gone to visit blowout prevention 
manufacturers and the like.
    So this is a time of change, and I think it will be 
positive change. It will help us move forward with the right 
kind of safety measures in place with respect to development of 
oil and gas.
    Senator Udall. Thank you. I hope that all of you together 
move forward sooner rather than later in terms of getting some 
good solid regulations in place.
    Administrator Jackson, you used the term in your testimony 
here when you were referring to dispersants, when you were 
answering a question, amazed how little science there is on 
dispersants. The New York Times reported that the dispersants 
being used in the Gulf were banned in Britain. Is that correct? 
And if so, do we have any alternatives?
    Ms. Jackson. That is correct, but if I may I would just 
like to get a little bit more information because we had looked 
into that. There were tests done in Britain called rocky shore 
tests, and it appears from what we have learned so far that the 
reason for the ban had less to do with inherent toxicity and 
more to do with the near-shore impacts on certain clams and 
their ability to adhere to the rocky shores. We are still 
looking into it, but I think the answer would be yes, perhaps 
for different reasons and certainly in a different application 
than here.
    Senator Udall. How did we get ourselves in a position where 
we know so little about the science of dispersants? What do you 
expect we will be doing in the future in terms of dispersants, 
the science tackling these kinds of oil spills with these kinds 
of technologies?
    Ms. Jackson. Yes, just so I can be clear. There is 
certainly some science on dispersants. I don't want to dismiss 
good work that has been done. But in this incident so far an 
unprecedented volume of dispersants have been used in the Gulf 
of Mexico. And I think what that means is that lacking any 
other tools during this time when the release is continued 
there has been a real reliance on them, maybe more so than 
anyone ever thought would happen.
    And I think that the science hasn't continued along to show 
whether or not we are having a potential impact. There is 
nothing to indicate that, Senator. If I thought there were, we 
would stop it immediately. I have been very hesitant to take it 
out of the tool kit altogether, but I think long-term impacts 
to ensure that this stuff does not bioaccumulate, we have no 
data that shows it does. The MSDS says it doesn't.
    There have been some valid questions raised about the 
impact on the water column and the fate in transport. What 
happens to these dispersed particles? Do they really biodegrade 
quickly, or do they take a long time? And I think that is fair 
ground for research.
    Senator Udall. When you said it doesn't bioaccumulate, was 
that the MSDS? Could you tell me what the acronym is?
    Ms. Jackson. So sorry, Senator. MSDS stands for material 
safety data sheet. If you look on the Deepwater Horizon 
response.com Web site, that is one of the things that are 
posted for both the Corexit products that have been used.
    Senator Udall. If we find that the use of dispersants has 
had a damaging impact on natural resources, would BP be 
responsible for those damages as well, based on your 
understanding or Secretary Salazar's understanding with them, 
or Nancy Sutley's understanding?
    Ms. Jackson. My understanding is the response itself and 
the actions that are taken are part of the liability and part 
of the assessment that will be done. So just again, no one has 
ever argued that dispersants don't have an impact. We believe 
it lessens the impact to the marshes, which are so ecologically 
and economically important, but they are not without any 
impact. And so that would certainly be part of a damage 
assessment, I would think.
    Senator Udall. Yes.
    Secretary Salazar, I don't know if you have any final 
thoughts on that, with just a couple of seconds left here.
    Mr. Salazar. I don't have anything to add.
    Senator Udall. Thank you.
    Mr. Chairman, thank you very much, and thank you for 
chairing this hearing and being so instrumental.
    Senator Whitehouse. Thank you, Senator Udall.
    Senator Vitter.
    Senator Vitter. Thank you, Mr. Chairman, and thank you all 
for your ongoing work.
    I have been here as well as at a Commerce Committee hearing 
on the oil spill. I serve on that committee, too. So trying to 
bridge that divide, I am going to focus on exactly the same 
five questions and points I also focused on there.
    The first is under the Magnuson-Stevens Act, the 
Administration can and should in appropriate circumstances 
declare a fisheries failure, a disaster regarding fisheries 
when there is a God-caused or a man-caused event with a 
significant negative impact on fisheries.
    I have asked for that declaration. The Governor of 
Louisiana has asked for that declaration. This is obviously a 
huge event impacting fisheries. Why hasn't that been declared, 
and when will it be?
    Mr. Salazar. Let me just say that is a matter which the 
National Incident Commander would have under his review. I 
don't have the answer to that today, Senator Vitter, and I 
don't know that Nancy or Lisa do either. We will be happy to 
get back to you on that.
    Senator Vitter. If anyone on the second panel could answer 
that, or if you could get a written response as quickly as 
possible from the appropriate Administration official, I would 
appreciate it. Again, the point is simple. This is obviously a 
historic event with a big negative impact on fisheries. If this 
doesn't qualify, I don't know what does. And this would help 
trigger some immediate help to folks in the fisheries sector. 
BP will ultimately pay the bill, but timing is everything, and 
this can hasten some help to that sector.
    Second, and it is sort of similar, under OPA, the Oil 
Pollution Act, section 2713(f) doesn't simply allow--it 
mandates for the President to set up a loan program for 
fishermen and fishery dependent businesses. In fact, I will 
read it to you: ``The President shall establish a loan program 
under the fund,'' that is the trust fund, the OPA trust fund, 
``to provide interim assistance to fishermen and aquiculture 
producer claimants during the claims procedure.''
    Again, I have asked for that specifically. Why hasn't that 
happened, and when can we expect that to happen?
    Mr. Salazar. Again, I think that is a question for the 
National Incident Commander, and I would be happy to look into 
it and get back to you.
    Senator Vitter. OK. Thank you.
    Again, the point is similar. BP is going to pay the bill. 
BP is on the hook for economic damages. That is not a debate. 
But this can help provide immediate assistance to fishermen and 
folks in that sector, as can the disaster declaration because, 
as you know, paying those claims is going to take some amount 
of time, so this can be done more immediately.
    Third point is about a boom and other related supplies. I 
will direct that to the second panel and the Coast Guard 
Admiral because I am going to have to leave. According to the 
initial metrics, Louisiana was being shortchanged boom, quite 
frankly, as a ratio of mile of boom to mile of vulnerable 
coast, while Mississippi and Alabama were getting a ratio of 
something like 1 mile of boom to every 1.8 miles of vulnerable 
coastline. Louisiana was on a different planet, getting about 1 
mile of boom to over 10 miles of vulnerable coastline.
    I have sent a letter about this to Admiral Allen. I have 
talked to Admiral Allen three times. I believe that is moving 
in the right direction. I thank him for that, but my question 
for the appropriate panelist, perhaps on the second panel, from 
the Coast Guard would be what is the update on that, and when 
will that disparity be completely resolved.
    Fourth question, again, is probably for the second panel, 
and I apologize. I am going to have to leave.
    Mr. Salazar. I like this line of questioning, Senator 
Vitter.
    Senator Vitter. Right.
    Mr. Salazar. It is for the second panel.
    Senator Vitter. Right.
    [Laughter.]
    Senator Vitter. The State of Louisiana and local parishes 
have made a proposal to do emergency dredging and use the 
dredged material to build up the barrier islands and to plug 
certain gaps that have grown in some of the barrier islands. I 
know Administrator Jackson is somewhat familiar with the 
proposal.
    Obviously, time is of the essence, and so I wanted an 
update on the Administration's response to that proposal so it 
can get underway. And I would invite the Administrator to make 
any comments, and then on the second panel Assistant Secretary 
Darcy I know can respond to that.
    Ms. Jackson. Yes, I think the second panel and the Federal 
on-scene coordinator and of course the Admiral from the Coast 
Guard are ultimately going to have to make judgments regarding 
feasibility and efficacy. I would simply say that the 
environmental community for a long time has been trying to 
rebuild the coastline down there, and barrier islands are 
certainly an important part of that.
    The question that lies before the Commander and the 
Incident Commander will be the efficacy of that approach to 
deal with this particular emergency. That is going to have 
everything to do with time and ability to get it done. But I 
will defer to Jo-Ellen, I am sorry, the Assistant Secretary and 
the Admiral for their comments as well.
    Senator Vitter. OK. You are certainly right. Timing is the 
big issue, and this request has been out there for a week or 
more. So I look forward to that answer from the Assistant 
Secretary and encourage a concrete decision as soon as possible 
because timing is huge.
    The fifth and final point is for the Interior Secretary. 
Mr. Secretary, this goes to Senator Barrasso's question and 
some others. Many people I talk to are confused because this 
pipe is now hooked up, because we are now collecting some of 
the product, maybe 20 percent through that. Many people I speak 
to have the same reaction I do, which is that should be a major 
step forward in better calculating the amount of the flow, not 
that it can be done precisely now, but it should be a big tool 
so that you would think we can have a much better calculation 
than we could have 4 days ago.
    Is that correct? And if so, when are we going to get that 
more precise calculation?
    Mr. Salazar. It is absolutely correct, Senator Vitter, that 
that will give us a better sense of what has been flowing out. 
In addition to that, there are a whole variety of efforts that 
are underway to try to get a more precise and independent 
determination as to what these numbers are, because right now 
they are all over the place. The number that had been used was 
I think the best-considered number at 5,000 barrels per day. 
Whether it is more, whether it is less, we will have I think a 
lot more information on that as the week goes on.
    Senator Vitter. OK. Do you have a more precise timeframe? 
The pipe has been hooked up for several days, so as a layman, 
admittedly not an engineer, I would have thought we would have 
more precise estimates by now. But what is your timeframe for 
that?
    Mr. Salazar. Senator Vitter, what is happening in fact as 
we speak here is that the pressures are being adjusted. As the 
pressures are adjusted to bring up the production, they have to 
be very careful so that they don't essentially blow up this 
process and have to go back to the beginning or to essentially 
annihilate what is this very essential mitigation measure.
    And so there are a number of things that could happen if 
that is not done right, including you could have the stream of 
petroleum that is coming up essentially form hydrates if 
seawater is allowed to go in there. So it is a very delicate 
process, and that is why they are taking their time to wrap it 
up by adjusting the pressures generally about every 2 hours, 
which then increases the flow.
    When they will get to maximum containment under this 
mitigation flow regime, I still don't know. I asked exactly the 
same very question of Andy Inglis, who is the executive at BP 
in charge of the whole operation this morning, and we still 
don't know. But there will be a lot more information I would 
expect over the next couple of days.
    Senator Vitter. OK. Just to clarify, part of my question is 
a little different, even though we are not at maximum capture 
right now, and I will wrap up. Even though we are not at 
maximum product capture right now I would have thought 
connecting the pipe would give us a much better guesstimate of 
the flow even now. Is it not doing that?
    Mr. Salazar. I wasn't sure of the timing of the video that 
was shown here, but there is still product that is escaping. It 
is not controlling 100 percent of the leak, nor will it at the 
end. But as the process ramps up to a higher level of 
production, it will give us a much better sense of the numbers.
    What I will say, Senator Vitter, and to all the members of 
this Committee, is that you have the best engineering and 
science minds of the entire globe that are focused in on this 
problem. It includes the leadership of Secretary Chu and the 
Department of Energy and the National Labs and the Department 
of Commerce and NOAA and USGS.
    Dr. Marcia McNutt, who I think is one of the most renowned 
ocean marine scientists in the world, has actually been at 
Houston watching exactly what is going on. It is part of 
pulling together a group of the leadership of the scientific 
community to help address some of these issues which you are 
raising.
    Senator Vitter. Thank you.
    Senator Whitehouse. Senator Baucus.

             OPENING STATEMENT OF HON. MAX BAUCUS, 
             U.S. SENATOR FROM THE STATE OF MONTANA

    Senator Baucus. Thank you, Mr. Chairman.
    Today we are gathered for one reason, and that is we need 
to answers to the question what went wrong. Eleven people lost 
their lives. Oil is gushing into the Gulf of Mexico. The Gulf 
Coast economies are at risk. Environmental damage will be 
severe.
    I have supported offshore oil and gas development for many 
years, and I expect to continue to do so. But with that support 
comes responsibility to ensure that people are safe, our 
communities are protected, and our natural resources preserved.
    The catastrophic consequences of this incident compel us to 
pause, to evaluate what happened, and to make corrections so 
this does not happen again.
    A few key questions come to mind. First, the response. Have 
appropriate actions been taken, and are they continuing to stop 
the spill and mitigate the damage to the environment and the 
economy?
    Second, the cause. What exactly happened? Was this human 
error, equipment failure, or both? Was there failure to plan 
for the worst case scenario? Were appropriate environmental 
reviews conducted? Were adequate preparations made for rapid 
response in the event of an incident?
    Third, are there systemic changes we need to make to be 
sure this never happens again? Is there an appropriate level of 
redundancy in the safety systems on these offshore rigs, given 
the potential for damage? Are the Federal safety environmental 
requirements for offshore drilling adequate, and are they being 
followed?
    One item I would like to highlight on this last point. I 
understand that under current regulations a full environmental 
assessment may be avoided at a particular site unless a project 
has the potential to harm things like ``parks, recreation or 
refuge lands and wetlands.''
    In Montana these words have very clear meaning that brings 
to mind places like the North Fork of the Flathead River, 
Glacier National Park in northwestern Montana. We have higher 
expectations for these lands already in protected status. Given 
the nature of the resources in the Gulf, I cannot understand 
why a more detailed environmental review was not conducted that 
might have led to extra precautions.
    The true impact of this ever growing disaster on the people 
of the Gulf Coast, the economy, and our Nation's natural 
resources will emerge over time. It is our responsibility to 
make sure that as we move forward with offshore oil and gas 
developments we are doing so with the utmost care to preclude 
this type of catastrophe.
    I very much look forward to a hearing from the Committee. 
We have a long ways to go yet in order to get to the bottom of 
this.
    Mr. Secretary, I have a question for you. We are both from 
the West. When we see the words park, wilderness areas, or 
wildlife refuge, we know what they mean. They mean places like 
Glacier National Park or the North Fork of the Flathead River 
which you and I visited last year.
    These words also mean the six refuges in the Gulf or the 
Florida Keys National Marine Sanctuary. When these resources 
are present MMS regulations require environmental assessments 
that preclude the use of a categoric exclusion to avoid 
environmental review. With the Deepwater Horizon case exactly 
the opposite occurred. Why then was a categorical exclusion 
used at this site, and what is MMS doing to ensure that our 
most special places are protected?
    Mr. Salazar. Senator, Chairman Baucus, let me just say 
first, as I alluded to earlier in the testimony, the response 
here has been robust. The President has directed us to make 
sure that we do not rest until we get this problem solved. To 
the cause, the Commission, especially the Presidential 
Commission will get us down to the root causes of what happened 
here and will answer the question that you had in your opening 
comment.
    Systemic changes, some of those we will move forward with, 
and we have moved forward with some of those over the last 
year, and we will continue to move forward with them now. But 
also as the lessons learned emerge, we will be moving forward 
with additional systemic changes.
    On the EISs and what happened here relative to the refuges, 
I will have Nancy Sutley comment, if she will in just a minute, 
on the environmental reviews that do happen. But I will say 
this--there are 40 units of very spectacular areas in the 
entire Gulf Coast. They include 33 National Wildlife Refuges 
and seven units of the National Park System. That is an agenda 
of protection that I take as seriously as I do Glacier National 
Park.
    We will, as we investigate what happened here, make sure 
that we understand whether or not there were shortcuts that 
were taken that should not have been taken. I think on the 
environmental categorical exclusion on the exploration plan 
itself, there is, as I have understood it, a 30-day mandate 
under our national framework for approval of those plans. And 
so that is what has driven a number of the categorical 
exclusions that have been given over time in the Gulf.
    But Director Sutley actually is very eloquent on this 
subject, so she should probably respond to that specific one.
    Senator Baucus. So there is the question, why was the 
categorical exclusion provided for in this case given the 
sensitivity of the area? Well, that is the basic question, 
which would preclude a deeper environmental assessment.
    Ms. Sutley. Thank you, Senator. We know something needs to 
be done here. We have announced with the Department of Interior 
a review of the environmental review process at MMS so we can 
get answers to exactly those questions.
    We will also propose to strengthen the guidance that we 
give to agencies with respect to their use of categorical 
exclusions, clarifying when they should use them, requiring 
them to review them, requiring CEQ to review the use of 
categorical exclusions.
    But as the Secretary alluded to, one of the real 
constraints that MMS faces is this 30-day requirement to act on 
permits within 30 days. And so in the legislation that we sent 
up here last week, we have asked to extend that to 90 days to 
ensure that there is adequate time to do a thorough 
environmental analysis when it is required.
    Senator Baucus. What is the 30 days? Is that a statutory 
requirement?
    Ms. Sutley. My understanding is that it is.
    Mr. Salazar. It is a statutory requirement that I 
understand has been in place since 1978 that MMS has to respond 
with a decision on an exploration plan within 30 days from its 
submission.
    Senator Baucus. But that doesn't necessarily mean that it 
has to be, maybe it does, a categorical exclusion, does it?
    Mr. Salazar. There are a number of environmental reviews 
that take place before you get to the point of actually 
granting a permit to drill a particular well. They include the 
very extensive environmental impact statements in preparing an 
Outer Continental Shelf plan. They include another 
environmental impact statement with respect to a particular 
lease sale. And then additional environmental analysis that 
occurs.
    At the point in the window of this process where the 
company submits an exploration plan, there is a requirement, as 
I understand it, that says that the exploration plan must be 
approved or disapproved within 30 days.
    We have asked for that to be changed in the submission by 
the President on legislative changes. There will be other 
things like that that will be looked at. But I think, Chairman 
Baucus, if I may, the most important thing that is going on 
here is that it is time to learn from this tragedy. Director 
Sutley, along with our Department, along with Administrator 
Jackson and others, will take a look at these environmental 
reviews, and whatever changes need to be made, they will be 
made.
    Senator Baucus. I understand that. It sort of baffles me, 
frankly, that based on what I know at this point. There does 
not seem to be redundancy plans. There does not seem to be 
testing, particularly a mile down, of some of these procedures, 
like the preventer, at that depth.
    And just lots of questions that come to my mind. I am just 
curious. It just seems that they were not looked at adequately 
in advance. I know this is hindsight, but it is baffling to me 
the degree to which there is almost a cavalier attitude by the 
Government in its failure to protect resources here.
    If I might change subjects here, my time is about to 
expire.
    Administrator Jackson, thanks for all the work that you do. 
As you recall I wrote you a letter recently regarding clean up 
at Libby, Montana. And I asked you to affirm a series of 
commitments related to public involvement in the cleanup 
process and updating records of decisions upon completion of a 
risk assessment. I just wondered if you could confirm that EPA 
will take the actions outlined in my letter by May 12 of this 
year.
    Ms. Jackson. Yes, your letter was dated May 12, Senator, 
and I do have it and I am happy to affirm those commitments 
that staff have made and will also get you a written response 
to your letter.
    Senator Baucus. I thank you. And just while we are here, I 
also want to just thank you and Secretary Sebelius and the 
Administration for the declaration of public health urgency. It 
has made a huge difference to those people in that part of our 
State. So I just want to thank you on their behalf.
    Ms. Jackson. And I am still looking to visit with you.
    Senator Baucus. Good. Thank you.
    Thanks, Mr. Chairman.
    Senator Whitehouse. Thank you, Chairman.
    Senator Carper.
    Senator Carper. It is always nice to see you. Thank you for 
coming today. Thank you for bringing with you Secretary Salazar 
and Administrator Jackson. We miss one of you very much here in 
the U.S. Senate. It is nice that you come back from time to 
time and still try to play a constructive role at reaching out 
to all sides and working through these difficult issues.
    My first question is for our old colleague, Secretary 
Salazar. First of all, let me say, this question could be for 
any of you.
    A week or so ago we had a number of witnesses from the 
industry. I think from the folks from BP and the other 
witnesses from the industry side. And one of the questions I 
asked to our senior witness from BP was about their willingness 
to really pay the piper, for their willingness to cover the 
costs that were being incurred.
    I believe under current law they have a $75 million 
obligation beyond which they can ask that we tap this fund that 
is now grown to about $1.7 billion. I think under current law, 
as I understand it, about $1 billion of that can be used per 
incident. I think there has been a proposal to lift that $1 
billion to $1.5 billion.
    The witness from BP, again a very senior member of their 
team, responded that they had no interest or intention to 
foisting any of this obligation off onto the taxpayers. This 
was something they wanted to pay for with their dime beyond the 
$75 million they are good for. I even understood him to say 
they weren't interested in taking money out of the $1.7 billion 
trust fund.
    We have asked GAO to look at this to make sure that what we 
are hearing from the witness and witnesses from BP actually is 
credible.
    Let me just ask, what have you been told by BP or other 
liable parties in terms of picking up the tab, making sure we 
make whole those who need to be made whole without putting the 
taxpayers on the hook?
    Mr. Salazar. Senator Carper, thank you for your hard work 
in the U.S. Senate on behalf of Delaware and the country.
    Let me just say that we have had multiple meetings with the 
senior executives of BP, including Tony Hayward, on the issue 
of liability and what they will pay for. It has included 
meetings with Secretary Napolitano and me, Director Browner of 
the White House, and others. They have communicated to us, 
first orally, that was in fact the case that they were going to 
pay for all of the consequences of this incident, including 
damages and compensation for businesses and people who will be 
affected.
    We asked them to put that in writing in a letter that 
Secretary Napolitano and I sent to BP. They have done so, and 
it comports with the statement, as you have understood it, that 
they are not going to access the oil spill fund, nor will they 
take advantage of the $75 million liability cap that is in the 
statute right now.
    Senator Carper. Great. Thank you.
    Ms. Jackson, do you or Ms. Sutley have a different view? 
Feel free to speak.
    I see you don't. That is good.
    A question, if I could, for our Administrator, Lisa 
Jackson. We know that the impacts of this oil spill on our 
ocean and our ecosystem may well be devastating. We hope not, 
but they may well be. As Chairman of the Subcommittee on Clean 
Air and Nuclear Safety here in the Senate, I am also concerned 
about the impact on air quality that may emanate from this 
spill.
    My question is: Has EPA found thus far that the spill is 
causing impairments in air quality? And second, what is EPA 
doing to protect workers who are cleaning up this spill from 
breathing harmful air?
    Ms. Jackson. EPA has been sampling since fairly early on. 
It was actually the day that BP started the in situ burning of 
the oil that was on the surface that EPA began air sampling. We 
have gotten more robust over time. I aspire that we will 
continue to improve.
    We have made a second commitment, which is anything that we 
sample, any sampling results we get, we will put them up on our 
Web site. We have been doing that, although admittedly I wish 
we could do it faster, but we think data integrity is very 
important.
    Here is the basics of what we know. So far, we can get 
quicker data when we look at big indicators, total particulate 
matter, which is important when you are looking at a fire. We 
haven't seen elevations in those levels into zones that would 
be a problem for public health. That is based on sampling that 
we do on the shoreline as well as near the incident.
    We look at total volatile organics, because that would be 
the stuff that would be likely to volatilize into the air. 
There have been numerous reports of odors, some reports of 
irritation. What we found is that while total VOC levels are 
within levels that we would consider to be protective of human 
health, we have not yet reviewed individual volatile organic 
contaminant data. We need about 2 weeks' worth of data for the 
scientists to be able to speak with any clarity on that issue.
    I think it is probably due to a large extent to the sheen 
and the wave action in a pretty active Gulf that from very 
early on there was some supposition that there could be an 
aerosol forming. As you know, an aerosol can be very 
irritating, at the least, to your lungs. If you ever spray a 
can, and then try to walk through it, that can really irritate 
you. We have seen incidents like that.
    We have also measured for hydrogen sulfide, and we have 
seen some hits, but we have seen them only at certain monitors. 
So when you monitor along the shoreline, you may see them one 
place but not another. So that leads us to wonder whether it is 
related directly to the spill or perhaps some other issues in 
the marsh. They haven't been particularly high levels, but they 
are certainly higher than, if you will, background.
    So there is a lot more data coming in. We have a plane in 
the air. We have two mobile labs out front. But I am trying to 
be very careful not to overstate what we know, but my 
commitment has been to people when I talk to them that we are 
going to get the data, and we are going to give it to you. And 
we are going to give it to you in a way that is responsible and 
hopefully that will add to the knowledge of what we are 
learning about this spill.
    Senator Carper. Thank you. It sounds like you are on it. As 
a Vietnam veteran, I remember all too well the exposure not 
just to folks in Vietnam, but to our military personnel, the 
exposure to Agent Orange and the unanticipated consequence of 
health damages really to both groups. I think we are all more 
recently mindful of the exposure of the men and women who were 
involved in the clean up and searching for survivors in the 
ruins of the Twin Towers on 9/11 and the health impairments 
that a number of them have. Let's just keep that in mind. It 
sounds like you are as we go forward.
    Ms. Jackson. Thank you, Senator. You did ask about workers, 
and of course that is a Department of Labor, Occupational 
Safety and Health, OSHA. We all know OSHA. We have heard from 
several people their concerns, though, and OSHA has really 
stepped up their presence down in the area of the paid 
volunteers, if you will, the fishermen and vessels of 
opportunity that have been pressed into service on boom.
    I know the other concern has been whether the dispersants, 
which are applied aerially, are any concern. We have added now 
to our suite of chemicals looking for those constituents in the 
dispersants that are most likely to be volatile, recognizing 
that they are not particularly volatile mixtures to start with.
    So we will have some information.
    Senator Carper. Thanks.
    And one last question for Mr. Secretary, if I could. Last 
week, you announced your intention to restructure MMS in order 
to establish a separate and independent safety environmental 
enforcement entity for oil drilling. I believe currently that 
the Minerals Management Service collects energy revenues on 
behalf of American taxpayers and enforces laws and regulations 
that apply to offshore energy operations. Is that a basically 
correct division of labor?
    Mr. Salazar. Yes.
    Senator Carper. OK. My understanding is that MMS is already 
partially separated. The Royalties Division is mainly in 
Denver, and the Regulatory Division, I am told, is mainly in 
New Orleans. Is that correct?
    Mr. Salazar. That is generally correct.
    Senator Carper. OK. How do you see your reorganization 
changing the status quo? Have you thought that far down the 
road?
    Mr. Salazar. Senator Carper, the reform effort that we have 
had underway throughout the Department has included MMS from 
day one, and that has included the elimination of programs like 
the Royalty-in-Kind Program, the institution of a new ethics 
code, investigations that ultimately have been referred over to 
the U.S. Attorney, a number of different things like that that 
have been an effort on our part to bring competence and trust 
in the functioning of MMS.
    Our work is not yet finished. In the days ahead there will 
be additional orders that we will issue with respect to the 
restructuring of MMS.
    Senator Carper. OK.
    Mr. Chairman, I know my time has expired. Something you and 
I are very much interested in is alternative energy. If I could 
just ask one last quick follow up on the same point with 
Secretary Salazar. Where do you see the alternative energy 
permitting folks ending up in this reorganization? Have you 
thought that far down the line?
    Mr. Salazar. We have indeed. There will be a continuing 
significant effort on our part to capture energy in the ocean 
that is renewable energy. As you well know, the State of 
Delaware, along with the State of Rhode Island, are two of the 
key leaders in the Atlantic. We have formed an Atlantic 
Consortium with respect to offshore wind. We have developed the 
regulations with respect to that.
    I expect that even in the weeks ahead, even as we deal with 
this turmoil down in the Gulf, you will be seeing additional 
information with respect to the efforts on the offshore wind 
related specifically to the Atlantic.
    Senator Carper. All right. Thanks so much.
    Thanks, Mr. Chairman.
    Senator Whitehouse. Thank you, Senator Carper.
    And thank you to all the witnesses for being here. We are 
down to the bitter end of your time here. I wanted to ask a 
number of questions. The first has to do with a statement made 
by Transocean's lawyers, who have said that strengthened 
regulations are not needed because companies have the financial 
incentive to do this kind of job right.
    That is the Greenspan rule. That is exactly the theory that 
Alan Greenspan used to justify deregulation of the financial 
regulatory structure that we had. We saw the destruction that 
ensued from that. Please assure me that you are not buying into 
this theory that under certain circumstances there may be a 
financial disincentive to a company from having a disaster 
means that the Government doesn't need to do any regulation to 
prevent that disaster from happening.
    Mr. Salazar. Senator Whitehouse, I very much agree with 
your position, and I think that kind of a statement from 
Transocean is wrong.
    Senator Whitehouse. I appreciate it.
    In terms of MMS's role, I have seen news reports saying 
that they were highly encouraging companies to take certain 
steps, but not requiring them to; that they issue guidelines 
and recommendations but that their provisions weren't 
mandatory. If a regular American is trying to electric work on 
their house, and they need to have the electrical inspector 
come and sign off on what they did or didn't do, they are 
subject to pretty clear requirements. You have either done it 
right, or you haven't.
    Why is it that for something that is so complicated and so 
dangerous as this offshore drilling that the similar level of 
mandatoriness that you and I have to face with the electrical 
inspector in our homes doesn't apply to these giant industries? 
What is with regulation by suggestion?
    Mr. Salazar. Senator Whitehouse, the MMS has a 
comprehensive regulatory program that has been in place and is 
the creature of 40 years of development. It is under that 
regime that some 36,000 wells in the Gulf alone have been 
constructed without this kind of an incident. Many of the rules 
at MMS are in fact mandatory.
    Now, that doesn't mean that these rules are what they ought 
to be. I would imagine that one of the things that you will see 
in the coming report to the President on safety issues has to 
do with significant enhancements.
    I have seen the blowout prevention mechanisms. They are 
required on wells. They are not the first line of defense. 
There are other lines of defense. It is first the mud in the 
well, and that is never supposed to happen, and there are a 
whole bunch of shutoffs with respect to blowout preventions. 
This particular BOP program had a number of different closures 
that were supposed to take place. Lots of things probably 
happened that kept them from closing in and stopping the flow.
    We will learn a lot from what happened here, and that is 
why the President's Commission and the investigations are so 
important so we can get to the root causes and so that we can 
learn all the lessons that can be learned from this horrible 
tragedy.
    Senator Whitehouse. I appreciate that. I am delighted that 
the President made that decision. As you know, Congresswoman 
Capps on the House side and me on the Senate side have filed 
legislation to push that to happen. I think the President's 
choice obviously was the right one.
    In terms of the culture at MMS, we have seen horrifying 
stories. We have seen regulation by suggestion, I call it. I 
haven't seen that in any other regulatory environment I have 
ever been in. On the other hand, it is a big organization. You 
see it, although only for a brief period of time now, more 
closely than I do. To what extent is this a captive regulator 
where, to use your earlier phrase, really root and branch 
changes need to be made? And to what extent is this a 
legitimate, honest regulator that has only pockets of 
malfeasance or nonfeasance? What is your view of the scope of 
the problem within MMS?
    Mr. Salazar. Let me say first there are 1,700 employees at 
MMS, and today I would say most of them, the very, very vast 
majority of them, are good public servants doing their job, 
collecting $13 billion for the taxpayers of America; helping 
produce the energy which you and I consume and the constituents 
of Rhode Island and Colorado consume every day.
    So I am proud of the work that they do, but I also 
recognize that there are pockets of problems, and we have taken 
them on, including with appropriate personnel actions, and 
whenever necessary, referrals for other more significant 
sanctions under the law. That has continued and will continue 
unabated into the future.
    Senator Whitehouse. Do you think an adequate spirit of 
skepticism about the assertions of the industry it is intended 
to regulate exist within the agency? Or do you think they are 
willing to more or less take what they are told?
    Mr. Salazar. Senator Whitehouse, the reform agenda which we 
have tried to put into the Department of the Interior has not 
come without any cost. There was an exchange between myself and 
industry where I said the days of them treating the Federal 
domain as essentially part of a candy store were over. We have 
made it clear that those days of the prior Administration are 
over.
    So those changes are changes that we have implemented from 
the very beginning of my coming into the Department of the 
Interior. It has come at the cost of significant criticism, 
including members of this Committee and the Senate. But it is 
the right agenda that we are on, the agenda of reform. It is an 
agenda which is not yet complete, and that is why we will not 
rest until we get it done and we achieve the President's goal 
of having the highest safety possible with respect to any 
development in the Outer Continental Shelf.
    Senator Whitehouse. If you look for a minute at the 
categorical exclusion question, which I know has been touched 
on a few times already, under the 2004 changes to your NEPA 
manual, National Environmental Protection Act manual, the 
categorical exclusion from the full blown NEPA process for 
approval of an offshore lease or unit exploration in the 
central or western Gulf of Mexico provides a number of 
exemptions: No. 1, in areas of high seismic risk or seismicity, 
relatively untested deep water, or remote areas; two, within 
the boundary or near the boundary of a proposed or established 
wildlife refuge or area of high biological sensitivity; three, 
in areas of hazardous natural bottom conditions. I don't know 
if the natural bottom conditions were there; four, utilizing 
new or unusual technology.
    The press is full of reports about the novelty of using 
this technology at this depth; the use for the first time of 
nitrogen cement instead of regular cement; the use of the 
device of displacement of the mud before the plugs were in; and 
obviously they went into a scramble mode once things really 
went wrong and they had to begin to try to address the spill 
because clearly it was being made up as they went along at that 
point: trying the dome, no; ice crystals, that didn't work; 
what are going to do next, try the straw, no; well, I guess 
that is working; maybe we will try the relief wells.
    It looks like a very ad hoc effort. And when I look at 
these exemptions from the requirement, here we were in very 
deep water. I don't know how near we were to the boundaries of 
a wildlife refuge or areas of high biological sensitivity, but 
clearly there would seem to be elements of new and unusual 
technology being used here, particularly at this depth.
    Do you feel that the decision that was made to go ahead 
with the categorical exclusion, when these exemptions seem to 
me rather plainly to apply, was taken correctly and in good 
faith?
    Mr. Salazar. Senator Whitehouse, there has been significant 
environmental review, including environmental impact statements 
that have been conducted with respect to this activity in the 
Gulf of Mexico. It is an area where we know a lot about the 
environment. We know a lot about the infrastructure that is 
there.
    The question of the categorical exclusions in part relates 
to the congressionally mandated 30-day requirement that MMS has 
to approve or disapprove an exploration plan. But it is an 
appropriate area for questions, and that is why Director Sutley 
and Interior are leading a review of all these environmental 
issues. I would, with your indulgence, ask her to comment on 
the review of all these environmental issues at MMS.
    Senator Whitehouse. I would be delighted. Just to sort of 
provoke the conversation a little further, here is BP's Chief 
Executive Officer, Tony Hayward, saying this is the first time 
the industry has had to confront this issue in this water 
depth, and there is a lot of real-time learning going on; BP's 
release that the Chairman showed earlier, that significant 
uncertainties exist because they have not been tested in these 
conditions before; and now you have a new or unusual technology 
exemption to the categorical exclusion, and everybody is 
running around saying his is new, this is unusual.
    Why was that not apparent back when the categorical 
exclusion was being issued?
    Mr. Salazar. Let me just say, Senator Whitehouse, those are 
from 2004. That was a long time ago, a different 
Administration. We are taking a new look at that. We have been 
taking a new look at a lot of different things. But 
importantly, the effort that Director Sutley and I have 
underway to look at all these environmental issues is very 
important. So I think it would be appropriate for her to 
comment.
    Senator Whitehouse. No, and I don't mean to suggest that 
any of you three individually had any responsibility for that. 
I mean, if these technologies are new and unusual now, think 
how new and unusual they were years ago when this application 
was being considered. There is the new and unusual exemption 
right in the middle. There is the deep water exemption right in 
the middle of it. Who was watching to oversee that 
determination?
    It is hard for me to see that that is a determination that 
could have been made in good faith back then. So I hope you 
will look back and take a look at the extent to which there 
might have been improper or undue influence in the early stages 
of this approval to allow this to go through the categorical 
exclusion, given those very clear exemptions that seem to be 
plainly pertinent.
    Chairman Sutley.
    Ms. Sutley. Thank you, Senator. The Secretary is exactly 
right. We intend to do something about this. We are engaged in 
this review of MMS's NEPA procedures and their environmental 
review procedures, recognizing that there is an expanding use 
of categorical exclusions across the Government. We proposed in 
February to update our guidance with respect to categorical 
exclusions, including the requirement that agencies review 
their own use of categorical exclusions and that CEQ will do, 
as we are launching with the Department of Interior review not 
only MMS's overall NEPA procedures, but the use of categorical 
exclusions. So we think there are definitely areas for 
improvement in the application of categorical exclusions.
    Senator Whitehouse. OK. I appreciate that.
    My time has expired, and even though I am not 
inconveniencing any other Senators, because we are here now 
alone, I am inconveniencing the three of you, so I will 
conclude. But I am glad that you are taking such a serious look 
at it. Just from what I have seen in the newspapers, we read 
about dead batteries in the control pod; test parts in the 
blowout preventer instead of the reel rams; even the reel rams 
not able to actually shear the pipe the way they are supposed 
to at joints; hydraulic leaks that preexisted all of this; 
pressure readings that were missed.
    And on the Government side, inspections missed, warnings 
ignored, regulation by recommendation, I call it. I don't envy 
you having to go back and clean this up. I know the problems 
predated your arrival, but I really think it is important that 
you do that. I would urge you to take a particular look at what 
this means for Arctic drilling. Because if it is this hard to 
clean this up in the relatively benign conditions of the Gulf 
of Mexico, good luck trying to implement this sort of a clean 
up in Arctic oceans.
    Thank you all very much for being here. I appreciate your 
testimony and will take a 2-minute recess to allow the second 
panel to come forward. I am very grateful for your service. I 
know you have put in enormously long hours and put in a 
wonderful effort on this.
    Secretary Salazar, as a former colleague of yours here, I 
am just always very proud of you. So keep up the good work. 
Thank you.
    Mr. Salazar. Thank you very much, Mr. Chairman.
    [Recess.]
    Senator Whitehouse. The hearing will come back to order.
    I am delighted to welcome panel two. In addition to being 
very distinguished, they are also very patient. I think I will 
read everybody's introductions, and then we will go through the 
statements one after another.
    Admiral Peter F. Neffenger of the United States Coast Guard 
is the Deputy National Incident Commander for the Deepwater 
Horizon oil spill response. The Coast Guard is responsible for 
the response and clean up of oil spills in coastal waters under 
the Clean Water Act, Oil Pollution Act and the National 
Contingency Plan. The Coast Guard is also a co-lead, along with 
the Minerals Management Service, in the ongoing investigation 
into the causes of the explosion and spill.
    Jo-Ellen Darcy is Assistant Secretary of the Army for Civil 
Works. The U.S. Army Corps of Engineers, which Ms. Darcy 
oversees, is responsible for maintaining navigation on the 
river systems and waterways along the Gulf Coast, some of which 
could be affected by the spill. The Corps will also have 
responsibility for reviewing Louisiana's proposal to construct 
barrier islands in coastal waters to prevent the oil spill from 
reaching coastal wetlands.
    John Fernandez is the Assistant Secretary of Commerce for 
Economic Development. The Economic Development Administration, 
which he oversees, will play a role in assisting Gulf Coast 
communities in coping with impacts to local economies as a 
result of the oil spill. The EDA has a proven track record in 
helping communities recover after disasters, and we look 
forward to hearing how EDA can assist in the wake of this 
spill.
    I will call first on Admiral Neffenger. Let me just tell 
you how grateful I am for the work that the Coast Guard has 
done in this particular instance. I think both as active 
participants in the response and as regulators and questioners 
of other agencies has been in the best traditions of the Coast 
Guard. I, for one, remember the North Cape-Scandia incident off 
of Rhode Island and the extraordinary heroism of the Coast 
Guard folks who made very hazardous rescues that night and 
brought everyone to safety in really appalling weather 
conditions. So I just wanted to take that moment to thank you 
for what an impressive and professional organization you are a 
part of.
    Admiral.

STATEMENT OF PETER V. NEFFENGER, REAR ADMIRAL, DEPUTY NATIONAL 
INCIDENT COMMANDER, DEEPWATER HORIZON OIL SPILL RESPONSE, U.S. 
                          COAST GUARD

    Admiral Neffenger. Thank you, Mr. Chairman, and thank you 
for those kind comments about the men and women of the Coast 
Guard. And thank you for the opportunity to testify today about 
the ongoing response and investigation into the explosion and 
subsequent oil spill from the Deepwater Horizon incident.
    I have written comments that I will provide for the record 
and make a brief opening statement.
    On the evening of April 20, 2010, the Coast Guard and other 
mariners immediately responded to the explosion and fire which 
engulfed the Deepwater Horizon. Within the first few hours, 115 
of the 126 crewmembers aboard the rig were rescued, with the 
Coast Guard medically evacuating 17 of those most seriously 
injured. Eleven crew members remain missing despite intensive 
multi-day search efforts, and our deepest sympathies remain 
with their families and friends as they cope with their losses.
    On the morning of April 22rd the Deepwater Horizon sank in 
5,000 feet of water, resulting in a major oil spill from the 
continuous release of oil and gas from an open wellhead riser 
and drill pipe. The complexity of this event is unprecedented. 
With the spill emanating at a depth of 5,000 feet of water we 
are operating in inner-space where there is no human access, 
and we must depend upon remotely operated vehicles and tools 
with which extensive efforts continue to stem the flow and 
secure the source of the spill.
    To meet this challenge, organizations at the local, 
regional and national level immediately initiated a massive 
response. This has been led regionally by the Federal on-scene 
coordinator, Rear Admiral Mary Landry, nationally by Admiral 
Thad Allen, to whom I am the Deputy National Incident 
Commander, and Secretary Napolitano as the principal Federal 
official under the authority given her by HSPD-5.
    On the day the rig sank the President convened a principals 
meeting to direct that the whole of Government be brought to 
bear on this effort, working closely with State and local 
government authorities. The National Contingency Plan provides 
the organizational structure and the operational framework to 
implement the family of response plans that are developed and 
exercised in advance of a spill such as this.
    Unified commands consisting of Federal, State and local 
authorities, the responsible party, and oil spill removal 
organizations and other key stakeholders were established 
within the Gulf region to coordinate and direct the response 
operations. These unified commands implement the area 
contingency plans, which include response strategies and 
organizational responsibilities previously agreed upon by 
stakeholders for the anticipated most probable and worst case 
oil spills.
    These plans prioritize cleanup sites and protection areas 
for booming and pre-staging of other resources. The projections 
of spill trajectory based on forecasted winds, currents, and 
sea states require continued tactical flexibility as we move 
stocks and booms around and such and direct resources 
accordingly.
    BP is the responsible party, and it is their responsibility 
to plan for and to respond with sufficient capability. They are 
also responsible for the clean up of the oil, remediation of 
all damages, and the restoration of impacted natural resources. 
They have acknowledged and accepted this responsibility, but as 
the Federal on-scene coordinator the Coast Guard is ensuring 
that they continue to meet their obligations by providing 
constant oversight and direction of their actions.
    In addition, we continue to monitor the claims process to 
ensure it is robust and fair.
    The severity, size and location, and potential impact of 
this brought Secretary Napolitano to declare it a spill of 
national significance. As part of that designation, Admiral 
Thad Allen, as I said, was named the National Incident 
Commander. The role of the National Incident Commander is to 
coordinate national policy, ensure provision of necessary 
resources, facilitate collaboration between Federal, State and 
local government, and coordinate strategic communications 
throughout the whole of government.
    The magnitude and location of the spill has required a 
combination of traditional spill response equipment and 
methodologies coupled with newer technologies employed in 
unconventional ways. The use of dispersant deep below the 
surface, remote operating vehicles to access the site and 
secure the source, and satellite imagery to better determine 
the location of oil are just a few examples of these.
    The efforts so far have been extensive and without 
precedent. As of today, we have recovered over 7.6 million 
gallons of oil-water mix, applied over 588,000 gallons of 
surface dispersant and over 47,000 gallons of sub-sea 
dispersants, deployed over 1.3 million feet of boom, staged 
over 350,000 feet of boom, and have another 1.4 million feet 
arriving. And as noted there are over 19,000 personnel and 950 
vessels involved.
    We understand the impacts of this spill on the local 
communities whose livelihood and quality of life depends on the 
health of the Gulf. I have personally spent the better part of 
the past few weeks in the Gulf region over-flying the spill 
site, visiting the various command posts, and observing first-
hand the efforts underway.
    In closing, the National Incident Command will continuing 
coordinating the aggressive whole of government response to 
this spill while ensuring that BP meets their obligations.
    Mr. Chairman, thank you for the opportunity, and I welcome 
any questions you may have.
    [The prepared statement of Admiral Neffenger follows:]
    
    
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    Senator Whitehouse. Thank you, Admiral.
    We will hold questions until the end, and we will go to 
Assistant Secretary Darcy.

 STATEMENT OF HON. JO-ELLEN DARCY, ASSISTANT SECRETARY OF THE 
                       ARMY (CIVIL WORKS)

    Ms. Darcy. Thank you, Senator Whitehouse. I want to thank 
you for the opportunity to be here today to discuss the Army's 
ongoing efforts to support the oil spill response in the Gulf 
and to provide an assessment of impacts to navigation and the 
ecosystem.
    In the midst of the response to this tragic Deepwater 
Horizon oil spill, the Corps of Engineers continues to provide 
reliable navigation on the river system and waterways along the 
Gulf Coast.
    In addition, the Corps has provided modeling support for 
river discharges and is offering emergency review under section 
404 and section 10 authorities of a proposed barrier plan 
developed at the local level intended to prevent the oil from 
reaching the coastal wetlands.
    Currently the oil spill is not affecting dredging 
operations or navigation in any rivers or waterways along the 
Gulf. So far there have been no incidents of deep-draft vessels 
getting oil on their hulls as they approach the southwest pass 
of the Mississippi River.
    The U.S. Coast Guard, working with navigation interests, 
has established a clearing station in the Lower Mississippi 
River to clean those vessels before they proceed up the river 
to New Orleans. This is similar to what was done in the 
Mississippi River in the 2009 oil spill.
    The Corps continues daily monitoring of any impacts to 
navigation and dredging operations as a result of the oil spill 
and maintains continued coordination with navigation interests 
and appropriate agencies.
    The Corps' New Orleans District, Mississippi Valley 
Division, and the Engineer Research and Development Center 
Coastal and Hydraulic Laboratory have analyzed a number of 
water management conditions and possible actions to determine 
whether we could modify river flows to keep oil away from the 
mouth of the Mississippi River and wetlands on either side of 
the river.
    This analysis included the possible deviations from what is 
currently a 70-30 split at what is called the old river control 
structure between the Mississippi River and the Atchafalaya 
Basin. Numerical modeling analysis has shown that diverting 
water from the Atchafalaya Basin to the Mississippi River at 
this control structure would have minimal influence on the 
movement of the oil in the Mississippi River Delta region.
    Due to the extreme flooding of the Tennessee and the 
Cumberland Basins earlier this month, Mississippi River 
discharges below New Orleans will nearly double. However, even 
with these forecasted increases in discharges, we do not 
anticipate increased flows that would allow opening the Bonnet 
Carre spillway to reduce oil entering the Mississippi Sound 
area.
    With respect to some of our smaller freshwater diversion 
structures, those structures are currently operating near 
design capacity, and the modeling suggests that this may help 
slow the movement of the oil into the project marshes from the 
marsh and the open water boundaries in the immediate vicinity 
of these structures.
    This team continues to evaluate other water management 
scenarios to determine if they will help address the oil spill 
issues. The Corps of Engineers' Research and Development 
Center, which we refer to as ERDC, is also working with the 
U.S. Geological Survey Program to collect and analyze baseline 
sediment samples in the wetlands and in the navigation areas. 
These pre-oil spill samples will provide critical comparisons 
to post-emergency sediment that will be required for efforts to 
continue with Louisiana coastal restoration through the 
beneficial uses of dredge materials.
    On May 11, 2010, the Corps received a permit request from 
the State of Louisiana for construction of an approximately 
100-mile-long barrier intended to intercept the oil before it 
enters the marshes. The Corps is reviewing the permit request 
under section 404 of the Clean Water Act and section 10 of the 
Rivers and Harbors Act.
    As this request was rendered in the context of the British 
Petroleum oil spill, the Corps is working with the National 
Incident Commander to evaluate this request.
    In addition to ERDC's Coastal and Hydraulic Laboratory 
support, seven people have been deployed from ERDC 
Environmental Laboratory to support the U.S. Fish and Wildlife 
Service's natural resources damage assessment activities. 
Activities include development of bird injury study plans, 
global positioning systems collection, and integration of field 
data, as well as primary GIS and mapping support.
    As the Department of Army lead for environmental 
restoration, research and development, ERDC is prepared to 
assist in formulating and implementing strategies for long-term 
monitoring and remediation of wetland and barrier island areas 
affected by the oil spill.
    ERDC is also prepared to provide analysis for the eventual 
remediation of contaminated barrier sediment and material 
removal and ecological restoration.
    Thank you, Senator Whitehouse, and I am happy to answer any 
questions.
    [The prepared statement of Ms. Darcy follows:]
    
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    Senator Whitehouse. Thank you, Assistant Secretary Darcy.
    Assistant Secretary Fernandez, welcome.

   STATEMENT OF HON. JOHN FERNANDEZ, ASSISTANT SECRETARY OF 
    COMMERCE FOR ECONOMIC DEVELOPMENT, ECONOMIC DEVELOPMENT 
                         ADMINISTRATION

    Mr. Fernandez. Thank you, Mr. Chairman.
    Before I talk about EDA's response to the oil spill, I, 
too, want to express our sincere condolences to the families 
who lost their family members after the explosion. I also want 
to say thank you and express our gratitude to the incredible 
work of all the first responders and their extraordinary 
efforts to actually rescue over 100 other survivors.
    While the responsible parties, rather than EDA, will 
ultimately be responsible for the economic damage caused by 
this spill, EDA will play a role in helping the affected 
communities recover. Though not a first responder, EDA 
facilitates delivery of Federal assistance to local 
governments' recovery efforts through technical assistance, 
strategic planning, and economic redevelopment grants.
    Shortly after the spill I asked our staff in the Austin and 
Atlanta Regional Offices, who are on the front line of this 
disaster, to reach out to our local partners. Regional office 
staff have contacted our network of local government partners 
in those affected areas to offer our agency's assistance. We 
deployed staff throughout the region to meet with local and 
State leaders as well our colleagues in other Federal agencies.
    On May 6 Secretary of Commerce Gary Locke, along with EDA 
leadership, met with local government and economic leaders in 
Biloxi and Pensacola. Our staff remain in regular contact with 
local, State and Federal partners.
    While in the short term EDA's regional staff is already 
providing some technical assistance, our focus will remain on 
promoting long-term economic recovery and we will continue to 
work closely with affected communities long after the clean up 
is complete.
    Successful long-term recovery based upon well developed 
planning efforts can help a community not only get back to 
where they started prior to a disaster, but also develop new 
economic opportunities, make improvements to their 
infrastructure, and be better prepared for future disasters.
    In my written testimony I have set out some of the 
technical frameworks for EDA's engagement in disaster recovery 
efforts. In the time I have left with my statement I would like 
to just provide a real simplified overview.
    Economic disasters, whether they are caused by forces of 
nature or if they are man-made, each bring their own unique set 
of challenges. Rather than pursuing a one size fits all 
approach EDA works directly with State and local leadership to 
develop customized responses.
    The key to EDA's success in responding quickly and 
effectively to disasters and economic disruptions is its 
Economic Adjustment Assistance Program. This program allows for 
a wide range of technical assistance, strategic planning, gap 
financing, and infrastructure assistance. It is a complete 
toolbox of development tools which EDA can leverage.
    Most importantly the Economic Adjustment Investment Program 
can select projects that are multifaceted, which allows us to 
develop an integrated response with a single grant application. 
In order to assist communities impacted by the oil spill, the 
President last week sent Congress a legislative package that 
included $5 million for EDA's Economic Adjustment Assistance 
Program.
    EDA's long involvement with communities before and after a 
disaster has taught us a few truths. First and foremost, the 
communities that emerge strongest from these catastrophic 
events are those that have a detailed strategic plan in place 
before the event ever occurred. That is a significant reason 
why the Obama administration is working to ensure that the 
Federal Government is prepared for a swift and coordinated 
response to future large or catastrophic disasters. Through 
advanced planning and strong coordination, the Federal 
Government can help affected communities response faster and 
recover more fully through new economic opportunities that will 
result in sustainable and economically viable communities.
    Mr. Chairman, again, I thank you for the opportunity to 
address EDA's role in the economic disaster response. I can 
tell you I have spent the last several weeks visiting 
communities where EDA has helped in recovery efforts. I can 
tell you I am very proud of the work that the agency does in 
this area.
    EDA is ready and prepared to do our best to assist with the 
devastating impact of this oil spill in the Gulf Coast region. 
We certainly look forward to working with Congress to 
strengthen the Federal Government's coordinated response, and I 
certainly welcome any questions that you might have.
    [The prepared statement of Mr. Fernandez follows:]
    
    
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    Senator Whitehouse. Thank you very much, Assistant 
Secretary Fernandez.
    Admiral Neffenger, the New York Times and others have 
reported that there are enormous oil plumes now in the deep 
waters of the Gulf, including one 10 miles long, 3 miles wide, 
and 300 feet thick in spots. This spill didn't happen at the 
surface. It happened in the depths of the Gulf. We have a 
pretty good sense from visual observation of how far it has 
reached at the surface level. How good do you believe our 
country's modeling is of the shape, size, and location of the 
undersea oil?
    Admiral Neffenger. As you know, the National Oceanic and 
Atmospheric Administration is the primary agency responsible 
for doing spill trajectory models and the like. They have been 
looking very carefully at that question.
    I can tell you that there is still some uncertainty as to 
what was actually seen there. Dr. Jane Lubchenco--I believe it 
was yesterday--issued a statement that the scientific evidence 
is inconclusive right now as to what that actually was that 
they have seen.
    Nonetheless there is some concern that there is an 
underwater plume that might be forming. So there is a team 
working on that right now. It is a technical team that is 
looking at all the data that we are collecting right now, as 
well as collecting data to determine really what they are 
seeing out there and why it might mean with respect to the 
extent of this oil spill.
    Senator Whitehouse. So it would be not accurate to think 
that there is a sort of a 3-D model on a computer someplace 
that shows where this enormous blob of oil has traveled to 
under the water. We don't have that kind of situational 
awareness as to the oil that is still in the water column.
    Admiral Neffenger. Well, I think that it would be accurate 
to say that, but I would qualify it by saying that until there 
is some certainty as to what is actually being seen underwater 
it is difficult to model what it might be doing. So I would 
qualify it by that. It is not so much that there is not an 
accurate model but that you need more data to determine what 
that model might look like.
    Senator Whitehouse. Do you have a sense of how much of the 
oil that has been spilled in this incident has stayed in the 
water column as opposed to rising to the surface and making 
itself more apparent to the human eye?
    Admiral Neffenger. As you know, we have dispersed oil in 
the water column as well as oil that may be naturally 
dispersing from the flow. I don't have a good set of numbers 
for how much in terms of relative percentage would be sub-
surface as opposed to on the surface. Again, these technical 
teams are looking at that data now, so we are bringing in not 
only just NOAA scientists but setting up a peer review process 
to take a look at that. These are important questions to 
answer.
    Senator Whitehouse. Are you at the point where you know 
that it is more than half or less than half that went to the 
surface?
    Admiral Neffenger. I don't believe I could quantify it 
right now, sir.
    Senator Whitehouse. OK. So it is really a huge question 
mark at this point.
    Admiral Neffenger. It is a question mark for us at this 
point.
    Senator Whitehouse. OK. That is a very big unknown, isn't 
it?
    I read a story in The Wall Street Journal this morning that 
said that in 2004, managers of BP plc, the oil giant involved 
in this incident and another oil rig incident that they 
described in the article, warned in a trade journal that the 
company wasn't prepared for the long-term, round the clock task 
of dealing with a deep sea spill.
    I was a little bit surprised that nobody picked up on that. 
You would think that unless this is a trade journal with no 
readership whatsoever somewhere somebody within the Coast Guard 
or within NOAA or within MMS would have been pinged to the fact 
that here was this enormous corporation with a considerable 
deep sea drilling footprint basically confessing that it is not 
ready to deal with an emergency that might ensue if something 
went wrong.
    Do you have any sense of why that might have been missed? 
That would seem like kind of a telltale moment.
    Admiral Neffenger. What I can say, Senator, is with respect 
to this spill as well as with respect to our interaction with 
companies like BP for oil spill response plans, and I will 
clarify that our interaction has to do with vessel spill 
response plans, tank vessel. So we deal with the shipping side 
of the world, if you will, so the mobile offshore units and the 
vessels.
    Senator Whitehouse. Do you consider a floating rig to be a 
vessel?
    Admiral Neffenger. In this case, this one was. Yes. This 
was a self-propelled offshore drilling unit, so it was 
classified as a vessel.
    Senator Whitehouse. But if they stand on legs, they are 
not. And if they are floating like this one, they are.
    Admiral Neffenger. It depends on what kind of action they 
are taking. Some rigs that stand on legs can be classified as 
vessels as well.
    Senator Whitehouse. But in any event this was a vessel.
    Admiral Neffenger. This was a vessel. Right. So it was 
required to have and did have a non-tank vessel response plan 
for response to a spill generated by the vessel. In this case 
that MODU had some 700,000 gallons of fuel oil and other oils 
on board.
    So we were satisfied that they had the response assets in 
place and the oil spill removal organization contracts in place 
to deal with a spill from that vessel should it have occurred. 
And that would be for a worst case discharge from that vessel, 
which would have been a complete loss of its fuel oil.
    I am not familiar with the article that you are mentioning, 
so I can't really speak to what it says.
    Senator Whitehouse. OK. We will follow up on that.
    The dispersants that were used were at some level approved 
by the Coast Guard as the Incident Commander, correct?
    Admiral Neffenger. Actually the way that works is there is 
a regional response team which is co-chaired by the Coast Guard 
and EPA. This is a collection of government agencies and 
stakeholders and resource trustees that pre-approve the use of 
alternative technologies. In this case there was a pre-approval 
existing that had been vetted through that interagency work 
group for the use of dispersants that made that available to 
the Federal on-scene coordinator for use during this spill.
    Senator Whitehouse. So who selected Corexit 9500A and 
Corexit 9527A as the dispersants?
    Admiral Neffenger. I would assume that that was pre-
approved by that regional response team so they would have 
approved those types of dispersants in their pre-approval 
process.
    Senator Whitehouse. Do you think those were the only two 
dispersants that were pre-approved?
    Admiral Neffenger. I can check on that for you, Senator. I 
don't know exactly, but we can provide for the record a copy of 
the pre-approval checklist that was provided to the FOSC.
    [The information follows:]

    The Federal On-Scene Commander, with the concurrence of the 
Environmental Protection Agency (EPA) representative to the 
Regional Response Team (RRT), and in consultation with the 
Department of the Interior, Department of Commerce, and where 
appropriate the State and tribal representatives to the RRT, 
authorizes the responsible party to use dispersants that are 
listed on the National Contingency Plan Product Schedule.
    In accordance with 40 CFR 300 subpart J, the Environmental 
Protection Agency (EPA) approves dispersants for use in U.S. 
waters based on tests for toxicity and effectiveness. Any 
product listed on the schedule must meet a threshold minimum 
for effectiveness and test for and report on toxicity. No 
States have expressed reservations about the use of these 
dispersants in the past as long as the dispersant is employed 
in accordance with the Regional Response Team Dispersant-Use 
pre-authorizations agreements established between the States 
and their Federal partners at the regions around the country.
    The toxicity data table at http://www.epa.gov/emergencies/
content/ncp/tox_tables.htm provides toxicity data for the 18 
dispersants listed. Toxicity values should not be interpreted 
as absolute values but rather relative to one another in a 
general sense. For example, an LC50 of 4.49 should not be 
viewed as significantly different from an LC50 of 5.95. But the 
LC50 of 4.49 can be viewed as significantly different from the 
LC50 of 42.00. Therefore, the toxicity values can be used to 
group dispersants (two or three groups of similar toxicity) but 
should not be used to list dispersants according to toxicity (1 
to 20).
    All 18 products on the National Contingency Plan Product 
Schedule are selected based on volume availability, specifics 
of the site, and concerns of the Federal On-Scene Coordinator. 
Toxicity tests are methods for determining the impact of a 
chemical or an effluent on living organisms and measure the 
degree of response using commonly tested species. Many 
different kinds of tests can be used to identify potential 
toxic effects, but since toxic effects differ, comparing the 
toxicity of one to another may not be appropriate.

    Senator Whitehouse. OK. That would be of interest, and I 
appreciate that.
    Mr. Fernandez, could you describe a little bit more the 
role of the Economic Development Administration in this 
circumstance a little bit more tangibly? Here is the disaster. 
You come in. Who do you first talk to? What is your goal? How 
do you know when you have succeeded?
    Mr. Fernandez. I can. Speaking specifically to the Gulf 
spill or generally?
    Senator Whitehouse. Generally. We have just recently had 
flooding in Rhode Island, for instance, so make your answers 
germane to that as well. That would be helpful.
    Mr. Fernandez. I can tell you how we would respond in most 
cases, and I will use the Rhode Island one as a specific 
example.
    I know that representatives from our field office get 
engaged with local officials, county and municipal officials, 
city officials. There are economic development organizations 
that we fund to do long-term planning. Those economic 
development districts, we will engage with them. And what we 
try and do early on is have as many conversations as we can to 
get a sense of what the damage is on the ground, what resources 
are in place in terms of any prior disaster planning or 
resiliency work that the community may have done in advance, 
which can accelerate the response.
    And as we collect information it really depends on whether 
or not there has been a formal trigger or not of the Stafford 
Act.
    Senator Whitehouse. Assume there has been the disaster 
declaration.
    Mr. Fernandez. If the declaration has been enacted that 
means that the community can have immediate access to our 
existing EDA programs in the event that they were not otherwise 
eligible. That is an important trigger in some regards to the 
fisheries as well.
    Senator Whitehouse. This is primarily a planning function? 
Or is this an actual relief function?
    Mr. Fernandez. Both. What it does is that it means that if 
you are in an eligible area, or regardless of eligibility if 
you are in an area that has been triggered by Stafford, you 
have access to our implementation grants as well as planning 
grants. And you also have the ability to dispense with the 
traditional matching requirement, which turns out to be a big 
deal in most disaster recovery efforts.
    Senator Whitehouse. But the ultimate function of that 
exercise is a planning process, not providing relief to 
particular individual businesses.
    Mr. Fernandez. There are two things that can happen. There 
is certainly the planning component. Often what we find to be 
the most important request is that we actually fund disaster 
relief coordinators, folks who can come into the community, 
work with others to help them best access not just EDA 
assistance, but the full Federal portfolio. That can be a very 
important immediate investment that we make through our grant 
dollars.
    Then certainly the planning component is important. Once 
those plans are in place, if there are specific implementation 
investments we can consider those as well.
    Senator Whitehouse. Very good.
    I see that my time has expired, and I know you have been 
here. It has been a long afternoon for all of you. I appreciate 
very much our efforts to facilitate the resolution of the Gulf 
spill, and again a particular salute to the Coast Guard.
    But to all of you, thank you very, very much.
    The hearing is adjourned. We will stay open for 2 weeks for 
anything anybody cares to add to the record of the hearing.
    Thank you again.
    [Whereupon, at 5:55 p.m. the Committee was adjourned.]

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