US will revise Biden-era offshore oil and gasoline bonding rule

(Reuters) -The Trump administration will revise a Biden-era rule that required the oil and gasoline business to supply practically $7 billion in new monetary assurances to cowl the price of decommissioning previous infrastructure, the Inside Division stated on Friday.

In a press release, the company stated it will develop a brand new regulation, however didn’t give specifics. The transfer is aligned with President Donald Trump’s push to cut back federal rules and enhance home vitality manufacturing.

An Inside spokesperson declined additional remark.

“This revision will allow our nation’s vitality producers to redirect their capital towards future leasing, exploration, and manufacturing all whereas financially defending the American taxpayer,” Inside Secretary Doug Burgum stated within the assertion.

The Biden coverage, which was finalized final yr by the Inside’s Bureau of Ocean Vitality Administration, required corporations with out investment-grade credit score rankings or ample oil and gasoline reserves on a lease to supply supplemental bonding to cut back the danger to taxpayers within the occasion the driller couldn’t cowl the price to dismantle gear.

The rule was challenged in court docket by three oil-producing states who alleged the rule would enhance prices for smaller corporations. A federal choose declined to dam the rule earlier this yr.

The rule was supported by environmental conservation teams just like the Sierra Membership that stated on the time that Biden’s reform would “be certain that oil and gasoline corporations are accountable for his or her cleanup duties and taxpayers gained’t be left holding the bag.”

(Reporting by Nichola Groom)