The Minerals Management Service (MMS) is the federal agency that oversees offshore drilling. Interior Secretary Ken Salazar has pushed to split the MMS into two agencies. One would enforce safety rules and inspect oil rigs, the other would handle leases and collect royalties from oil companies. Brian Naylor, correspondent, NPR
NEAL CONAN, host: As oil continues to spew into the Gulf of Mexico from a deepwater well, the Obama administration today proposed changes to the federal agency that oversees offshore drilling. In an announcement today, Interior Secretary Ken Salazar pushed to split the Minerals Management Services into two agencies. One to enforce safety rules and inspect oil rigs, the other to handle leases and collect the billions of dollars in royalties from oil companies.</s>Secretary KENNETH SALAZAR (Department of Interior): I believe the job of ensuring energy companies follow the law and protect the safety of their workers and the environment should be independent from MMS' leasing, revenue collection and permitting functions. We will approach this restructuring responsibly and thoughtfully. And we will ensure the American people that they have a strong and independent organization holding energy companies accountable and in compliance with the law of the land.</s>NEAL CONAN, host: Critics complained the dual mission of the current agency creates a conflict of interest, that MMS, as a result, is too cozy with the oil companies it regulates. Some have described the agency as a culture of substance abuse and promiscuity.</s>NEAL CONAN, host: Also, today, Congress began hearings into the cause of the explosion that killed 11 men and the massive oil leak that followed. Officials from BP, Transocean and Halliburton testified before the Senate Committee on Energy and Natural Resources. So who regulates what, how might that change, what did we learn today?</s>NEAL CONAN, host: Joining us here in Studio 3A is NPR's Brian Naylor, who's been following all this. Brian, nice to have you on the program.</s>BRIAN NAYLOR: Thanks, Neal.</s>NEAL CONAN, host: And we learned at least one thing today about what happened before the deadly explosion. The blowout preventer that was supposed to help protect against an oil spill had been modified.</s>BRIAN NAYLOR: Well, right. And what you heard today were - there were three company executives testifying before two Senate committees, the chairman of BP - BP which owns the well, Transocean, which was drilling for the oil, and Halliburton, a subcontractor which was in charge of sealing the well and in injecting a kind of a cement into the well to secure it. And what you saw today was the spectacle of these three gentlemen sitting shoulder to shoulder, all pointing the fingers at one another.</s>BRIAN NAYLOR: BP said that its hands were clean, as it were, in this. That it was Transocean's job to see  oversee the drilling function. Transocean said, well, we did what we were supposed to do and it was Halliburton that was supposed to seal this well properly and they didnt do it. And Halliburton then turned around and pointed the finger back at BP, said, well, it's your well, it's your responsibility.</s>NEAL CONAN, host: And tomorrow, we're going to hear from the manufacturer of the BOP valve, the blow out preventer valve, saying presumably somebody else's fault.</s>BRIAN NAYLOR: Well, right. And it's unclear who they'll pass the buck to. But there's a lot of that going on right now on Capitol Hill.</s>NEAL CONAN, host: We're talking with NPR correspondent Brian Naylor about the hearings today up on Capitol Hill and about the regulatory agency that's responsible for overseeing offshore drilling.</s>NEAL CONAN, host: You're listening to TALK OF THE NATION from NPR News.</s>NEAL CONAN, host: And Brian, there's going to be a lot more on these hearings later today on ALL THINGS CONSIDERED.</s>NEAL CONAN, host: But I want to focus on this proposal to divide MMS. As I understand it, United States is one of the few places in the world that's involved in oil production where both the environment and safety are in the same agency as operations.</s>BRIAN NAYLOR: Yeah. And this is something that critics have been decrying for some time now, that there's an inherent conflict of interest. You have the same agency that's in charge of collecting revenue which - $13 billion last year, which is the second largest amount of incoming revenue stream, second only to the  what the IRS collects in our taxes.</s>BRIAN NAYLOR: So you have this agency that collects all this revenue, that works with the oil companies to identify and develop new drilling sites. And this agency is also in charge of policing the - regulating how the drilling is conducting  is being conducted, overseeing the environmental aspects of it and overseeing the workers' safety aspects of it. So, clearly, this is an agency that had a lot on its hands. And many said too much on its hands, too much for it to manage.</s>NEAL CONAN, host: Critics said that, in effect, they let the oil companies pretty much manage themselves. You saw a lot of memos saying, well, all the big experts work for the oil companies, they know better than we do.</s>BRIAN NAYLOR: Well, that's right. And they let them develop their own environmental impact statements, if you will, which is the case with BP in the Gulf. They've consistently downplayed the effects of a possible spill. I've got a page from an environmental impact statement. When they first decided to allow drilling in this portion of the Gulf, they said oil spills resulting from a proposed action are not expected to damage significantly any wetlands along the Gulf Coast. I think there are a lot of people down there who would beg to differ with that assessment today.</s>NEAL CONAN, host: By splitting these two parts, what is that going to take? Is that legislation? Or is it just an executive order?</s>BRIAN NAYLOR: It's a little bit unclear. Secretary Salazar said that there is a legislative package that's being developed to send to Capitol Hill. He's going to try to do some things himself. He can clearly reallocate some resources and some personnel. But it seems as though Congress is going to have to weigh in.</s>BRIAN NAYLOR: One of the things that Salazar has suggested, and many on the Hill have suggested this in the past, the director of the Minerals Management Service right now is just simply appointed. Its not - he or she is not congressionally confirmed. And so, that would be a change. They would go through the confirmation process.</s>NEAL CONAN, host: Thats what Congress gets in return for this.</s>BRIAN NAYLOR: Right. Right.</s>NEAL CONAN, host: This lack of management, there was a scandal not just a few years ago with MMS.</s>BRIAN NAYLOR: Yeah. In 2008 in the Denver office, it was found that there were employees who were taking drugs, buying marijuana, sleeping literally with some of the people that they were regulating. It was...</s>NEAL CONAN, host: From the oil business.</s>BRIAN NAYLOR: From the oil business, yeah. It was called a culture of  I'm trying to find the quote here in all of my papers. But clearly there was a lot of  the inspector general looked into this and found a very deplorable situation. Several of those people were fired but others remain. And it just sort of points to the overly cozy relationship between this agency and those its supposed to regulate.</s>NEAL CONAN, host: And nevertheless, nothing changes until after a disaster in the Gulf of Mexico, which is being compared more and more to the Exxon Valdez situation, the tanker that wracked in Alaska and caused untold damage there.</s>NEAL CONAN, host: And it is a reminder that the kind of blame game that we're seeing in Washington today - these executives all pointing figures at each other, this is all going to be hashed out in court. Eventually, probably at the Supreme Court, and it could be a decade or so before this is all settled.</s>BRIAN NAYLOR: Yeah, there's going to be a lot of suing and countersuing going on. I think that's one thing that's clear. Although, the executive from BP today made clear that they intend to pay every legitimate claim.</s>NEAL CONAN, host: Legitimate.</s>BRIAN NAYLOR: Well, and that's going to be determine down the road exactly what's legitimate and what's not, obviously. But they're making the case that they're - no matter the - they're not looking at bottom line. We'll see. Well see. But I'm sure that whatever BP pays out, they're going to  it would be fair to assume they're going to try to recover some of that from some of their subcontractors, as well.</s>NEAL CONAN, host: Brian Naylor, thanks very much for being with us today.</s>BRIAN NAYLOR: Thank you, Neal.</s>NEAL CONAN, host: NPR correspondent Brian Naylor talking to us about MMS. And what now may be two federal agencies if the proposal from the secretary of the interior is accepted by Congress and the president.