Agency that oversees offshore drilling may be split

WASHINGTON - The Obama administration is proposing to split up an Interior Department agency that oversees offshore drilling, as part of its response to the Gulf Coast oil spill.

Interior Secretary Ken Salazar called for a plan to split the Minerals Management Service in two. One agency would be charged with inspecting oil rigs, investigating oil companies and enforcing safety regulations, while the other would oversee leases for drilling and collection of billions of dollars in royalties.

That would separate the agency's two core responsibilities, which critics say are diametrically opposed - making money off the industry, while also cracking down on it in ways that may affect the industry's bottom line.

"The tragedy aboard the Deepwater Horizon and the massive spill for which BP is responsible has made the importance and urgency of our reform agenda even clearer," Salazar said.

He said the administration has been aggressive in its response to the spill, "but we must also aggressively expand the activities, resources and independence of federal inspectors so they can ensure that offshore oil and gas operations are following the law, protecting their workers, and guarding against the type of disaster that happened on the Deepwater Horizon."

The Minerals Management Service oversees the nation's natural gas, oil and other mineral resources. The agency collects and distributes more than $13 billion a year in revenue from federal leases for offshore and onshore drilling. It also enforces laws and regulations that apply to drilling operations.

Some critics have said the two roles are in conflict and are one reason the agency has long been accused of being too cozy with the oil and natural gas industry. There is growing bipartisan sentiment in Congress in favor of toughening oversight of the agency. - AP