The Department of the Interior’s Bureau of Ocean Energy Management (BOEM) has made modifications to monetary penalties for oil and gas companies, implementing the 2024 inflation adjustments for the maximum daily civil monetary penalties contained in BOEM regulations per Federal law.
The Bureau of Ocean Energy Management made the final rule announcement on Thursday, January 25, 2024, explaining that the Federal Civil Penalties Inflation Adjustment Act Improvements Act (FCPIAA Improvements Act) of 2015 requires Federal agencies to adjust the level of civil monetary penalties for inflation annually.
These adjustments for violations of the Outer Continental Shelf Lands Act (OCSLA) and the Oil Pollution Act of 1990 (OPA) are intended to maintain the deterrent effect of civil penalties and further the underlying statutes’ policy goals.
For 2024, BOEM multiplied the current OCSLA maximum daily civil monetary penalty of $52,646 by the multiplier 1.03241, which equals $54,352.26. In addition, BOEM multiplied the current OPA maximum daily civil penalty amount of $55,808 by the multiplier 1.03241 to equal $57,616.74.
As the Improvements Act requires the resulting amount to be rounded to the nearest dollar, the final rule adjusts the maximum daily civil monetary penalties per violation to $54,352 for violations under the Outer Continental Shelf Lands Act and to $57,617 for violations under the Oil Pollution Act of 1990.
“The Final Rule is available via the Federal Register. The adjusted penalty levels will take effect immediately upon publication of this rule,” concluded BOEM.
The U.S. is also working to curb the oil and gas industry’s emission footprint, including the methane one. To this end, the U.S. Environmental Protection Agency (EPA) recently proposed a new rule in line with the Biden-Harris administration’s Inflation Reduction Act (IRA).