BP Doesn’t Have Agreement to Resume Gulf of Mexico Drilling, Salazar Says

BP Plc (BP/) doesn’t have an agreement with the U.S. to resume drilling in deep waters of the Gulf of Mexico, Interior Secretary Ken Salazar said.

Salazar spoke on a conference call with reporters today, denying a report in the Sunday Times of London, which cited unnamed persons saying the London-based company had reached an agreement with the U.S. to resume drilling.

“There is no agreement with respect to BP, nor will there be any agreement with respect to BP or anybody else that isn’t within the normal process that we have,” Salazar said on a call from Mexico City. “We receive applications for wells, and those applications will be taken through the same process, with the same rigorous review that we are requiring of any other company.”

Companies that want to explore for oil in the Gulf’s deep waters have to apply to Interior’s Bureau of Ocean Energy Management, Regulation and Enforcement, demonstrate access to equipment helping contain spilled oil, and meet higher safety and environmental standards introduced after BP’s Macondo well in the Gulf exploded on April 20, causing the biggest U.S. offshore oil spill.

Eight Wells

The bureau has approved drilling on eight wells in waters deeper than 500 feet (152 meters) after a ban on such operations was lifted in October. BP has a stake of about 47.5 percent in the site called the Santiago prospect, which was the first to win Interior’s approval to resume operations on Feb. 28. Houston-based Noble Energy Inc. (NBL) is the operator on that project.

BP spokesman Daren Beaudo didn’t return a phone call and an e-mail seeking comment today on reports citing unnamed company executives, including in the New York Times, that BP is seeking approval to resume drilling.

“There are no ongoing talks” with BP, Melissa Schwartz, a spokeswoman for Interior Department’s agency regulating offshore drilling, said in an e-mail today. “We issue permits based on the merits of the application.”

Schwartz declined to comment further when asked whether there had previously been talks with BP about a proposal to resume drilling.

To contact the reporter on this story: Katarzyna Klimasinska in Washington at kklimasinska@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net.

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