Leaders of the oil industry and their allies in Washington, D.C., have had a relatively warm relationship with James Watson.
Photo: Brett Coomer, Staff

WASHINGTON - The nation's top offshore drilling regulator is to step down later this year, just as the federal government drafts new rules to boost the safety of coastal oil exploration.

In leaving the Interior Department's Bureau of Safety and Environmental Enforcement, Director James Watson will return to his maritime roots. The retired Coast Guard admiral will take over as president and chief operating officer for the Americas division of the maritime classification society ABS.

Watson announced he was leaving in an email to bureau staff Tuesday.

Created in the wake of the 2010 Gulf of Mexico oil spill, the agency is tasked with policing the offshore drilling industry. Watson, its second director, has been on the job since December 2011.

Interior Secretary Sally Jewell praised Watson for helping to "implement the most aggressive and comprehensive offshore oil and gas regulatory reforms in the nation's history."

During his tenure, Watson has presided over the implementation of broad new rules requiring oil and gas companies holistically to assess and mitigate risks offshore and then subject those safety programs to regular audits.

And he has continued the bureau's aggressive stance toward penalizing offshore contractors and services firms for violations. That strategy, adopted under Watson's predecessor, Michael Bromwich, moved regulators beyond their historical focus on policing just the oil and gas companies operating offshore.

Oil industry leaders and their allies on Capitol Hill have had a relatively warm relationship with Watson, in contrast to more combative interactions with some prior offshore regulators.

"Director Watson took the time to understand the offshore energy industry and was always willing to meet with industry members to discuss mutual issues and concerns," said Randall Luthi, president of the National Ocean Industries Association.

It's not clear whether Watson's departure will affect the timeline for new proposals to tighten performance standards on critical emergency equipment called blowout preventers and production systems used offshore. Those mandates were on track to be proposed formally later this year.

In an interview with the Houston Chronicle, Watson stressed his desire to heed input from oil and gas operators, drilling companies, equipment manufacturers and other stakeholders in writing the rules.

Whoever President Barack Obama selects to replace Watson could assume the job quickly, because Congress has not passed legislation formalizing the bureau and requiring its director to get Senate confirmation.

Watson is expected to leave the agency post by September.

At ABS, founded in 1862 as the American Bureau of Shipping, he will have responsibility for activity in North, South and Central America, as well as the Caribbean.

Before joining the safety bureau, he was the Coast Guard's director of prevention policy for marine safety, security and stewardship. He also was the federal on-scene coordinator for the governmentwide response to the 2010 oil spill as crude was still gushing out of BP's Macondo well.

Watson praised bureau staff for working in hazardous conditions to raise the safety of offshore oil and gas development.

"The challenge of doing safety and pollution prevention is you never really know how many lives and spills you saved," he said. "You just have to believe in your mission and your proficiency at succeeding in what you set out to do."
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