The Department of the Interior has announced a proposed update aimed at reducing regulations for the offshore oil and gas sector. The proposal targets rules established in 2024 that required companies to reserve approximately $6.9 billion in supplemental financial assurance, with about $6 billion of this amount affecting small businesses operating on the Outer Continental Shelf. If adopted, the change is expected to save the industry an estimated $484 million annually in compliance expenses.
“For too long, Washington red tape has strangled American energy producers and held back small businesses,” said Interior Secretary Doug Burgum. “President Trump is delivering on his promise to put American workers first, cut burdensome regulations and unleash our vast energy potential. These updates will free up billions of dollars for exploration and development, create good-paying jobs and unlock domestic energy production so we are never forced to rely on foreign adversaries for the resources that power our economy.”
The Bureau of Ocean Energy Management (BOEM) developed this proposal following President Trump’s Executive Order 14154, titled “Unleashing American Energy.” The plan includes updating BOEM's methods for evaluating financial risk and reducing the funds companies must allocate for future decommissioning costs. By applying new risk assessment metrics and incorporating data from the Bureau of Safety and Environmental Enforcement, BOEM intends to keep protections for taxpayers while enabling greater investment by companies in new projects.
Although accountability requirements under the Outer Continental Shelf Lands Act will remain in place, officials state that excessive financial barriers have slowed industry growth in recent years.
The proposed rule changes will be published in the Federal Register, initiating a 60-day period during which members of the public can submit comments. Additional details are available on BOEM’s financial assurance webpage.
