FOR RELEASE:  December 2, 1994             CONTACT:  John Barclay
                                                   (202) 208-5890

                   GROUP TO RECOMMEND CHANGES
          IN OPA FINANCIAL RESPONSIBILITY REQUIREMENTS

     A special subcommittee of an Interior Department advisory
group has been asked to recommend ways to implement a law
mandating new financial responsibility requirements for the
offshore oil industry without causing severe economic damage.

     Minerals Management Service (MMS) Acting Director Cynthia
Quarterman said MMS supports the Oil Pollution Act of 1990 (OPA)
and its aim of making sure that financial responsibility is
available for environmental damages.  "We are, however, aware
that we must try to find a way to reach that goal in a way that's
not destructive."

     Outer Continental Shelf (OCS) Policy Committee Chairman Paul
Kelly said the subcommittee was formed in response to a request
from Interior Assistant Secretary Bob Armstrong. Armstrong had
asked the Committee, an arm of the Interior Department's Minerals
Advisory Board, to find ways MMS can implement the financial
responsibility requirements of the new law.  The subcommittee
will handle that task, Kelly said, including proposing
legislative changes if members feel implementing the law as
written would cause severe consequences Congress may not have
intended.

     The law requires facilities that handle, store or transport
oil offshore to show proof that they can satisfy liability for
$150 million in damages from possible oil pollution.  OPA expands
the liability from the previous $35 million level and also covers
facilities which handle oil in state coastal and inland waters. 
Previously, only facilities on the Federal OCS had been affected
by the financial responsibility requirements.

     An opinion received this week by MMS from the Interior
Department's Solicitor says the agency has little leeway in
interpreting certain provisions of the Act.  The opinion said the
law and court precedents mandate a very broad definition of an
"offshore facility," to include oil-related installations on
inland waters (lakes, rivers, canals and other waterways
including wetlands.)  In certain instances, the Solicitor said,
appurtenances to onshore facilities that extend offshore may be
deemed a part of the onshore facility.  The opinion also said MMS
has no legal authority to reduce the $150 million requirement for
low-risk facilities.  Quarterman also asked the subcommittee to
propose legislative changes to OPA if necessary.

     "I hope the subcommittee will focus its efforts on ways to
resolve the potential problems raised as a result of the
Solicitor's findings," Quarterman said.  "This effort would
include proposing legislative changes necessary to help avert the
potentially significant economic impacts that could occur while
still meeting the spirit and intent of OPA.

     Chairman Kelly, vice president of Rowan Companies, Inc.,
named 13 representatives of various interest groups to a special
subcommittee to respond to MMS.  Members are: Robert R. Jordan,
Delaware Geological Survey; Robert D. Armstrong, The Louisiana
Land and Exploration Company; Robert C. Ball, Ashland Petroleum
Company; Margot J. Brown, National Boating Federation; Larry
Innis, Marina Operators Association of America; Joseph
Martinelli, Chevron Pipe Line Company; Thomas P. McConn, Seagull
Energy Exploration and Production, Inc.; James I. Palmer, Jr.,
Mississippi Department of Environmental Quality; Jerome Selby,
Mayor of Kodiak Island Borough; John Shively, NANA Development
Corporation; Lisa Speer, Natural Resources Defense Council;
Rosemary Stein, Exxon Company U.S.A.; and, Elissa Weil, American
Oceans Campaign.

     "We're bringing together representatives of affected parties
not normally associated with OCS issues, such as marinas and boat
owners, with the State governments, environmental groups and
industry people with whom we normally deal," Quarterman
continued. "This gives us a unique opportunity to address all
legitimate concerns and, I hope, forge a consensus."

                              -MMS-