Minerals Management Service MMS

Interior Secretary James Watt created the Minerals Management Service by secretarial order on January 19, 1982, combining offshore leasing and royalty collection functions previously handled by the Geological Survey and the Bureau of Land Management. It became one of the government's largest sources of non-tax revenue, collecting billions of dollars a year in rents, bonuses, and royalties from oil, gas, and mineral production on federal lands, offshore areas, and Indian lands.

MMS ran lease sales for drilling on the Outer Continental Shelf, especially in the Gulf of Mexico, reviewed exploration and drilling plans, inspected offshore platforms, enforced safety and environmental rules, and audited and collected royalties owed by energy companies. Critics argued that a single agency charged with maximizing leasing and revenue while also policing industry safety had a built-in conflict of interest. In 2008 the Interior Department's inspector general reported that employees in its royalty-in-kind program had accepted gifts from and had improper relationships with industry representatives.

On April 20, 2010, the Deepwater Horizon drilling rig exploded in the Gulf of Mexico, killing 11 workers and causing the largest marine oil spill in U.S. history, with millions of barrels released over 87 days. Investigations faulted lax federal oversight, and Secretarial Order 3299 of May 19, 2010, broke MMS apart. Its revenue functions became the Office of Natural Resources Revenue on October 1, 2010, and on October 1, 2011, its remaining duties were split between the Bureau of Ocean Energy Management, which handles leasing, and the Bureau of Safety and Environmental Enforcement, which handles safety. Supporters said separating the missions would end the conflict of interest, while some in industry argued that the split added layers of review.