The Interior Board of Land Appeals (“IBLA”) has issued its long awaited decision on an appeal by an offshore service contractor challenging the authority of the Bureau of Safety and Environmental Enforcement (“BSEE”) to issue a citation directly to the service company for a violation of federal offshore regulations. As the first formal opinion issued by any appellate body on the issue, the IBLA decision has widespread implications for the offshore services industry. The IBLA, not surprisingly, upheld BSEE’s notice of violation (“INC”) under its assertion of regulatory authority over service contractors working on oil and gas leases on the Outer Continental Shelf (“OCS”). The contractor, Island Operating Co., Inc. (“Island Operating”), along with a number of industry groups who jointly filed an amicus brief, may appeal the IBLA’s decision to the District Court.

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