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EU Offshore Safety Directive
Introduction & Welcome Robert Paterson
Health, Safety and Employment Issues Director Oil & Gas UK
Implementing The EU Offshore Safety Directive 2013 / 30 EU
Moira Lamb
Senior Business Analyst Health, Safety & Employment
Oil & Gas UK
Implementing the EU Offshore Safety Directive 2013 / 30 EU
EU Directive Intro & Background Presentation
Why are we changing our safety and environmental regimes…
Deepwater Horizon / Macondo explosion Gulf of Mexico April 2010
EC published draft Regulation October 2011
European Parliament and Council agree to Directive Feb 2013
EU Offshore Safety Directive published June 2013
EU Directive Intro & Background Presentation
Transition Timetable…
Formal UK consultation July – Sept 2014
UK legislation comes into force July 2015
EU Implementing Regulation published October 2014
EU Directive Intro & Background Presentation
• Regulations have been laid before parliament and will come into force July 2015;
• Safety Case guide is currently out for comment, Revision 2 of OPEP just published, continued work on tripartite arrangement (between OSDR, industry and workforce representatives);
• Continue to engage with HSE and DECC
• Further Information via OSDR website http://www.hse.gov.uk/osdr/index.htm
Where are we
Offshore Safety Directive (OSD)
Tony Hetherington Head of HSE Energy Division
HSE &
Wendy Kennedy, OBE Head Of Offshore Oil & Gas Environment and Decommissioning
DECC
Offshore Safety Directive (OSD) O&GUK Seminar
19th May 2015
Wendy Kennedy Tony Hetherington
Head of OGED, DECC Head of Energy Division, HSE
11 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Setting the Scene
Deepwater Horizon – 20 April 2010 – 11 workers killed. Pollution – 4.9 million barrels
EU Directive 2013/30/EU • Commission's initial aim was a European Regulation covering offshore oil and gas
operations
• The decision to move away from a Regulation was due, in large part, to the collaborative efforts of HSE, DECC and Industry
• Directive published 28 June 2013, and objective is to reduce as far as possible the occurrence of major accidents relating to offshore oil and gas operations and to limit their consequences
• Directive requires the establishment of a Competent Authority, and in the UK this will be delivered by OSDR, a regulatory partnership between DECC and HSE governed by an enhanced MoU
• Scope of Directive is vital to understanding the partnership Competent Authority and the regulatory regime that has been introduced in the UK to transpose the Directive
12 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Scope of Directive Article 2(1) ‘Major Accident’ means, in relation to an installation or connected infrastructure:
a) an incident involving an explosion, fire, loss of well control, or release of oil gas or dangerous substances involving, or with significant potential to cause, fatalities or serious personal injury;
b) an incident leading to serious damage to the installation or connected infrastructure involving, or with a significant potential to cause, fatalities or serious personal injury;
c) any other incident leading to fatalities or serious injury to five or more persons who are on the offshore installation where the source of danger occurs or who are engaged in an offshore oil and gas operation in connection with the installation or connected infrastructure; or
d) any major environmental incident resulting from incidents referred to in points (a), (b) and (c).
Article 2(37) ‘Major Environmental Incident’ means an incident which results, or is likely to result, in significant adverse effects on the environment in accordance with The Environmental Liability Directive
Scope doesn’t cover all of DECC’s or HSE’s regulatory responsibilities 13 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Partnership Competent Authority
14 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
HSE Competent Authority DECC Health and Safety at Work Design / Relocation Notification SEA
Occupational Safety Production Safety Case Environmental Impact
KP4 / Step Change Non-production Safety Case Habitats and Species
COSHH Well Operations Notification Chemical Use and Discharge
RIDDOR Combined Operation Notification Hydrocarbon Discharge
COMAH Material Change Notification Navigational Safety
GMO Verification Scheme Geological Surveys (Seismic)
Explosives CMAPP Marine Licensing
Etc., etc. Safety / Environmental Management Etc., etc.
Internal Emergency Response
DECC OGED Regulatory Drivers
15 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Industrial Emissions Directive 2010/75/EU on industrial emissions (integrated pollution prevention and control). Replaced Directive 2008/1/EC
Mercury Regulation (EC) No. 1102/2008 on the banning of exports of metallic mercury and certain mercury compounds / mixtures
Birds Directive 2009/147/EC on the conservation of wild birds (codified version of Directive 79/409/EEC as amended
Marine Strategy Framework Directive 2008/56/EC establishing a framework for community action in the field of marine environmental policy
Emissions Trading System (ETS) Directive 2009/29/EC amending Directive 2003/87/EC to improve and extend the greenhouse gas emission allowance trading scheme
Strategic Environmental Assessment (SEA) Directive 2001/42/EC on the assessment of the effects of certain plans and programmes on the environment
OSPAR Decision 2000/2 on a Harmonised Mandatory Control System for the Use and Reduction of the Discharge of Offshore Chemicals as amended by OSPAR Decision 2005/1
Environmental Impact Assessment (EIA) Directive 85/337/EEC, as amended by Directives 97/11/EC and 2003/35/EC)
Habitats Directive 92/43/EEC on the conservation of natural habitats and wild fauna and flora
The International Convention on Oil Pollution Preparedness, Response and Co-operation
OSPAR Recommendation 2012/5 implementing a risk-based approach for the management of produced water discharges from offshore installations
OSPAR Recommendation 2001/1 for the Management of Produced Water from Offshore Installations
OSPAR Decision 2000/3 on the Use of Organic-Phase Drilling Fluids (OPF) and the Discharge of OPF-Contaminated Cuttings
OSPAR Recommendation 2003/5 to Promote the Use and Implementation of Environmental Management Systems by the Offshore Industry
F-gas Regulation (EC) No. 842/2006 on certain fluorinated greenhouse gases
Ozone Depleting Substances (ODS) Regulations (EC) No. 1005/2009 on substances that deplete the ozone layer
DECC OGED Regulatory Framework
16 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
The Offshore Petroleum Activities (Oil Pollution Prevention & Control) Regulations 2005 (as amended)
The Mercury Export and Data (Enforcement) Regulations 2010
REACH Enforcement Regulations 2008
The Offshore Installations (Emergency Pollution Control) Regulations 2002
The Merchant Shipping (Oil Pollution Preparedness, Response and Co-operation Convention) Regulations 1998 (as amended) The Environmental Protection (Controls on Ozone–Depleting Substances)
Regulations 2011
The Fluorinated Greenhouse Gases Regulations 2015
The Offshore Chemicals Regulations 2002 (as amended)
Pollution Prevention & Control Act 1999
The Offshore Combustion Installations (Prevention and Control of Pollution) Regulations 2013
The Greenhouse Gas Emissions Trading Scheme Regulations 2012
The Energy Act 2008, Part 4A Works Detrimental to Navigation
The Offshore Petroleum Activities (Conservation of Habitats) Regulations 2001 (as amended)
The Marine & Coastal Access Act 2009
The Environmental Assessment of Plans and Programmes Regulations 2004
The Food and Environmental Protection Act 1985, Part II Deposits in the Sea
The Offshore Petroleum Production and Pipelines (Assessment of Environmental Effects) Regulations 1999 (as amended)
The Offshore Marine Conservation (Natural Habitats, &c.) Regulations 2007 (as amended)
The Energy Savings Opportunity Scheme Regulations 2014
The Energy Act 2008 (Consequential Modifications) (Offshore Environmental Protection) Order 2010
7 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Legislative Changes Main changes to the offshore oil and gas environmental regulatory regime to implement the Directive requirements are: • New Offshore Petroleum Licensing (Offshore Safety Directive) Regulations 2015; and • Amendment of the Merchant Shipping (Oil Pollution Preparedness, Response and Co-
Operation Convention) Regulations 1998.
Main changes to the offshore oil and gas safety regulatory regime, to be discussed by HSE, are: • The introduction of the Offshore Installations (Offshore Safety Directive) (Safety Case etc.)
Regulations 2015;
Additional environmental requirements now included in such safety cases: • Assessment of consequence of a major environmental incident • Safety and Environmental Management Systems and Safety and Environmental Critical
Elements • Internal Emergency Response Plan (including arrangements for oil pollution) • Corporate Major Accident Prevention Policy (including environmental protection)
17 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
New OGA Licensing Regulations - Licensing • Licensing Authority will be the Oil and Gas Authority (OGA) • Establishment of OGA, driven by the Wood Review, ensures functional separation
between the Licensing Authority and the Competent Authority • Licenses will continue to be granted under the Petroleum Act 1998, but the Directive
introduces new environmental and safety requirements, and the Competent Authority will have to be consulted
• OGA, via the Competent Authority, will be required to consider: – Safety and environmental performance of applicant – Safety and environmental management systems and structure – Sensitivity of local and adjacent environment, and potential cost of degradation of that
environment – Where details can’t be provided at application stage, commitments will be checked prior to
commencement of operations, including Financial Responsibility submissions relating to well operations
18 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
New OGA Licensing Regulations – Appointment of Operators
• Licensees will be required to appoint operators with respect to any offshore petroleum operations
• Proposed appointments must detail functions relating to the appointment • Licensees will be able to appoint installation operators and well operators, for all or
different phases of operations • Licensing Authority will be required to consult the Competent Authority who will
consider: – Safety and environmental performance of applicant – Safety and environmental management systems and structure – Sensitivity of local and adjacent environment, and potential cost of degradation of that
environment – Capacity to comply with relevant statutory provisions
19 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
New OGA Licensing Regs - Capacity of Operators • The Competent Authority will assess the capacity of operators to undertake their
duties, and notify OGA if the performance of the operator is considered unacceptable
• OGA must notify licensees of the Competent Authority’s determination • Where licensees are informed of a determination, the operator’s appointment must
be terminated • Where an operator’s appointment is terminated, the licensee becomes responsible
for carrying out the operator’s functions • Where an operator’s appointment is terminated, the licensee must propose a new
operator • Draft guidance on the safety and environmental requirements for licence
applications and the appointment of operators will be circulated to industry around the end of May 2015
20 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
OPRC 1998 Amendments • The new Safety Case Regulations require an Internal Emergency Response Plan,
which must include arrangements for responding to oil pollution • The Merchant Shipping (Oil Pollution Preparedness, Response and Co-Operation
Convention) Regulations (the OPRC Regulations) have been amended in relation to operations in external waters
• Oil Pollution Emergency Plans (OPEPs) remain essentially consistent with previous guidance, but certain changes have been made and include: – Requirement for Non-Production Installations to hold an approved OPEP; – Requirement to include / reference an inventory of response equipment and an assessment of the
effectiveness of oil spill response measures; – Changes to who is required to hold an OPEP (e.g. well operator, NPI owner, installation duty holder); – New terminology. Temporary Operations OPEP (TOOPEP) replaces ‘drilling addendum’. – Concept of a Communication & Interface Plan (CIP) introduced; – A 21 day regulatory review period for certain TOOPEPs and CIPs; and – Amended worst case modelling requirements.
21 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Other Environmental Controls
• Safety and environmental management should be the responsibility of approved persons in charge of day to day operations
• Environmental permits etc. will therefore be held by installation and well operators
• Responsibility and accountability for complying with the regulations will fall to installation and well operators
• OSPAR EMS reporting requirements will also fall to the installation and well operators
• Liability for environmental and economic damage, and financial security requirements will remain with licensee(s)
22 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
The OSDR Partnership • The European Offshore Safety Directive takes effect on 19th July 2015 • In the UK, the ‘Competent Authority’ required for the regulation of major offshore
hazards will be DECC and HSE working in partnership • The Competent Authority is called the Offshore Safety Directive Regulator (OSDR),
and referred to as ‘the OSDR Partnership’ • OSDR is not a new body, or separate legal entity, but it will have branding and
presence • The OSDR partnership will deliver the government’s commitments made in
response to the legislative consultation • From a stakeholder perspective, the OSDR organisational arrangements will
provide a single, consistent regulatory interface with the UK oil and gas industry for the safety and environmental issues relating to major hazards covered by the Directive.
23 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Single Regulatory Interface In practice, building a single, consistent regulatory interface for stakeholders includes: • Creating a website for information relating to the OSDR partnership and an online portal for all
regulatory notifications and submissions, regardless of whether the submissions relate to safety or environmental issues
• Developing a new on-line portal, to integrate with OGA licensing system (LARRY), the OGA and DECC register of installations (DEVUK) and the OGA well consents system (WONS)
• Building a single, coherent set of submission, assessment and acceptance procedures for safety cases, oil pollution emergency plans and the various other regulatory notifications and submissions that are required, including major hazard incident reporting.
• Providing a single intervention plan for each owner or operator of offshore installations covering all planned OSDR interventions, with the presumption of joint DECC / HSE visits where appropriate
• Coordinated investigations, with decisions made at an early stage as to which regulatory partner should lead, with aligned principles of enforcement covering safety and environment
24 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
OSDR Governance • OSDR will be governed by a joint DECC / HSE Senior Oversight Board (SOB) • OSDR operations will be managed by a joint DECC / HSE Operational Management
Team • OSDR will have a single, high level strategy on prevention and control of major
accident hazards • An enhanced Memorandum of Understanding, supported by an Articles of
Governance document and the strategy, will set out the OSDR governance and operational management arrangements
• A range of publicly available OSDR business process frameworks and supporting documents will detail the competent authority functions (many already online).
• Some OSDR business systems are already operational, for example the systems for handling safety cases and oil pollution emergency plans.
25 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Safety Case Regulations 2015 • SCR2015 replaces SCR2005 in relation to external waters, to provide for the
preparation of safety cases to meet the Directive requirements • Key changes from SCR2005:
– Require operators and owners to prepare and implement a Corporate Major Accident Prevention Policy (including environmental protection);
– Require operators and owners to prepare a document setting out the Safety and Environmental Management System (SEMS) and to integrate the SEMS with overall management systems;
– Introduce Safety and Environmentally Critical Equipment (SECE) into the requirements of the verification scheme;
– Introduce the concept of an Internal Emergency Response Plan (including oil pollution response arrangements) which must be described in the safety case; and
– Require the provision of environmental information, including an assessment of the consequence of a major environmental incident.
26 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Safety Case Transition to SCR2015 • All owners or operators of installations have received letters communicating when to
submit a revised safety case for assessment under the new 2015 Safety Case Regulations.
• The main changes required are to add: – CMAPP – Corporate Major Accident Prevention Policy – SEMS – Safety and Environmental Management System description – IERP – Internal Emergency Response Plan (PFEER+OPEP) descriptions – SECEs – Safety and Environmental Critical Elements descriptions – Environmental Information – Well Examination Scheme & Verification Scheme descriptions
• First transitional cases submitted April 2015. Coming in at roughly 10 per month for the next three years. Jointly assessed by DECC and HSE
27 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Major Accidents & Environmental Incidents Major Accident • An event causing, or with significant potential to cause death or serious injury
arising from fire, explosion, loss of well control or release of dangerous substance, major damage to installation structure, plant, loss of stability.
• Any other event arising from a work activity involving death or serious injury to five or more persons
• Failure of life support systems for diving operations in connection with an installation, detachment of diving bell, trapping of a diver in a bell or subsea chamber
• Any major environmental incident resulting from any of the above
Major Environmental Incident • An incident that results in, or is likely to result in significant adverse effects on the
environment in accordance with the Environmental Liability Directive
28 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
New Reporting Requirements - Dutyholders • There are new requirements surrounding what must be reported to regulators:
– All major accidents, or situations where there is an immediate risk of a major accident – When suitable measures are taken to address a significantly increased risk of a major
accident – On request, when a licensee or operator that is a UK registered company with operations
outside the EU, details of any major accidents they, or their subsidiaries, have been involved in outside the EU.
• Other new reporting requirements arise from the EU Implementing Regulation and take effect when installations transition to the 2015 Safety Case Regime:
• The EU Implementing Regulation requirements expand what was already required in UK law and makes compulsory, some of what was in the voluntary hydrocarbon release reporting scheme.
29 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
New Reporting Requirements • There are new requirements surrounding what Member States must report to the
European Commission – This involves the type and number of major accidents, and normalised data on reported
incidents. – The purpose is to share information across Member States to learn lessons and prevent
recurrence. – First reporting year is January to December 2016
• HSE and DECC are working to integrate all offshore incident reporting into a single tool for installation owners and operators to use
• The European Offshore Authorities Group (EUOAG) is creating guidance on the reporting requirements
30 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Further Information • DECC and HSE have jointly provided a series of industry briefings - more are
scheduled • Advice is available to companies from DECC and HSE focal-point inspectors • Information is available online at:
The Offshore Directive website http://www.hse.gov.uk/offshore/directive.htm The OSDR website www.hse.gov.uk/osdr
31 Offshore Safety Directive – DECC/HSE Presentation to OGUK – 19th May 2015
Financial Responsibility Guidelines Update
Mick Borwell Environmental Issues Director
Oil & Gas UK
Financial Responsibility Guidelines Update
Why do you need this information?
• New obligation placed on Member State by the Offshore Safety Directive – Article 4
• Not to grant a licence unless the applicant has adequate provision to cover liabilities, relevant to the area covered by the licence and the particular stage of operations
• Establish that the applicant has sufficient financial resources for the immediate launch and uninterrupted continuation of effective emergency response and subsequent remediation
• Require the licensee to maintain sufficient capacity to cover liabilities
19 May, 2015 34
What is the intent of Article 4?
• To ensure that all relevant offshore operations have sufficient financial support to respond to a major oil spill and to pay for the consequences
19 May, 2015 35
How is OSD transposed in the UK?
• The Offshore Petroleum Licensing (Offshore Safety Directive) Regulations 2015
• Regulation 9
• licensee must make adequate provision to cover liabilities and
• maintain sufficient capacity to meet all the financial obligations which may result from any liability for offshore petroleum operations carried out by operators appointed by it or in respect of it
19 May, 2015 36
How is OSD transposed in the UK?
• Regulation 12 - the licensing authority or the competent authority may require –
• a licensee to provide information relating to compliance with regulation 9 • a requirement to provide information must be made by notice which is in
writing and dated • an information notice must be complied with it or a reasonable
explanation given why the information required cannot be provided
• Regulation 14 - it is an offence, without reasonable excuse, to provide false information in satisfaction or purported satisfaction of regulation 12
19 May, 2015 37
How will a licensee comply with Regulation 12?
• E & A Wells Financial Responsibility Guidelines • Cost of capping • Cost of relief well • Oil spill modelling to assess adequacy of OPOL cover • Demonstration of FR - Certification
• Production Facilities Financial Responsibility Guidelines • Platform production wells; Subsea production wells; FPSOs; Pipelines
19 May, 2015 38
FR Guidelines Review Group - Approach
• Risk based - lower oil spill risk from production facilities - Knowledge of reservoir and flow rates
• No production, no unassisted flow and gas out of scope • Thresholds (Oil or Condensate) • Portfolio approach • Minimising the administrative burden
- declaration rather than certification (Australian model)
19 May, 2015 39
Practical Implementation Proposal
• Platform well less than threshold (bpd) – demonstrate OPOL membership + Relief Well default value
• Subsea well less than threshold (bpd) – demonstrate OPOL membership + Cap default value + Relief Well default value
• FPSO – demonstrate OPOL membership + P&I or CL cover • Pipeline – demonstrate OPOL membership • Platform well greater than threshold (bpd) – demonstrate OPOL membership +
fully costed relief well + use of the FR methodology • Subsea well greater than threshold (bpd) – demonstrate OPOL membership + fully
costed cap + fully costed relief well + use of the FR methodology.
19 May, 2015 40
Who needs to demonstrate FR?
• Article 4 and Regulation 12 apply to licensees
• “Offshore licensee” means a person who holds an offshore licence
19 May, 2015 41
Sub area Operator / Beneficiaries Licence Block Operator Beneficiary 204/20a FOIN Britoil Britoil Marathon Oil West of Shetlands Britoil P556 204/20a LOYAL Britoil Enterprise Oil Middle East Shell UK North Atlantic 204/20a REST Britoil Britoil Shell UK P559 205/25a ALL Shell UK Shell UK OMV (UK) P803 204/25b REST BP Exploration Operating Company BP Exploration Operating Company Marathon Oil West of Shetlands 204/25b RETAINED BP Exploration Operating Company BP Exploration Operating Company Shell UK 204/25b SUB BP Exploration Operating Company BP Exploration Operating Company Enterprise Oil UK Faroe Petroleum UK Marathon Oil West of Shetlands 205/16a ALL BP Exploration Operating Company BP Exploration Operating Company Shell UK 205/21b BP Exploration Operating Company BP Exploration Operating Company Shell UK
19 May, 2015 42
Who needs to demonstrate FR?
• Article 4 and Regulation 12 apply to licensees
• “Offshore licensee” means a person who holds an offshore licence
• Approx 56 ‘sub-area operators’;
• 425 oil sub areas; 94 condensate sub areas
19 May, 2015 43
Sub area Operator / Beneficiaries Licence Block Operator Beneficiary 204/20a FOIN Britoil Britoil Marathon Oil West of Shetlands Britoil P556 204/20a LOYAL Britoil Enterprise Oil Middle East Shell UK North Atlantic 204/20a REST Britoil Britoil Shell UK P559 205/25a ALL Shell UK Shell UK OMV (UK) P803 204/25b REST BP Exploration Operating Company BP Exploration Operating Company Marathon Oil West of Shetlands 204/25b RETAINED BP Exploration Operating Company BP Exploration Operating Company Shell UK 204/25b SUB BP Exploration Operating Company BP Exploration Operating Company Enterprise Oil UK Faroe Petroleum UK Marathon Oil West of Shetlands 205/16a ALL BP Exploration Operating Company BP Exploration Operating Company Shell UK 205/21b BP Exploration Operating Company BP Exploration Operating Company Shell UK
19 May, 2015 44
Who should demonstrate FR?
19 May, 2015 45
When does this need to happen?
• Article 41 • Member States shall bring into force the laws, regulations, and
administrative provisions necessary to comply with this Directive by 19 July 2015.
• In relation to owners, operators of planned production installations and operators planning or executing well operations – application by 19 July 2016.
• In relation to existing installations – application from the date of scheduled regulatory review of risk assessment documentation and no later than by 19 July 2018.
19 May, 2015 46
The Offshore Petroleum Licensing (Offshore Safety Directive) Regulations 2015 Regulation 15 Where an installation was a planned installation on 20 July 2013, these regulations apply to and in respect of operators in respect of such installations and their connected infrastructure, from 19th July 2016
These regulations apply to operators of installations [and their connected infrastructure] which commenced operations before 20th July 2013, from the earlier of – (a) the date of thorough review or (b) 19th July 2018
19 May, 2015 47
Financial Responsibility Guidelines Review Group
• Shell • ConocoPhillips • BP • Chrysaor • NexenCNOOC • OPOL • OGUK
19 May, 2015 48
Morning Panel Session
Tony Hetherington, HSE Wendy Kennedy, OBE, DECC Mick Borwell, Oil & Gas UK
Drilling Contractors Perspective
John Atkinson Regional Director North Sea
IADC
19 MAY 2015 Aberdeen
EU DIRECTIVE SEMINAR Drilling Contractors Perspective
Views on Directive 2013/30/EU Consultation Members generally supported the intent of the Directive. Did not support the proposed DECC/HSE partnering arrangement to cover the CA – supported stand alone. Greatest concern lay with the proposed OPEP regime. No major issue with the concept of SEMS – however change from SCE’s to SECE’s was viewed with suspicion. (Concern on ECE “creep”)
Possible inclusion of MODU Owners in worldwide major accident reporting structure. Transitional Provisions – we initially and still believe the transposition of the EU OSD Article 42 (1) and (2) is flawed. NPI MODU’s have to comply by July 2016 Installations by July 2018 (Unless next thorough review is due before those dates).
Response to Consultation Document Whilst we accept the proposed amendments to the OPRC Regulations faithfully copy out the requirements of the Directive there is confusion in its application in the draft SCR 2015. Such ambiguities lead to concerns amongst owners of NPI’s that liability for environmental damages will in part be ascribed to them, which we do not believe is the intent of the Directive.
Extract from EU OSD Article 7 “Without prejudice to the existing scope of liability relating to the prevention and remediation of environmental damage pursuant to Directive 2004/35/EC, Member States shall ensure that the licensee is financially liable for the prevention and remediation of environmental damage as defined in that Directive, caused by offshore oil and gas operations carried out by, or on behalf of, the licensee or the operator.”
5
Extract form EU OSD Article 3.2 “Member States shall ensure that operators are not relieved of their duties under this Directive by the fact that actions or omissions leading or contributing to major accidents were carried out by contractors.” IADC is strongly against any prospect of liability for pollution from wells by or through any means shifting from licensees or operators towards drilling contractors (Owners). The established status quo must prevail or drilling becomes non-viable 5
Rationale • Drilling contractors day-rate (market price) is actually
premised on the understanding of apportionment of risk. • The operator engages in a drilling activity with the aim of
developing commercial reserves of oil or gas and reaping a
high reward.
• The drilling contractor leases his rig to the operator for a fixed
day-rate, irrespective of the return from the well that is drilled.
• The day rate takes into account of the cost of capitalisation of
the rig, operating costs, and a profit.
5
UKCS OPEP Implementation: Drilling Rig owners original response was to rely on existing SOPEP’s developed to meet the flag state OPRC requirements. It was soon evident owing to flag and coastal state regulatory differences this was not feasible. Therefore IADC NSC members developed a MODU OPEP template with feedback and guidance from DECC. This was shared with all NPI owners.
5
Feedback from SC & OPEP submissions Dates for Material Change SC and OPEP’s appeared to be a lottery rather than a considered plan. Some confusion where to submit the various submissions. Members submitting material changes were also requested to submit full drawing inventory via portal although nothing had changed from last submission. Obtaining internal CMAPP approval/agreement biggest issue to date – particularly with non UK based HO.
Timing/transition issues – particularly with OPEP’s Scenario 1 – MODU has an approved OPEP under the new system but Installation is not required to have a revised OPEP to take account of the changes for some time. TOOPEP or CIP issue. Scenario 2 – Installation has brought forward its revised OPEP however MODU is not required to have a submitted OPEP before some time in mid 2016 based on submission date. MODU OPEP issue.
Throughout the whole transposition exercise to date - there has been good communication and openness between the two regulators (now the OSDR) and industry and also within the industry organisations themselves. It is recognised a number of initial concerns were not helped by the tight timescale imposed on the regulators to lay the regulations before parliament. Issues do however remain – we just need to solve them.
2015 EU Safety Directive – IADC NSC OPEP
Derek Hart Regional Director North Sea
IADC
2015 EU SAFETY DIRECTIVE – IADC NSC OPEP This presentation centres around the 2015 amendment to the Merchant Shipping (OPRC) Regulations 1998 which has resulted in an OPEP requirement for Non Production Installations (NPI’s). The first meeting that we were involved in took place on the 6th October 2014. This was a combined meeting with HSE and DECC outlining the new requirements as they applied to all units. To NPI’S this was a brand new document. Initially available information was in draft form and what we had to go with was the legal interpretation of what will eventually become law. A challenging document to create when you don’t have specific guidelines or legal precedent to work to.
One good thing was the document was rig and not site / location specific and therefore would not require constant review when rigs moved location. The document should therefore remain valid for five years. In order to interpret the regulations and requirements the IADC NSC formed a small work group to analyse the information we had and produce a template. Volunteers were sought and a work group formed with representation from Rowan, Transocean, Awilco and Dolphin. A good cross section from the industry both for jack ups and semi subs. A meeting was held on 17th Dec 2014 and the beginnings of our template were drafted.
Having gone through this exercise I would recommend this method of co-operation across our industry in producing documentation of this nature.
In the past we have typically used professional advisors and possibly overlooked internal employee expertise.
By pooling our knowledge and experience and in co-operation with the regulatory body, DECC, we have not only produced an industry document fit for purpose but have benefited by cross pollination of ideas and methods.
In the directive we narrowed down the applicable items relevant to NPI’s in schedule 2 of the directive. There were 10 requirements we determined we needed to meet:
1 Positions of people authorised to initiate emergency response procedures. This would be the the chain of command with the OIM at the head for all Tier 1 incidents, section 5
2 Positions of people authorised to notify the authorities. For all Tier 2 and 3 incidents reference to the interface documents is required, TOOPEP etc, section 5 and 7
3 Training of key personnel and general exercises.
4 A description of the worst case scenario causing a release of oil to the sea. This was specific to the rig and was therefore the rigs fuel oil inventory. The operators OPEP covered the well.
5 Arrangements for limiting risk to the environment. Here we covered the SECE’s, the performance standards for the rig, rig specific procedures and equipment available onboard, ICP, section 9
6 Demonstrate an awareness of oil spill response equipment available through OGUK and reference the operators OPEP and the TOOPEP. No inventory on the rig but an awareness of the equipment on the standby vessel and it’s use. Also the reference to the operators field OPEP/TOOPEP/CIP for Tier 2 and 3, section 10,11
7 Demonstrate that the oil spill response effectiveness will be included in the relevant field OPEP or TOOPEP. Reference is made to this in section 11 and includes weather, sea state, hours of daylight, etc
8 The OPEP must include reference to location specific information relating to dispersants detailed in the field OPEP or TOOPEP. This is covered in section 11
9 The OPEP needs to identify the measures to reduce or offset the potential effects resulting from a release of oil and the environmental impact of the release including modelling will be referenced in the field OPEP or TOOPEP. Section 11
10 It needs to contain a contact directory and detail the reporting arrangements. Table of contents in section 7
IADC NSC MODU OPEP Elements: 1. Abbreviations & Definitions 2. Introduction 3. Scope 4. Unit Particulars including fuel inventory 5. Personnel Arrangements for Emergency Response 6. Environmental Emergency Response
Training and Exercises 7. Communication and Interface Arrangements 8. Identification of Worst Case Scenarios 9. Arrangements for Limiting Risks to the Environment 10. Description of Spill Response Equipment &Resources 11. Spill Response Effectiveness Appendix 1. Legislative Compliance Matrix
OGUK – OSD Seminar An Operators Case Study
Ian Mclean Operations Authority
BP
OGUK – OSD Seminar An Operators Case Study Ian McLean
OSD – what is different?
73
• New:
− Corporate Major Accident Prevention Policy
• Merging of safety & environment:
− Safety & environmental management systems
− Major hazard assessments to consider environmental impacts
− Internal Emergency Plans = PFEER + OPEPs (which need revising)
− Safety & Environmental Critical Elements (SECE’s)
• Other:
− Incident Reporting - implemented through EU Regulations
− Changes to Well Notifications & Examination
The ETAP Safety Case
74
• Thorough review date is September 2015
• Revised Case being submitted 1st June to comply with transitional arrangements
• Early draft prepared and shared with the CA to:
− “test” our understanding of the changes
− opportunity for CA to trial their draft “assessment templates”
Changes to Existing Safety Case
75
• Management description updated to include environment – (we have an integrated management system) and other additional information
• Added summary of the receiving environment from existing environmental information
• Linked major accident assessments with potential significant environmental impact identified in our OPEP
• Confirmed the list of SECEs does not change from existing SCE list –performance standards need to be revised to address environmental aspects
• Detailed review of all sections to ensure continuity.
Corporate Major Accident Prevention Policy
76
• Our current CMAPP, developed for COMAH, was not OSD compliant
• Created a new document from relevant extracts from our Operating Management System - existing requirements presented in different format
• It is more detailed than our HSE Policy
• Applies to BP Exploration & Operating Company Ltd operations
CA Feedback
77
• It was a “light touch” review
• No significant issues around the approach we had adopted
• Electronic download worked well for them
• Comments mainly around presentation and level of detail
Going forward
78
• Recognise that Safety Cases are not prepared solely for Regulators – they are also management and workforce references.
• Learn from early Safety Case experience that too much detail devalues the document.
• Apply ALARP type thinking and acknowledge we may not get it all right first time round.
Other OSD Requirements
79
• Well Examination & Well Notifications - new requirements with potential to impact schedule, for example:
− Notification to include “Examiners” comments and “Operators” response
− Material changes programme need to be reviewed by “Examiner” before implementation
• New EU Incident Reporting Regulations - similar to existing RIDDOR but with more detailed reporting requirements
UKCS Multiple Operators – Changes in Environmental Responsibilities
Simon Miller UK HSEQ Senior Manager
Wood Group PSN
UKCS Multiple Operators – Changes in Environmental Responsibilities Simon Miller UK HSEQ Manager
Yet more change…….
• Amber Rudd – new Secretary of State for Energy & Climate Change.
Outline
• The outsourced duty holder business • Overview of changes in OSD • The management of Safety • Environmental management
Service & Capabilities S
Development Project Engineering and Construction Operations and Maintenance Duty Holder Major Brownfield Projects
Decommissioning
Capabilities
Flexible Service Levels
OSD Negotiations Through 2014
• July 2013 – EU OSD adopted • May 2014 – Duty Holder questions raised
– Considered opinion to adopt a single operator model – Major challenges for the outsourced providers.
Safety & Environmental Considerations
• Until July 2015 there has been clear separation of environmental responsibilities and health and safety responsibilities
• Under OSD, that separation no longer exists
• DECC also considers it essential to establish clear lines of responsibility for both environmental and health and safety matters.
The Options
DECC provided an overview of three operatorship options: • Single operator model • Multiple operator model in which responsibility for OPEPs
etc. would be transferred to the entity responsible for undertaking the operations covered in the plan.
• Multiple operatorship model and retention of the status quo for environmental submissions.
Outcome
• The single operator model was not deemed acceptable to the oil and gas industry.
• Advice from the European Commission provided reassurance that a multiple operatorship approach was acceptable, however option 3 was also discounted.
• October 2014 – consultation concludes, multiple operators accepted
Assurance of your operator?
•Regulation 5
Operations Excellence - Objectives HSE • Protect the health of people impacted by our work • Deliver operations and services in ways which prevent incidents and injuries • Minimises adverse environmental impact Assure Asset Integrity and ensure process safety Safely deliver Production targets Deliver world-class Maintenance performance Optimise operating Cost
HSE Determine long term strategies
Plan, Schedule & Execute Analyse short term performance
Analyse longer term performance trends & process improvements
• Safety Case
• Safety Management Systems
•Behavioural Safety Stds
•Aligned with Industry
• Emergency Response
• HSE Plan
• Peer Reviews
• Reporting systems
• Impact
• Incident investigation
• Audit
• Incident Review Panel
• Lessons Learn
• Knowledge Network
Determine HSE
Strategies
Determine & Develop HSE Programme
Execute HSE Tasks
Analyse Performance
HSE Performance
Review
Process Review & Improve
Environmental Management System (EMS) • If the Installation Operator is an existing HSE ‘Duty Holder’, DECC will accept them as
Installation Operator for environmental permitting.
• Environmental competency of these duty holders will not be reviewed.
• However, existing duty holders will need to demonstrate they have an EMS which meets the OSPAR requirements (by holding ISO14001) or through verification.
Permitting requirements of the OSD Installation Operator
• EIA Production Direction • EIA Production Increase Direction • EIA Deposits Direction • Chemical Permit • Oil Discharge Permit • IED (PPC) Combustion Permit • EU ETS Permit • Marine Licence • Consent to Locate • Disturbance Licence • Installation OPEP • Radiation
Permitting & Reporting
The named Installation Operator on the permit will be required to carry out any reporting, including PON1, 2 and 3 reporting.
Under PON1 the spill will be assigned to the installation, i.e. the installation operator needs to consider reputational and liability impacts.
Activities which do not require permits e.g. bunkering will also be the responsibility of the installation operator.
Well notifications through WONS, venting and flaring consents will remain the responsibility of the licence operator
OPEP – What has changed?
OPEPs – What has changed?
• Non-Production Installation OPEPs • Response equipment inventory and effectiveness • Who needs an OPEP (Well Operator, Installation Operator / Duty
Holder) • OPEP naming conventions (offshore, onshore, consolidated, temp
ops, comms and interfaces) • Spill modelling requirements • Dispersant standing approvals • Review timeframes • DECC administration process
OPEP Summary
• For a production installation/field the Installation Operator has the responsibility of submitting the OPEP
• Also responsible for any communication / interface plans • Tiered response arrangements. • OPEP requires to be submitted at the same time as the
Safety Case. • Full review required every 5 years.
What has changed?
• While previously DECC had the power to take action
against a third party DH for pollution incidents, the reality was that the licensee would be the primary contact.
• The default position is now expected to be that as the permit holder, the DH will now be the primary contact for possible enforcement action.
Multiple Operator RACI Chart
The Question of Liabilities?
• Through interface documents and commercial agreements it is possible to ensure that liabilities are sufficiently covered by the licensee group.
Summary
• Multiple operators are recognised • Single Installation Operator • Environmental permitting now the responsibility of
the Installation Operator • Ultimate liability rests with licence holder
Afternoon Panel Session John Atkinson, IADC
Derek Hart, IADC Ian Mclean, BP
Simon Miller, Wood Group PSN
Forthcoming Events – 2015 21 May Training Course: Supply Chain Solutions (Aberdeen) 02 June Aviation Seminar (Aberdeen) 17- 18 June The Oil and Gas Industry Conference (Aberdeen) 30 June Oil & Gas UK Members Speed Networking (London) 30 June Supply Chain Seminar (Aberdeen)
