ENERGY LAW

Lecture 3: Regulating Safety in Petroleum Exploration and ProductionDr Tina HunterReader in Energy Law, University of Aberdeen; andAssociate, Aberdeen University Centre for Energy LawJUS271A Energy LawReadingOffshore Safety: The European Commissionss legislative initiatives, Greg GordonSafety regulations and guidelines Norwayhttp://www.psa.no/pdfs-of-regulations/category934.html Safety in the UK http://www.hse.gov.uk/offshore/ Regulatory areasSTAGES OF PRODUCTIONACCESS PETROLEUM EXPLOITATIONLCSEXPLORATION AND DEVELOPMENT(L2)or PRODUCTION: SAFETY IN EXPLORATION AND PRODUCTION (L3)PSCPRODUCTION: REGULATING WELLS IN EXPLORATION AND PRODUCTION (L4)(L1)PRODUCTION:ENVIRONMENTAL REGULATION IN EXPLORATION, PRODUCTION DECOMMISSIONING (L5)What is safety?Keeping people alive!Dont let rigs blow upKeep the environment safeBlurred lines?RiskIdentifying risks, Reducing riskMitigating riskResponding to riskWhy safety?Prevent deathsControl hazards Prevent platforms blowing upPrevent oil spills (environment protection)Reputation Risk management

TYPES OF SAFETYWorker safety (slips, trips and falls)Also known as OHSProcess safetySafety of the facility, design, etcSafety of the processes used on the the rig Well safetyEnsuring that wells are controlled and Types of safety regulationPrescriptive regulation is directionsprescribes every step that is to be done in order to keep the installation safeprescribed by the RegulatorAll ok?Complacency?Objective regulation goal basedGoal is to reduce danger to ALARPRedirects risk and responsibilityThose who create risk manage the risk

Historical development of safetySea Gem 1965Capsized, 13 deadAlexander Kielland - 1980Capsized, 123 deadEkofisk Bravo - 1977Blowout, no injuriesOil spillPiper Alpha - 167Explosion and sinking, 1988

Sea GemConverted barge steel legs and tower added to turn into MODU.Rig legs collapsed causing rig to capsize Men and equipment slid into freezing North Sea No radio message sent as radio tower first part into water13 dead

Alexander KiellandMODU but used as flotel for Edda 2/7COn bracing leg hydrophone added as Storm March 198012 metre waves 40knot windsCapsized as bracing leg collapsed123 dead

Piper Alpha game changerIn North Sea Operated by Occidental P/LFollowed the rules prescriptive regulationMistake in a pump used one that was closed downLife boats, fire fighting system and quartersKept on pumpingHuge loss of life 167 menTransformed regulation to objective based regulationhttps://www.youtube.com/watch?v=pHriwdaEbms

Objective based regulationTHE SAFETY CASE REGIME Meet goals rather than ruleslike court, present a case for the safety of the installationHistory in nuclear industryArose several accidentsAdded issue Well operations management (WOMPs)Concept of ALARPWho uses this? AustraliaUKNorway?

What is the safety case regime?Based on the concept that the responsibility for ensuring the health and safety of offshore operations lies with those that create the risks. Identify the hazardsFormal safety AssessmentQuantitative risk assessmentWhat is the safety case regime?Operator demonstrates that the identified risks have been reduced to ALARPSafety Case is a detailed document prepared by the operator and makes the case that the installation and its operation are safe.BUT what about those things outside of the purview of the SC, but still impact on the facility? Externalities and the SCRLesson from FukushimaWhere SCR aroseDesigned to keep the nuclear facility safeBut did not factor in the impact of externalitiesNine metre tidal wave (designed for a 6-7m wave)Externalities and SCR Well IntegritySCR for platform assesses the platforms design and processesDoes not take into account the well that sits under, and is connected to the platform Standard of well integrity regulated differently and independently Well integrity differs

EU Platform Safety DirectiveSafety of Offshore Oil and Gas Operations and Amending Directive 2004/35/ECSeehttp://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32013L0030&from=EN Designated Offshore Safety Directive regulatorHSE in UK PTIL in NorwayOperates in conjunction with Marine Directive Article 1 - Subject and scope1. This Directive establishes minimum requirements for preventing major accidents in offshore oil and gas operations and limiting the consequences of such accidents.2. This Directive shall be without prejudice to Union law concerning safety and health of workers at work, in particular Directives 89/391/EEC and 92/91/EEC.3. This Directive shall be without prejudice to Directives 94/22/EC, 2001/42/EC, 2003/4/EC (1), 2003/35/EC, 2010/75/EU (2) and 2011/92/EU.PREVENTION OF MAJOR ACCIDENTS RELATING TO OFFSHORE OIL AND GAS OPERATIONS

Article 3General principles of risk management in offshore oil and gas operations1. Member States shall require operators to ensure that all suitable measures are taken to prevent major accidents in offshore oil and gas operations.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.3. In the case of a major accident, Member States shall ensure that operators take all suitable measures to limit its consequences for human health and for the environment.4. Member States shall require operators to ensure that offshore oil and gas operations are carried out on the basis of systematic risk management so that the residual risks of major accidents to persons, the environment and offshore installations are acceptable.SAFETY REGULATION IN NORWAYSafety regulation in NorwaySafety managed by Petroleum Safety Authority www.ptil.no PETROLEUM ACTChapter 9 Special requirements to safety.Section 9-1 Safety.Section 9-2 Emergency preparedness.Section 9-3. Emergency preparedness against deliberate attacks.Section 9-4 Safety zones etc.Section 9-5 Suspension of the petroleum activities etc.Section 9-6 Requirements to safety documentation.Section 9-7 Qualifications.Section 9-1 - SafetyThe petroleum activities shall be conducted in such manner as to enable a high level of safety to be maintained and further developed in accordance with the technological development.

Regulations for SafetyREGULATIONS RELATING TO HEALTH, SAFETY AND THE ENVIRONMENT IN THE PETROLEUM ACTIVITIES AND AT CERTAIN ONSHORE FACILITIES (THE FRAMEWORK REGULATIONS)REGULATIONS RELATING TO DESIGN AND OUTFITTING OF FACILITIES, ETC. IN THE PETROLEUM ACTIVITIES (THE FACILITIES REGULATIONS)REGULATIONS RELATING TO TECHNICAL AND OPERATIONAL MATTERS AT ONSHORE FACILITIES IN THE PETROLEUM ACTIVITIES, ETC. (TECHNICAL AND OPERATIONAL REGULATIONS)Regulations pursuant to the Norwegian Working Environment Act are issued by the Ministry of Labour and enforced by the Norwegian Labour Inspection Authority and ourselves within our respective areas of authority.REGULATIONS RELATING TO MANAGEMENT AND THE DUTY TO PROVIDE INFORMATION IN THE PETROLEUM ACTIVITIES AND AT CERTAIN ONSHORE FACILITIES (THE MANAGEMENT REGULATIONS)Other requirementsGuidelines http://www.psa.no/guidelines/category218.html Standardshttp://www.psa.no/standards/category884.html Risk Managementhttp://www.psa.no/risk-and-risk-management/category897.html Ageing facilitieshttp://www.psa.no/aging-and-life-extention/category1032.html SAFETY REGULATION IN UKRegulation of Safety UKHealth and Safety Executive UKhttp://www.hse.gov.uk/offshore/ Safety Duty under ActHealth and Safety at Work etc Act 1974 (HSWA)Offshore Safety Act 1992 supplements part 1 of HSWAPlus Health and Safety at Work etc Act 1974 (application outside Great Britain)Multiple Regulations see http://www.hse.gov.uk/offshore/law.htm SAFETY REGULATION IN AUSTRALIAOngoing threats to safety Deepwater drillingWell controlAgeing facilitiesEconomic imperatives Cost savingsTime Technology

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IS this a safety or environment issue? What other issues? One last thoughthttp://www.youtube.com/watch?v=HtfevVB5eBk&feature=fvwp&NR=1