Energy Voice

North Sea safety: back off Brussels

Jeremy Cresswell, 25th October 2011

OH DEAR, the meddlers at the European Commission are at it again . . . planning a raft of new rules and regulations without taking proper account of what is already in place.

I am of course referring to safety in the offshore oil and gas industry.

While the basic reasons behind the European Commission’s proposal . . . nay, intention . . . to bring in a new law designed to ensure that companies seeking out and producing oil and gas in EU waters “respect the world’s highest safety, health and environmental standards everywhere”, are laudable, it appears that the UK’s regime is neither properly understood nor respected by the Brusselocrats.

Of course we need to prevent accidents like Deepwater Horizon in the Gulf of Mexico from happening and of course it is essential to ensure that best industry practices are followed, but the kind of semi-prescriptive blanket approach that may be imposed is not the way to go.

Environment Commissioner Janez Potocnik said in a statement launching the intended pan-EU regime: “We have learnt our lessons from last year’s Deepwater Horizon accident.”

Really? Who are “We”?

For sure the UK industry, by far the biggest in the EU, paid close attention to what happened in the US Gulf of Mexico . . . hence the Oil & Gas UK-led OSPRAG initiative that so quickly came up with both procedures and hardware designed to handle a potential major loss of hydrocarbons via an out of control well underwater.

This to me . . . and I’ll stake my reputation on this . . . is a measure of how responsive the UK industry has been since the appalling Piper Alpha disaster of 1988 when 167 offshore personnel perished.

For those readers unfamiliar with the aftermath of Piper Alpha, this led to the so-called Cullen Inquiry out of which came a raft of recommendations, the bulk of which were adopted by the industry, including a considerable emergency response capability.

Crucially, the responsibility of safety was wrested from control by the then Department of Energy and placed with the Health & Safety Executive, and there was a switch from prescription to goal-setting.

The solution was not a perfect one and, despite initiatives such as Step Change, the UK’s offshore industry has failed to achieve its zero incidents objective and there are occasional losses of hydrocarbons to the environment.

Not only that, there is far from sufficient transparency with regard to hydrocarbon spills, either by the industry or the authorities.

But the UK’s offshore industry continues to work the challenges proactively and in close co-operation with the HSE, Department of Energy & Climate Change and other stakeholders. I hardly think that a further imposed and very expensive layer of Brussels bureaucracy is going to help.

Incidentally, the Macondo disaster revealed how little attention was paid to Piper Alpha and the Cullen recommendations by the Americans. Witness the hurried overhaul of the government body that for so many years oversaw activity in the US Gulf of Mexico, including splitting responsibility for safety away from the core authority. That should have been done many years ago.

I believe that there are other EU member states that could and should learn from the UK model and I think the blundering manner in which Potocnik launched the Commission’s proposals spectacularly failed to acknowledge the responsive and responsible UK model as an examplar . . . which it undoubtedly is.

He claims that the Commission’s intended approach will lead to a European risk assessment regime that upgrades continuously and that it “introduces requirements for effective prevention and response of a major accident”.

The UK system is all of that and very good, flawed though it might be. Remember, it responded to Macondo of its own accord.

Some key points of the EU plan:

o Licensing authorities in the Member States will have to make sure that only operators with sufficient technical and financial capacities necessary to control the safety of offshore activities and environmental protection are allowed to explore for, and produce oil and gas in EU waters. We already do that.

o Independent verifiers: the technical solutions presented by the operator that are critical for safety on the installation need to be verified by an independent third party prior to and periodically after the installation starts into operation. We already do that . . . it’s the HSE.

o Companies will have to prepare a Major Hazard Report for their installation, containing a risk assessment and an emergency response plan before exploration or production begins. We already do that via safety cases.

o Inspections Independent National Competent Authorities responsible for the safety of installations, who will verify the provisions for safety, environmental protection and emergency preparedness of rigs and platforms and the operations conducted on them. Again, that’s the HSE though it could benefit from some Norwegian nous.

o

All in all, I can see a very expensive, bureaucratic muddle emerging from this. Indeed safety could be rendered into a dangerous farce, just like the EU’s finances. A pity.

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