Enforcement Policy
Offshore oil and gas exploration is one of the most capital and human resource intensive industries. Significant health and safety (H&S) risks are associated with working in offshore oil and gas fields. Dermatitis, inhalation of hazardous substances, mental and physical health, isolation, injury, and loss of life and common H&S risks associated to offshore operations. Bureau of Safety and Environmental Enforcement (BSEE) is the federal regulatory body that regulates offshore oil and gas operations for health, safety, and environmental protection. Safety and Environmental Management System (SEMS) program is the fundamental regulatory framework that is implemented by BSEE. The SEMS regulation has outlined many regulatory requirements related to H&S of employees and safe operations in offshore oil and gas industry. BSEE is also vested with enforcement authority within a broad framework that allows the regulator to issue non-compliance notices to operators, initiate probationary and disqualification procedures, and impose civil penalties. The paper briefly explains relevant issues of SEMS program.
Introduction
The U.S. meets significant portion of its energy demand from oil and gas reserves situated at Gulf of Mexico, Alaska, and Pacific. There are high stakes involved in oil and gas industry, both financially and strategically. Major risks are faced by those directly working at offshore exploration sites of gas and oil sites. Health and safety of workers at rigs, well-heads, and key operational sites remain challenging task for exploration companies and regulatory bodies. The remoteness of sites where these employees work is a significant barrier to providing an assisted backup medical and safety service. The locational barriers arise from exploration wells being areas such as deep-water locations ranging from Arctic to tropical weather conditions. Many hazards such as physical, chemical hazards, ergonomic hazards, and psychological hazards pose serious threat to health of employees working at off-shore oil and gas exploration sites. International Labor Organization (ILO) identified these hazards some 20 years ago and since then, employers along with state and federal governments are expected to minimize and mitigate health-safety risks in the sector. Various chemical hazards include exposure to hydrogen sulphide, wielding fumes, acids, and chemical coatings. Mechanical hazards involve exposure to heavy machinery in off-shore sites. Physical hazards are those related to thermal extremes. Psychological health hazards are those that emancipate from working in isolation and for long hours (Gardner, 2003).
The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE), formed in 2011 after the fateful incident of death of 11 workers at April 20, 2010 in Mobile Offshore Drilling Unit (MODU) at Deep water Horizon. This resulted in oil spill at Macondo well managed by British Petroleum (BP) in the Gulf of Mexico. Bureau of Safety and Environmental Enforcement (BSEE) and Bureau of Ocean Energy Management (BOEM) were formed after devolving BOEMRE. Regulations and enforcement policies and programs are devised and implemented by BSEE. Lately, there has been much criticism over BSEE’s role in minimizing the role of Coast Guard (CG) and Organization of Health and Safety (OHSA) to monitor and regulate offshore oil and gas industry compliance with health safety requirements of employees. The major field in which BSEE is expected to ensure compliance and initiate enforcement proceedings is the Safety and Environmental Management System (SEMS). In order to mitigate health and safety risks associated with offshore oil and gas exploration activities, SEMS program is an industry-wide process safety standard to address the issue. It was initially developed by oil and gas exploration industry as Safety and Environment Management Program (SEMP) in 1993, also published by American Petroleum Association (API) in 2004 under the same title. Following is an overview and requirements of the program.
Health risks
Several health risks have been long identified and associated with the working condition at offshore sites of oil and gas reserves. Inhalation risks arising from hazardous substances are the most obviously reported incidents of health risks. Dermatitis is also another major health risk posed to the personnel working in the wells and at rigs of oil and gas fields. Due to the nature of structures established at oil fields and rigs, noise and vibration related harm to the hearing ability of personnel have also been widely reported (Gardner, 2003). Physical health along with psychosocial well-being of offshore workers is also said to have negative impacts if Health and Safety (H&S) is neglected on these sites (Ross, 2009). Atkinson, et al. (2008) conducted an empirical research on shift workers and concluded that shift work generally decreases opportunities of ‘physical exercise’. This is specifically true for offshore oil and gas industry workers and this negatively impacts their physical and mental well-being. The risk to health and safety of offshore oil and gas industry workers is a universal challenge (Mearns & Yule, 2009) not just that of U.K and the U.S.
Overview and requirements of SEMS
Safety and Environmental Management Program (SEMP) is broad framework that can be used by offshore oil and gas exploration companies to ensure compliance with optimal standards of safety of workers as well as field operations. The program pertains to safety in oil, gas, and sulfur operations in outer continental shelf (OCS). The SEMS regulation adopted in 30 CFR 250 by BSEE, areas covered to apply are well work-over, drilling, construction, Department of Interior (DOI) pipeline services, well servicing, and well completion (AcuTech, 2012). The program outlines operating and design requirements followed by a hazards analysis guideline. The BSEE SEMS regulation adopted in 2010 makes it mandatory for oil, gas, and Sulfur exploration firms to entirely adopt the 2004 publication of API “Recommended Practice for Development of a Safety and Environmental Management Program,” reaffirmed in 2008 (API, 2012).
The general requirements of SEMS relate to well and rig lessees, operating owners, contractors, and sub-contractors. By virtue of SEMS program, all contractors and subcontractors of operating owners are tasked to maintain safety policies and procedures in written format at all times of operations. Foremost in the general requirements is the provision of best available and safest machinery use for drilling purposes. During the process of drilling, monitoring and evaluation of the process needs to be carried out to ensure that oil or gas well does not kick or flow. It is also a general requirement for operating oil and gas wells that the owners must “assess, address, and manage safety, environmental hazards, and potential health impacts during i) design ii) construction iii) start-up of operations, monitoring, and maintenance of all facilities. A person as representative of i) lessee ii) or operating owner iii) or contractor iv) or sub-contractor shall at all times be present to fulfill the responsibilities established virtue of SEMS program. In context of rig and well operations, the general requirements guide the operator/concerned executor that unless the drilling site is secured with bridge plugs, blowout preventers (BOPs), and cement plugs, adequate human surveillance should be maintained by deploying tool pusher or operators representative at rig floor. Subpart O of the SEMS regulation was made mandatory to follow for training of deployment staff at the rig floor. Maintenance of i) materials and ii) equipment for personnel security and safety is also recommended (“Code of Federal Regulations,” 2012). During maintenance or securing procedures, application of down-hole safety devices was also required from the operators. Drilling should be interrupted if any of the following event takes place i) Evacuation of crew ii) Rig location displacement iii) repair or maintenance of rig. It was also required of the operating entity to report to the district manager regarding arrival of MODU on site, movement of platform rig, and departure of MODU amongst many other sub-requirements. Form BSEE — 0144 was to be used for MODU movement intimation in GOM: OCS region (“Code of Federal Regulations,” 2012).
Definition of roles and responsibilities
Director: Director of Bureau of Safety and Environmental Enforcement (BSEE) of the U.S. Department of Interior or a person authorized to act on behalf of director. The director is responsible for overall execution of BSEE operations in outer continental shelf (OCS). Director is also responsible for preventing injury or loss of life from exploration operations. Cooperation and consultation with affected states is also part of Director’s on job responsibility.
Regional Director: A person that is an officer of BSEE holding the authority/responsibility for a region within the jurisdiction of BSEE. The regional director is responsible for executing policy and strategies under the supervision of Director of BSEE. The regional director directly reports to the director. District Manager: A person that is an officer of BSEE and holds authority/responsibility over a district within the jurisdiction of BSEE. DM holds the responsibility to ensure compliance with BSEE regulations including site operational requirements, specifically SEMS regulation. Operator: It may be an individual, firm, Corporation, or/and partnership that controls whole/part of management of leased portion of oil and gas exploration in OCS. The operator may also be BSEE or BOEM approved agent of Lessee or holder of operating rights in the leased part. The major responsibilities of operator include the management of operations at wells, rigs, and offshore jurisdictions leased by the operator. Lessee: A person, corporation, or executive entity that holds the right of ownership under a lease agreement duly signed with United States Government (USG) and pays royalty against the lease agreement to USG. The lessee’s responsibilities include meeting performance metrics related to SEMS regulation as outlined by BSEE. Personnel: Employees that are directly hired labor (directly refers to source of compensation rather than hiring) of operator and contracted labor. The responsibility of personnel is to comply with the workplace health and safety regulation to which they acquainted by management. They are obliged to participate in all mock exercises for safety including training (“Code of Federal Regulations,” 2012).
Regulatory requirements
The regulatory requirements as outlined in the SMEE under the Safety and Environment Management System (SEMS) program pertain to approximately 14 titles of business related to oil, gas, and sulfur operations in OCS. Title 30 part 250 explains are the regulatory requirements with minute details as well. Following are main sections covered in the regulatory requirements SMES framework.
General requirements: These are related to tasks and elements that are dedicated to the organizational management, definition of roles and responsibilities, training, expertise, and SMES framework related requirements.
Safety and environment: The regulatory requirements related to safety and environment obliges operators to compile, obtains, and maintains written format of policies and regulation of safety and environment. Design, construction, and operation of the well/rig are defined under the section.
Hazards analysis: Nov 2011 has been established as the deadline for performing hazard analysis by all operators. Job Safety Analysis (JSA) is the core part of this requirement.
Operating procedures: Based on core subjects of process safety requirements, the requirement sets out the minimal acceptable conditions during the course of operations at well and rig.
Change management: This explains how the firms are required to manage the change from existing systems and procedures to the new procedures and regulations as lay out in the SEMS program.
Quality Assurance and Mechanical integrity: In order to ensure that all critical equipment used by the personnel is not harmful to be used, posing threat of injury or loss of life, the requirement outlines how companies should ensure that no toxic materials are released during operations that can have safety impact for personnel or environmental impacts. Pre-start up review, Emergency response and control, investigation of incidents, SEMS audit requirements, and documentation requirements are other main section that are covered by the regulatory requirements of SEMS program.
Enforcement options
Issuance of non-compliance notices: After repeated monitoring and checkup visits by the district manager, if an operator is found not meeting the minimum general and specific requirements set out in SEMS regulation, the regional director can issue incident of non-compliance notice to the operator. Initiation of probationary procedures: The option allows the BSEE with authority to start probationary proceedings against an OCS operator for failing to respond to the ‘incident of non-compliance’ notice or failing to satisfy the regulatory requirements. Initiation of disqualification proceedings: Though rarely used, BSEE is vested with the authority to initiate disqualification proceedings against an operator of OCS that fails to satisfy the regulatory framework performance metric. Civil Penalties: The BSEE regional manager can initiate proceedings to invoke civil penalties against an operator failing to meet minimum standards as set out in the SEMS regulation (AcuTech, 2012).
Cost of implementation, training, and advantages of SEMS
Training requirements are also set by the SEMS program and the regulation by BSEE sets out the minimum standards expected of the operator. Whereas most of the requirements oblige operators/license holders to comply with the regulatory framework, the training requirements make it mandatory for operators and personnel to undergo training. Ensuring mechanical integrity and preparing emergency response elements is essential for employees as well. Irrespective of the fact that employees work on platform or not, the training requirements shall be met. In 1994, Taylor Energy Company (Taylor) and Paragon Engineering Services, Inc. (Paragon) were tasked by the mining and minerals agency of the U.S. To investigate and report the implementation and costs of adopting the proposed regulatory framework previously known as Safety and Environment Management Program (SEMP). The results reported displayed that significant time, cost, and management is required to adopt the SEMP (later SEMS) regulatory framework (Hoyle & Dykes, 1997). Yule, Flin and Murdy (2007) have correctly argued that operator’s management team can assess and rectify potential health and safety hazards on the oil and gas fields, more effectively than others.
Conclusion
Offshore oil and gas exploration involves such working conditions that are isolated and it is not feasible to obtain and maintain highest quality of data related to health and safety risks posed by the environment in which employees work. However, many researchers have investigated the adverse impact that such isolated conditions create on the health and safety of workers. Dermatitis, noise and vibrations, contamination from chemicals, inhalation of hazardous substances, injury from carrying heavy materials, and loss of life are not uncommon the industry. Bureau of Safety and Environmental Enforcement (BSEE) is the federal regulatory agency that regulates OCS vicinity for health and safety risks posed by offshore oil and gas exploration. Safety and Environment Management System (SEMS) program is the regulatory framework to which offshore oil and gas industry is required to comply with. There are many requirements set out in the SEMS regulation such as general requirements, Safety and environment, Hazards analysis, operating condition requirements, and quality assurance. Enforcement tools available to BSEE are also exercised in case those regulatory requirements are not met by the operators.
References
AcuTech. (2012). Safety and Environmental Management Systems (SEMS) Background Summary. AcuTech Consulting Group. Retrieved from: http://acutech-consulting.com/pdfs/AcuTech-White-Paper-SEMS%204-17-12.pdf
API. (2004). Safety and Environmental Management Program (SEMP) Promotes Safe and Environmentally Sound Operations Offshore. American Petroleum Association. Retrieved from: http://www.api.org/oil-and-natural-gas-overview/exploration-and-production/offshore/exploration-management.aspx
Atkinson, G., Fullick, S., Grindey, C., Maclaren, D., & Waterhouse, J. (2008). Exercise, energy balance and the shift worker. Sports medicine (Auckland, NZ), 38(8), 671. Retrieved from: http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2784228/
“Code of Federal Regulations.” (2012). Para 250 Oil, Gas, and Sulfur operations in the Outer Continental Shelf [30 CFR 250]. Retrieved from: http://cfr.regstoday.com/30cfr250.aspx#30_CFR_250p200
Gardner, R 2003. Overview and characteristics of some occupational exposures and health risks on offshore oil and gas installations. Annals of Occupational Hygiene, 47(3), 201-210. http://annhyg.oxfordjournals.org/content/47/3/201.long
Hoyle, J. & Dykes, J. (1997, May). Safety and Environmental Management Program (SEMP) Case Study. In Offshore Technology Conference. Retrieved from: http://www.onepetro.org/mslib/servlet/onepetropreview?id=OTC-8365-MS
Mearns, K., & Yule, S. (2009). The role of national culture in determining safety performance: Challenges for the global oil and gas industry. Safety Science, 47(6), 777-785. Retrieved from: http://www.gruppofrattura.it/ocs/index.php/gigf/gigf1996/paper/viewFile/668/470
Ross, J.K. (2009). Offshore industry shift work-health and social considerations. Occupational medicine, 59(5), 310-315. Retrieved from: http://occmed.oxfordjournals.org/content/59/5/310.full
Yule, S., Flin, R., & Murdy, A. (2007). The role of management and safety climate in preventing risk-taking at work. International Journal of Risk Assessment and Management, 7(2), 137-151. Retrieved from: http://betsie.aberdeen.ac.uk/cgi-bin/betsie/0005/www.abdn.ac.uk/iprc/documents/The_role_of_management_and_safety_climate_in_preventing_risktaking_at_work.pdf
