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Column: What Is OSHA’s Authority Offshore?

Source: Lifeline Strategies | 28 February 2014

One of the questions I get most often when I teach my workshop on Safety and Environmental Management Systems (SEMS) compliance is whether companies need to follow US Occupational Safety and Health Administration (OSHA) regulations offshore. It is a complex question, because it depends on a confusing interpretation of the law plus the expectations of the oil and gas industry.

Most of the answers are found in an OSHA instruction: OSHA Authority Over Vessels and Facilities on or Adjacent to U.S. Navigable Waters and the Outer Continental Shelf (OCS). The basic rule of thumb on OSHA is that it does not have authority if another agency regulates safety issues. The clearest example is that the Coast Guard regulates inspected vessels, so OSHA does not have authority over them. But, when you look at uninspected vessels (towboats, barges, etc.), it is a lot murkier. The OSHA instruction goes into great detail on how vessel jurisdiction is to be determined.

Whether OSHA regulations apply to offshore facility is a complex one that may be in flux.

Proposed US Energy Rules Would Shield Whales

Source: ABC News | 28 February 2014

Proposed federal environmental guidelines released 27 February would protect endangered North Atlantic right whales from offshore seismic testing aimed at sizing up oil and gas reserves from Delaware to Florida.

The Bureau of Ocean Energy Management outlined that measure and other protections intended to shield marine life if the government allows the testing, which could be a first step in the development of an offshore oil industry in Atlantic waters.

The Obama administration delayed the scheduled leasing of offshore tracts in Virginia and other Atlantic states following the 2010 oil spill in the Gulf of Mexico. The leasing was to begin in 2011 but was pushed back to 2017.

The seismic testing is intended to apply new technology to areas that have not been studied in more than 3 decades, and then with equipment that had limited capabilities to detect energy resources hidden below the ocean floor. The energy industry has said the new, more sophisticated seismic surveys would not only give a better picture of oil and gas deposits but also eliminate areas that should not be drilled.

While the industry estimates that oil and natural gas development in the outer continental shelf would create hundreds of thousands of jobs over the next couple decades, ocean protection groups contend marine life shouldn’t be exposed to a blast zone up 50 miles off the coast. They have pushed for a delay in the environmental guidelines until a key study is completed.

“By failing to consider relevant science, the Obama administration’s decision could be a death sentence for many marine mammals,” said Jacqueline Savitz, vice president for US Oceans at Oceana.

In a statement, BOEM Director Tommy P. Beaudreau said the department is committed to “balancing the need for understanding offshore energy resources with the protection of the human and marine environment using the best available science as the basis of this environmental review.”

EPA Releases Revised Guidance on Use of Diesel Fuels in Hydraulic Fracturing

Source: BakerHostetler via Mondaq | 20 February 2014

On 11 February 2014, the US Environmental Protection Agency (EPA) released its long-awaited revised permitting guidance for wells that use diesel fuels during hydraulic fracturing. The guidance details the EPA’s view on how to implement provisions of the Energy Policy Act of 2005, which amended the Safe Drinking Water Act (SDWA) definition of “underground injection” to specifically exclude the “underground injection of fluids or propping agents (other than diesel fuels) pursuant to hydraulic fracturing operations related to oil, gas, or geothermal production activities.”

EPA Issues Guidelines for Diesel Fuel Used in Hydraulic Fracturing

Source: Platts | 12 February 2014

In a long-anticipated move, the US Environmental Protection Agency (EPA) on 11 February released guidelines for the use of diesel fuel in hydraulic fracturing fluid.

The guidelines bring the agency into compliance with the Energy Policy Act of 2005, the EPA said in a statement. That law, which limited the EPA’s authority to regulate hydraulic fracturing under the Safe Drinking Water Act’s underground injection control program, left the door open for the agency to regulate the use of diesel fuel in hydraulic fracturing.

Environmental groups praised the decision, while exploration and production industry representatives said the guidelines are largely meaningless, as the industry has long since phased out the use of diesel in favor of more sophisticated chemical cocktails.

Nigeria: An Overview Of The Petroleum Industry Bill

Source: Dornim Solicitors And Legal Consultants via Mondaq | 30 January 2014

The Petroleum Industry Bill 2012 (PIB) seeks to ensure that the management and allocation of petroleum resources in Nigeria and their derivatives are conducted in accordance with the principles of good governance, transparency, and sustainable development in Nigeria. The PIB was submitted to the National Assembly on 18 July 2012 and is expected to be deliberated upon and enacted into law in the near future.

European Commission Publishes Guidelines on Shale Gas Exploration

Source: Shale Energy Insider | 28 January 2014

The European Commission (EC) has adopted a recommendation aiming to ensure that proper environmental and climate safeguards are in place for hydraulic fracturing—the high-volume  technique used notably in shale gas operations. According to the EC, the recommendation should help all member states wishing to use this practice address health and environmental risks and improve transparency for citizens. It also lays the groundwork for a level playing field for industry and establishes a clearer framework for investors.

The recommendation is accompanied by a communication that considers the opportunities and challenges of using hydraulic fracturing to extract hydrocarbons. Both documents are part of a wider initiative by the EC to put in place an integrated climate and energy policy framework for the period up to 2030.

EPA Vows Action on Fracturing Rules, Policy

Source: National Journal | 22 January 2014

The Environmental Protection Agency (EPA) is seeking to assure environmentalists that it hasn’t dropped the ball on oversight of hydraulic fracturing.

A letter from EPA Administrator Gina McCarthy to the Natural Resources Defense Council vows the agency will take steps on several fronts to boost the environmental safety of hydraulic fracturing, the oil-and-gas extraction method that is enabling US energy production to soar.

“The EPA is moving forward on several initiatives to provide regulatory clarity with respect to existing laws and using existing authorities where appropriate to enhance public health and environmental safeguards,” McCarthy writes in a 10 January letter.

Federal Board Rejects Safety Recommendations Stemming From Chevron Refinery Fire

Source: San Jose Mercury News | 22 January 2014

In a move described by agency officials as highly unusual, a divided US Chemical Safety Board refused to endorse the centerpiece recommendation from its staff’s 115-page report on the massive Chevron refinery fire in 2012.

At the heart of the split, made public in a packed Richmond City Council chamber, was whether the system for regulating oil refineries should be overhauled to mirror the European model that focuses on continually reducing accident risks, as proposed in the staff report, or whether more emphasis should be placed on strengthening the current oversight system.

The safety board recommendation, which would force the industry to demonstrate that it is operating as safely as possible through written reports reviewed by regulators, has come under fire from industry, the scientific community, and labor and political interests. Many of the concerns center on whether the so-called safety case regime would add unnecessary costs, complexity, and uncertainty to the monitoring of oil refineries and detract from efforts to enhance local and state laws and resources.

“There may be more immediate benefits from beefing up the current system,” said Kim Nibarger, a health and safety specialist for the United Steelworkers. “We don’t want the perfect to be the enemy of the good.”

Officials Call for More Regulations To Prevent Crude Train Accidents

Source: Rigzone | 22 January 2014

US government officials say the series of accidents over the past year involving railcars carrying crude oil highlights the need for greater regulations of crude transportation on railways and more pipeline infrastructure.

US Sen. John Hoeven (R-North Dakota) told Platts Energy Week on 12 January that more pipelines to move Bakken oil from North Dakota to refineries are needed to ease safety concerns after the 30 December rail accident near Casselton in eastern North Dakota, where a BNSF Railway train carrying crude collided with another train, setting off an explosion and fire that prompted the evacuation of 1,400 local residents.

On 13 January, the National Transportation and Safety Board (NTSB) reported that 18 of the 20 tank cars that derailed were punctured and more than 400,000 gallons of crude oil were estimated to have been released. Damage resulting from the accident is estimated at USD 6.1 million.


New Guidelines Seek To Curb Risks to Whales From Seismic Tests

Source: Rigzone | 22 January 2014

Safeguards on seismic testing for an oil and gas project in the Pacific have shielded endangered whales from harm and are a model for managing the deafening blasts, the world’s largest environmental group said on 20 January.

Conservationists working with Sakhalin Energy Investment in Russia from 2006–12 said the tiny population of endangered Western Grey whales had risen approximately 3% a year to 140, despite seismic testing near their feeding grounds.

Seismic testing bounces sound waves into the seabed to seek deposits of oil and gas. It can harm whales and other marine life with blasts of 230 to 250 decibels, so loud that they can sometimes be detected 4000 km away.

“This work helps to set a standard,” said Carl Gustaf Lundin, director of the global marine and polar program at the International Union for Conservation of Nature (IUCN). “Once you have raised the bar … other companies will look bad if they are not deploying it.”

The IUCN includes governments, scientists, and conservation organizations and is the world’s biggest environmental alliance.

UK Government Publishes Regulatory Roadmap for Shale Gas Exploration

Source: Zyda Law via Mondaq | 15 January 2015

The UK government has published a regulatory roadmap that sets out the series of permits and permissions developers need to obtain before drilling for onshore oil and gas, to provide certainty to investors and local communities about what the permitting process entails. In addition, a Strategic Environmental Assessment (SEA) has also been produced by the government by engineering and project management firm AMEC.

The SEA sets out the potential economic and environmental effects of further oil and gas activity in Great Britain, including shale oil and gas production. The assessment was carried out in preparation for the launch of the next round of licenses being made available for onshore oil and gas exploration and production. Two scenarios were measured, a high-activity scenario and a low-activity scenario. The high-activity scenario in the SEA assumes that a substantial amount of shale gas is produced during the 2020s, between 4.32 and 8.64 Tcf, which is up to three times current gas demands in the UK.