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Regulations

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.

Wyoming Again Takes the Lead In Hydraulic Fracturing Regulation

Source: Lewis Roca Rothgerber via Mondaq | 15 January 2014

Wyoming has once again taken the lead in the regulation of hydraulic fracturing. In response to Gov. Matt Mead’s Energy Strategy, the Wyoming Oil and Gas Conservation Commission adopted rules on 14 November 2013, with an effective date of 1 March 2014, requiring companies to perform baseline water testing before and after spudding a well. This testing must be performed within 12 months before spudding a well and twice after setting production casing or liner, once between 12 and 24 months and once between 36 and 48 months. The testing must be performed on wells within a half-mile radius as approved by the commission.

New Regulations for Oil on Rail Cars To Come in 2015

Source: Fuel Fix | 15 January 2014

Regulations that could force oil companies to use stronger rail cars to move crude likely will be ready in 2015, according to a schedule released by the US Department of Transportation.

Oil companies have increasingly used rail cars to move crude, but recent disasters, including a derailment and massive explosions in North Dakota last month, have drawn attention to the cars’ vulnerabilities. New regulations that could force older tank cars to be upgraded or phased out are under development, but will not be proposed until 12 November and will be subject to a public comment period until 12 January 2015, according to the Department of Transportation.

However, that initial timeline could shift as the process continues, said Pipeline and Hazardous Materials Safety Administration spokesman Gordon Delacambre.

EPA To Require Southern California Offshore Fracturing Reports

Source: Rigzone | 15 January 2014

Oil and gas companies that are hydraulically fracturing off the southern California coast will have to report chemicals discharged into the ocean under a new rule released by federal environmental regulators.

The U.S. Environmental Protection Agency published the requirement in the federal register, and it will become effective 1 March. The move comes after a series of stories by The Associated Press last year revealed at least a dozen fracturing operations in the Santa Barbara channel and more than 200 in nearshore waters overseen by the state of California.

Discussion Regarding the Proposed Changes to OSHA’s PSM

Source: OSHA | 30 December 2013

OSHA has proposes to update and expand its process safety management (PSM) standard for the first time since 1992. The agency has put out a request for information, seeking public comments on the proposed changes.

Some general comments to do with the OSHA material include the following:

  • Much of the discussion and justification for changes refer to actual incidents. OSHA seems to be using a case-based approach to process safety.
  • There is considerable cross-referencing to other federal and state standards.
  • It is likely that the number of companies and facilities covered by the standard will increase substantially. Many of them will be small organizations that do not currently have process safety programs.
  • The proposals to do with recognized and generally accepted good engineering practice reflect a healthy focus on engineering.

CSB Proposes Regulation Changes in Wake of Refinery Fire

Source: US Chemical Safety Board | 30 December 2013

In a draft report released to the public, the US Chemical Safety Board (CSB) proposes recommendations for substantial changes to the way refineries are regulated in California. Entitled “Regulatory Report: Chevron Richmond Refinery Pipe Rupture and Fire,” the CSB draft calls on California to replace the current patchwork of largely reactive and activity-based regulations with a more rigorous, performance-based regulatory regime—similar to those successfully adopted overseas in regions such as the United Kingdom, Norway, and Australia—known as the “safety case” system.

The draft report is the second part of three in the CSB’s investigation of the August 2012 process fire in the crude unit at the Chevron refinery in Richmond, California. That fire endangered 19 workers and sent more than 15,000 residents to the hospital for medical attention.