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Implementing the EU Offshore Safety Directive

01 August 2015

The single biggest change to affect UK and EU offshore health, safety and environmental management in many years comes into force this July with the introduction of the EU Offshore Safety Directive. Robert Paterson, Health and Safety Director at the Oil & Gas UK industry association, explains the reasons behind the Directive’s introduction and the key changes and main implications for the oil & gas community.

Q: Why did we have to change what is commonly regarded as a world-class safety regime in the UK?

A: The Deepwater Horizon oil spill in the Gulf of Mexico in 2010 refocused attention on the potential for major accidents and, in particular, major environmental accidents. The European Commission (EC) decided that consistent standards were required for offshore operations across the European Union (EU).

The EC could see that existing regimes had developed in a piecemeal fashion – in the UK after the Piper Alpha incident in 1988 and in Norway after the 1980 capsize of the Alexander Kielland platform. It recognised that many other European countries, like Romania and Cyprus, were at the early stages of offshore development and that there was merit in everyone having a similar approach.

Originally, the proposal was for an EU Regulation, but Oil & Gas UK, in collaboration with others, strongly objected to this – a Regulation would have swept away our entire post-Piper legal framework, which is world-class. Following considerable discussion, the EU decided to adopt a Directive, which enables more flexibility to implement and align the new European requirements with existing UK provisions. The Directive aligns the different major accident hazard regulatory frameworks across Europe with one rigorous regime aimed at further minimising the risks of offshore operations.

 Q: What are the key changes?

 A: There is much in the Directive that the UK industry is familiar with, but there are also a number of important changes. One of the key changes is the creation of a new Competent Authority (CA) – an independent body that provides regulatory oversight of the management of major accident, safety and environmental risks. It is also responsible for implementing the EU Directive.

Other changes include a requirement for each duty holder to have a Safety and Environmental Management System (see box-out right for definition of key terms), a Corporate Major Accident Prevention Policy and for environmental major accident information to be included in the revised installation safety case. Other important measures are to identify safety and environmental critical elements (SECE) and to implement a verification scheme for these.

There are also new stipulations about the liability for environmental damage (see box-out right) and that operators must report a range of new incidents and dangerous occurrences to the CA. For example, any loss or non-availability of a SECE, requiring immediate remedial action, is reportable, or a vessel on a collision course with an installation where operators have to take immediate measures.

Q: Who will form the Competent Authority?

A: The Department of Energy & Climate Change’s (DECC) Offshore Oil and Gas Environment and Decommissioning Team and the Health and Safety Executive’s (HSE) Energy Division will work in partnership to deliver the CA and its functions as required under the Directive. The CA will be known as the Offshore Safety Directive Regulator (OSDR).

Q: What has changed in the reporting of major incidents?

Robert Paterson, Oil & Gas UK Health and Safety Director
Robert Paterson, Oil & Gas UK Health and Safety Director

A: As a result of the Directive, the EC has brought in separate legislation – the EU Implementing Regulation – which requires specific major accident related incidents to be reported. The aim is to ensure consistent reporting across the EU and to enable comparisons to be made between the various Member States. To minimise the reporting burden, the HSE is working to align this requirement with existing measures so that there is a single route for reporting offshore incidents. A subcommittee of the EC – the EU Offshore Authorities Group – is developing guidance.

 Q: Does the Directive mean heavier regulation of industry?

 A: The HSE and DECC have laid out the standards and benchmarks for industry to evaluate compliance with the Directive through a new series of safety case and oil pollution emergency plan (OPEP) guidance templates. We don’t see significant differences in the standards from what companies are already familiar with, and the existing documents have been refined to account for changed regulatory expectations. As the standards by which the CA makes its compliance judgements are similar, we do not expect more heavy handed regulatory oversight.

Q: Do you think implementation of the Directive in the UK will improve standards?

A: A major safety hazard can often have environmental implications so we welcome the integration of safety and environmental risk management. The new incident reporting requirements should also lead to more sharing of information, which can only be positive.

Q: How are the changes viewed by industry?

A: Industry has worked hard with the HSE and DECC to minimise the bureaucracy and facilitate smooth and efficient regulatory change. All parties have been fully engaged to maintain the momentum in developing various regulations and supporting interpretative guidance.

Q: Where are we now?

A: We continue to engage with HSE and DECC on the UK legislative package due to come into force in July. The focus now is to work with the HSE and DECC on preparing the supporting guidance documents and to refine the CA’s administrative arrangements for receiving and assessing safety cases, OPEPs, etc.

Q: What should I be doing next?

 A: The CA has sent all operating companies a letter setting out the timescale for resubmitting safety cases. All safety cases and accompanying OPEP(s) must be resubmitted and re-accepted by the CA by 2016 for existing non-production installations and by 2018 for existing production installations (those that have accepted safety cases on or prior to 18 July 2013).

Definitions and Terms Safety and Environmental Management System

Each duty holder must have a Safety and Environmental Management System (SEMS) that must be clearly described in an associated document. SEMS’ requirements are detailed in Schedule 3 of the Safety Case Regulations 2015.

Whether a duty holder operates its SEMS as separate or integrated, the document should clearly describe the contents of these systems – how they work together and how they integrate into the corporate management system.

Corporate Major Accident Prevention Policy

The Corporate Major Accident Prevention Policy (CMAPP) must be included in a safety case submission. Existing policies will likely need updating to meet the specific requirements of the Safety Case Regulations 2015.

The duty to prepare the CMAPP falls on the legal entity that is the operator or owner in the UK. If the legal entity in the UK is part of a group corporate structure, it is for the operator or owner to decide if they submit a UK company group, or international group, CMAPP. Either is acceptable as long as it meets the requirements of this Regulation and associated Schedules.

Environmental Liability Directive

The Environmental Liability Directive requires the damage caused by a major environmental incident to be remediated and paid for by the company responsible. It previously applied to coastal waters and European Protected Sites, but the EU Offshore Safety Directive extends its application to the whole of the marine environment.

[This article originally appeared in Wireline magazine, published by Oil & Gas UK.]

Hazardex interview - Robert Paterson - EU OSD: Challenges and opportunities

In an interview with Hazardex at Oil & Gas UK’s Conference on June 18, Robert Paterson described the consultation process the industry went through and some of the issues under scrutiny. He expressed satisfaction that the sector had taken on board the implications of the Offshore Safety Directive and thought that the majority of regulatory changes would be positive for the industry.

“We’ve had a high level of engagement from the industry throughout the whole process through regular meetings with HSE and DECC officials, right through to informal consultations when they were drafting their consultative document or proposals. That helped to clarify some of the issues and iron out some of the challenges.

“So we got to a position where there was a formal consultation which ran for two months last year. I think there were 65 formal responses to the consultation and some 30 operating companies were involved, as well as drilling contractors and independent verification companies, as well as the trades unions.

“Overall I think we got out of that pretty much what we wanted. I think our only disappointment was over the Competent Authority – there was a genuine feeling that bringing DECC and HSE together within a single organisation for environmental and health and safety issues would have given an overall benefit. But the government decided that wasn’t going to happen.

“Nevertheless, they agreed to a Memorandum of Understanding to work more closely together with an oversight board to make sure everything is working efficiently through a single portal for submission of safety cases and notifications. So we have a virtual Competent Authority.

“All the major hazard issues will be dealt with through that route, but you’ll still be dealing with DECC entirely separately on environmental matters, chemical permits, and related issues.

“We were very keen to retain the option for the outsourced duty holder model, which is something that has worked under the existing safety case regime in the UK since 1992. We felt that being able to use a Wood Group, AMEC or Foster Wheeler as a duty holder was a way to encourage new entrants to come in with the right financial backing, but then to be able to use the expertise of an outsourced duty holder to manage health and safety and environmental matters on their behalf.

“That was a positive element that came out of the consultation as it wasn’t in the original proposal. So we’re pleased with that outcome.

“The regulations will come into force on the 19th of July. We’ve been through a process of consulting on the interpretative guidance, which will help us mere mortals understand what the lawyers have written!

“That has also gone well – there are just a couple of issues in relation to well examination that we will be discussing with HSE which we hope to resolve soon.

“And I’m optimistic that we will. There are always issues that crop up and need resolving when new regulations are introduced from Europe that are the result of negotiations between many parties.

“We would have liked them to adopt the UK model, but other countries had their own ideas!”

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