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European Commission proposals risk undermining safety

02 November 2011

Responding to the publication of the European Commission’s proposals on offshore safety, Oil & Gas UK’s Chief Executive, Malcolm Webb (pictured), said: “Oil & Gas UK is opposed to blanket EU regulation of this country’s offshore oil and gas industry, which operates under a fully fit for purpose and robust regulatory regime.

Oil & Gas UK’s Chief Executive, Malcolm Webb
Oil & Gas UK’s Chief Executive, Malcolm Webb

“Relinquishing regulatory control to the EU, which has no established competence in this matter and where only three out of the 27 member states have an offshore oil and gas industry of real scale, risks undermining safety and environmental performance here in the UK.”

Indeed, almost half of the nearly 1,000 offshore oil and gas installations in operation in the EU are in the UK, according to Commission figures. There are 181 installations in the Netherlands, 123 in Italy and 61 in Denmark. There are nine other states with either a minimal offshore oil drilling presence or where licenses to do so have been awarded.

The proposed law extends liability for environmental damage to all offshore operations for which member states have responsibility. Previously, only installations in coastal waters, defined as within 12 nautical miles from shore, were considered subject to European water damage laws.

The Commission has said that the new geographical zone will instead extend 370km from shore. National licensing authorities will have to make sure that only those operators who can commit to high safety and environmental standards are allowed to explore for and produce oil and gas within the geographical zone.

Companies seeking to exploit oil and gas will have to prepare a mandatory hazard report before any exploration or production begins. This report, which must contain a risk assessment and emergency response plan, must be submitted to the national licensing authority for approval. The authority will also have to verify an installation's safety and environmental standards and any emergency provisions.

Webb added: “The EU could take other action, for example through a Directive as opposed to a Regulation, to bring member states outside the North Sea up to the high standards achieved in this area but blanket regulation of the type we understand is now being proposed will not, in our opinion, even achieve that end. Instead it will serve to confuse and complicate.

“Oil & Gas UK and its members will now take time to study and consider the full implications of the Commission’s proposals and will make representation to the appropriate parties of its position in due course.”

The new rules would only apply to oil and gas companies operating within Europe and does not cover their activities worldwide.

If approved by the European Parliament, the new law could take effect from 2012. A transitional period of a maximum of two years would apply to existing and planned installations, the Commission has said.

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