One of the results of the Deepwater Horizon incident was an unsettling introduction of more than 150 legislative proposals with at least 32 hearings in ten committees of the House of Representatives and 27 hearings in eight Senate committees.
The Joint US Coast Guard and Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE) Investigation Board and the National Oil Spill Commission convened and began the important tasks of sorting through a mountain of documents and records, listening to hours of testimony, and taking investigative steps to determine the cause of the accident.
Interim measures such as the drilling moratorium divided regulators, the industry, Gulf Coast citizens, and environmental groups. A fog of uncertainty hung over the industry while temporary actions, with the noble intention of fully assessing and managing the risks of offshore drilling, lacked specificity, leading to continuing doubts about what steps should be taken to resume safe drilling.
Elisabeth Tørstad, COO of Americas and Sub-Saharan Africa, believes DNV is forging the way to greater safety in offshore operations. “We think our position paper is a sensible and practical proposal for an effective offshore safety regulatory regime that will lead to a huge step change in improving offshore safety.”
(Images courtesy of DNV)
At the same time, industry and regulators struggled with rapidly developing offshore drilling technology, especially deepwater drilling, and began looking throughout the industry and global regulatory regimes for best practices to fully assess offshore drilling risks and safely continue offshore drilling and production for the world’s second largest energy consumer.
Unfortunately, while there was hope that a simple comparison could be identified to make sense of a complex and tightly integrated set of company procedures or regulatory regimes, it became obvious that there was a need to understand them in their entirety.
US, Norway
The Norwegian Oil Federation commissioned DNV to compare the US and Norwegian regulatory regimes to identify areas in which offshore safety could be improved in Norway. When the comparison was complete and the report was issued, it was accompanied by a clear statement on the part of DNV that the report did not – and should not be considered to – assess the effectiveness of any particular regime. The objective of the report was to demonstrate the similarities and differences between the two regulatory regimes, using the Norwegian regime as starting point. At the same time, a debate about whether the US would be better served with a prescriptive or performance-based regulatory regime was under way. This question needs to be evaluated in combination with the more fundamental question about where responsibility and accountability for offshore safety really lands.
The public expects government to ensure people and property are safe. At the same time, there is an increased expectation that all safety risks can be identified, fully assessed, and suitably managed – something the operator is absolutely best positioned to do.
Position paper
The DNV position paper on offshore safety lays the foundation for a better industry approach.
The position paper identifies the key components of an effective offshore safety regime, recognizing that prescriptive and performance-based regulatory regimes are not mutually exclusive.
Prescriptive regulations set the minimum safety requirements, but they do not fully allow for rapidly developing technology or unique or innovative operations while encouraging safe operations as both a society and business goal. There also is a place for performance-based regulations, in which safety goals, rather than minimum requirements, allow for new technology and a range of new or unexpected best practices from global operations in a dynamic industry. Performance-based regulations also squarely place the responsibility and accountability for safety on the owner. Countries can, and should, have a blend of both types of regulations.
Cooperation and communication between industry and the regulator are two of the key components for an effective offshore safety regime.
DNV supports the requirement for use of the safety case to ensure the safe design and operation of offshore facilities. Documentation in the safety case shows how all applicable laws and standards will be met and defines the major risks, most significantly in the way those risks will be identified and assessed. Safety cases require that all risks be reduced to as low as reasonably possible, including a description of what will prevent an accident or mitigate the consequences if an incident occurs. Most importantly, a proper safety case explains what procedures and actions will ensure that the risks – and the prevention and mitigation measures – are known and monitored throughout all operations.
The bowtie and barrier theories provide a system for operators as well as facility supervisors and shore-side management to clearly understand what barriers are essential to prevent an accident or mitigate one. Software displays of the barrier status can be viewed by operators, supervisors, and regulators at any time.
Peter Bjerager, director of operations, DNV North America Energy, cautions against an “overreaction” that could lead to excessive rules, noting, “Maybe that’s not the solution.”
Step change
The DNV position paper has been helpful to the industry because it distills a confusing number of facts into a framework that is constructed based on experience from global offshore operations and knowledge of different regulatory regimes.
The paper allows for full consideration of all goals and objectives, commercial and regulatory needs, and public expectations. It is a sensible and practical proposal for an effective offshore safety regulatory regime that will lead to a huge step change in offshore safety, not just an incremental bump. No single operation, company, or regulatory regime has adopted all of the recommendations, but all of the components are implemented somewhere in the world.
The question that DNV hopes to answer is how the US can adopt the best possible practices for future offshore operations.
Before a new perspective on offshore safety can be realized, however, a number of larger issues need to be debated and resolved:
• How can responsibility, accountability, and liability be balanced and squared with commercial, employment, technical, safety, political, and environmental risks? What is a reasonable liability limit under this umbrella of important considerations as the US continues to move toward energy independence and security?
• Will the US continue to participate in, and benefit from, the global energy industry, or will it attempt to build a new energy industry for all types of energy wholly within the US?
• Will the US Congress and federal agencies carefully assess the role, size, and capabilities of government agencies with the public expectations?
These are important questions that industry and government must answer together. They must be resolved before the new perspective on offshore safety can be implemented.
The DNV position paper provides a firm underpinning, but it is not an end in and of itself. It is the groundwork upon which a solution can be built to address offshore operations in the years ahead.