Modernizing the U.S. Offshore Oil and Gas Inspection Program for Increased Agility and Safety Vigilance (2021) / Chapter Skim
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1 Introduction
1 Introduction
Pages 11-30
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From page 11... ...
The nature of these decisions is reflected in the diverse questions asked by BSEE in the study charge. Thus, following the background section, the specific elements of the charge are discussed and then framed according to what the committee perceives as BSEE's interest in making its inspection program not only more agile and efficient, but also better suited to the agency's mission centered on promoting safety and environmental protection.
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From page 12... ...
USDOI established BSEE in 2011 as a successor to other departmental agencies that have exercised this OCSLA regulatory authority since the 1950s. Accordingly, BSEE is responsible for issuing and implementing a long-standing body of offshore safety and environmental regulations that has grown over the years to account for nearly all safety-related aspects of offshore operations, including drilling, well completion and operation, production systems, pipelines, and platform and structure design and construction.
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From page 13... ...
under established interagency agreements.5 BSEE inspectors will also read oil and gas production meters (which is not a safety-related function) per agreement with its sister agency responsible for assessing and collecting royalties, the Office of Natural Resources Revenue.
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From page 14... ...
The Pacific and Alaska regions include approximately two dozen additional platforms that are not included in Table 1-1. TABLE 1-1 Total Number of GOM Production Platforms by Water Depth Platforms Platforms <500 Feet Water ≥500 Feet Water As of January 1 of Total Depth Depth 2010 3,557 3,484 73 2011 3,367 3,295 72 2012 3,093 3,020 73 2013 2,819 2,746 73 2014 2,613 2,539 74 2015 2,431 2,355 76 2016 2,307 2,231 76 2017 2,110 2,034 76 2018 2,004 1,929 75 2019 1,870 1,794 76 2020 1,783 1,708 75 2021 1,763 1,689 74 NOTES: The numbers include platforms that are actively producing and some that are no longer producing but not fully decommissioned.
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From page 15... ...
The safety and environmental concerns associated with offshore oil and gas production have also been changing as activity in deeper water has increased relative to shallow-water activity. Both drilling and production operations in the deeper waters of the OCS are more complex and can be more hazardous, as harsh marine and weather conditions can hinder access to and evacuation from locations that are often remote; deepwater reservoirs are more likely than shallow-water reservoirs to have higher pressures and higher temperatures to produce high well flow rates; and the larger and remote deepwater facilities must be designed to accommodate a wide range of hydrocarbon production, processing, storage, and transportation activities while also providing living quarters for dozens of workers.
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From page 16... ...
Demand for exploring and developing new wells, and thus the services of these specialized contractors, is highly sensitive to energy prices, as evident by developments during the 2020 pandemic. According to BSEE data,9 about 42 mobile drilling rigs were operating in the GOM during 2018 but the number dropped to fewer than 20 by September 2020 as the price of oil declined sharply.10 Whether the economic repercussions from the pandemic, coupled with high cost of owning and operating the increasingly sophisticated rigs needed for offshore drilling, result in further consolidation toward increasingly larger drilling contractors is an open question, but some industry reports suggest the likelihood of such a development.11 It also is an open question whether the stopping and restarting of these large, complex rigs, including the need to re-staff them and ensure that new personnel have sufficient training and that returning personnel retain competencies, will create special hazards.
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From page 17... ...
BSEE was charged with making changes to its regulatory program to address concerns that the body of offshore regulations had become too focused on controlling individual risk factors -- and that inspection approaches had followed suit -- while paying insufficient attention to controlling system-level risks that arise from interactions among technology and humans.15 As is evident from the Deepwater Horizon disaster, the complex designs and operations of deepwater facilities were creating many facility- and operations-specific risks that could not be known by the regulator, much less controlled by a collection of narrowly targeted and detailed requirements covering individual components, safety equipment, and processes. Moreover, important factors related to system risk and health, such as leadership, decision making, and managing change and human behavior, cannot be defined in and assessed in a detailed list of regulatory commands.
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From page 18... ...
Instead, the requirement for operators to develop and implement a SEMS program was adopted to supplement the regulations. Facility inspections would remain central to verifying compliance with regulations other than the SEMS rule, usually consisting of BSEE inspection personnel flying by helicopter to a platform, observing the general condition of the structure, witnessing safety device testing with the operator, and reviewing paperwork in accordance with a set of guidelines for items to inspect known as the Potential Incident of Noncompliance (PINC)
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From page 19... ...
violations detected through BSEE's traditional inspection program can provide some insight into whether an 17 Under agreement with BSEE, the American Petroleum Institute's Center for Offshore Safety is an approved accreditation body responsible for the development of good practice documents for SEMS programs and for accrediting and ensuring that third-party auditors (audit service providers) meet the program's goals and objectives.
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From page 20... ...
Indeed, as early as 1993, MMS had considered requiring all operators to establish a SEMS-like program, and as noted above, the offshore industry had established guidelines for safety management systems.18 Moreover, a heavy reliance on safety management systems is the hallmark of offshore regulatory regimes in some other parts of the world. Canada, Norway, and the United Kingdom require the operator, referred to as the "duty holder," to undertake rigorous hazard and risk analyses and management planning, and to act in accordance with the plans.
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From page 21... ...
Nearly 10 years after BSEE was created following the Deepwater Horizon disaster, many questions remain about how its inspection program should function and adapt to a continually changing offshore energy landscape. Even as it seeks to improve the effectiveness and efficiency of its inspection program, BSEE wants to make it better suited and more complementary to its efforts to both prompt and support offshore operators in developing effective safety management systems rooted in strong safety cultures.
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From page 22... ...
The study charge and its varied themes and questions are discussed next, followed by an explanation of how and why the study committee chose to frame and address them in a manner that allows for a more cohesive report aimed at providing strategic advice. STUDY CHARGE Seeking an independent review of its inspection program, BSEE asked the National Academies to convene an expert committee to consider several topics, or themes, of interest, which the agency elaborated on with the questions shown in Box 1-2.
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From page 23... ...
• Are there certain functions/equipment best suited for BSEE remote real time monitoring that will enhance safety or environmental protection? • Are there other technologies that could be used by BSEE that would enhance safety or environmental protection?
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From page 24... ...
Regulators can struggle, however, in establishing their own roles in verifying that the regulated entity is following its customized safety plans, particularly in determining if and how inspections should be used for such purposes. Acknowledging its own struggles in this regard, BSEE seeks the committee's views on the role of agency inspectors vis-à-vis third-party auditors for assessing and ensuring SEMS compliance.
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From page 25... ...
Intent on advising BSEE in a manner that informs the strategic direction of its inspection program, the study committee considered the topics of the six themes and accompanying questions in their entirety, and in a manner that better reveals the many challenges that the agency faces as it tries to align its policies, procedures, and programs to achieve its mission as the offshore oil and gas industry keeps evolving and adding new technological capabilities and as the safety and environmental risks of offshore activity receive increased public scrutiny. In considering the study charge and
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From page 26... ...
This goal is evident, for instance, in questions posed in the study charge asking how BSEE can improve its current Risk-Based Inspection program and its measurements of risk reduction and safety enhancement. • To be more data-informed by marshaling and leveraging informa tion obtained from SEMS audits, incident and near-miss reports, remote monitoring data, equipment failure reports, inspection re sults, and other data sources to guide outcome-oriented inspection policies, programs, and procedures and measure their effectiveness in reducing incidents and their severity.
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From page 27... ...
2021 explains the agency's intention to align its policies, programs, and procedures in accordance with the changes in the risk profile of the offshore industry, particularly changes arising from increasing activity in deeper water, where facilities are not only larger and more complex but produce large volumes from high-temperature and high-pressure reservoirs and have many more workers on site, all of which demand vigilance to prevent catastrophic events.25 Similar intentions have been expressed in BSEE's past budget requests, strategic plans, and annual reports, all emphasizing the agency's responsibility to not only administer and enforce safety and environmental regulations, but also to conduct assessments of new technologies and collaborate with industry in making improvements to the offshore safety culture (BSEE 2020) .26 The committee chose to frame the study charge in terms of these five aspirational goals as a means of providing BSEE's leadership with more cogent and strategic advice.
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From page 28... ...
Consideration is given in this chapter to relevant regulatory and inspection approaches employed by regulators of the offshore industry in other countries and of other high-hazard industries in the United States. Chapter 4 considers the goals of a safety and environmental regulatory agency at the most fundamental level, and to the kinds of challenges that the agency can face in pursuing them through the use of inspections and other means.
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From page 29... ...
2016. Special Report 321: Strengthening the Safety Culture of the Offshore Oil and Gas Industry.
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