Oil and Gas and Sulphur Operations in the Outer Continental Shelf (OCS)-Fixed and Floating Platforms and Structures and Documents Incorporated by Reference, 41556-41583 [05-14038]

Agencies

• DEPARTMENT OF THE INTERIOR
• Minerals Management Service

[Federal Register Volume 70, Number 137 (Tuesday, July 19, 2005)]
[Rules and Regulations]
[Pages 41556-41583]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-14038]



[[Page 41555]]

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Part IV





Department of the Interior





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Minerals Management Service



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30 CFR Part 250



Oil and Gas and Sulphur Operations in the Outer Continental Shelf 
(OCS)--Fixed and Floating Platforms and Structures and Documents 
Incorporated by Reference; Final Rule

Federal Register / Vol. 70, No. 137 / Tuesday, July 19, 2005 / Rules 
and Regulations

[[Page 41556]]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Part 250

RIN 1010-AC85


Oil and Gas and Sulphur Operations in the Outer Continental Shelf 
(OCS)--Fixed and Floating Platforms and Structures and Documents 
Incorporated by Reference

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Final rule.

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SUMMARY: This rule amends our regulations concerning platforms and 
structures to include coverage of floating offshore oil and gas 
production platforms. The rule also incorporates into MMS regulations a 
body of industry standards pertaining to floating production systems 
(FPSs). Limited changes are also made to regulations concerning oil and 
gas production safety systems; and pipelines and pipeline rights-of-
way. These changes are needed because of the rapid increase in 
deepwater exploration and development, and industry's increasing 
reliance on floating facilities for those activities. Incorporating the 
industry standards into MMS regulations will save the public the costs 
of developing separate, and possibly duplicative, government standards, 
and will streamline our procedures for reviewing and approving new 
offshore floating platforms.

DATES: This rule becomes effective on August 18, 2005. The 
incorporation by reference of the publications listed in the regulation 
is approved by the Director of the Federal Register as of August 18, 
2005.

FOR FURTHER INFORMATION CONTACT: Tommy Laurendine, Chief, Office of 
Structural and Technical Support (OSTS) at (504) 736-5709 or FAX (504) 
736-1747.

SUPPLEMENTARY INFORMATION: 

Background

    In response to the rapid increase in deepwater oil and gas 
exploration and development, on December 27, 2001, MMS published a 
proposed rule (66 FR 66851-66865) to amend subpart I of 30 CFR part 
250--Platforms and Structures. The proposed rule was designed to 
streamline the permitting process for floating platforms, and to 
incorporate by reference into MMS regulations industry standards 
addressing various aspects of FPSs.
    The remarkable increase in oil and gas exploration, development, 
and production in deepwater is due to the development of new 
technologies that (1) enable drilling and production in deeper waters; 
and (2) reduce operational costs and risks. In 1993, deepwater areas of 
the OCS (water depths greater than 1,000 feet, or 305 meters) accounted 
for approximately 12 percent of the oil and 2 percent of the gas of 
total offshore production. Discovery and development of deepwater 
fields began accelerating in 1994. By the end of 2004, deepwater areas 
accounted for about 62 percent of the oil and 32 percent of the gas of 
total offshore production.
    The productivity of the new deepwater wells is enormous compared to 
past wells in more shallow waters. Historically, offshore wells 
generally have produced between 200 and 300 barrels (bbls) of oil per 
day. However, some deepwater wells have produced at rates over 30,000 
bbls per day. Success in deepwater is evident in both the high 
production rates and sustained drilling for new discoveries announced 
each year. Exploratory drilling has moved into water depths of over 
10,000 feet (3,048 meters).
    By 2003, 27 permanent development platforms had been approved for 
installation in waters over 1,000 feet deep (305 meters). Of these, 16 
structures are floating platforms and 11 are fixed. All of these 
production platforms were approved on a case-by-case basis under 
existing regulations. However, it will streamline the permitting 
process for MMS to have a designated body of standards to specifically 
deal with the whole new class of floating production platforms. The 
offshore oil and gas industry has already developed its own body of 
standards because of the recognized need to streamline the design 
process for floating platform facilities and their subsystems. In 
addition to describing the primary platform facilities, the industry 
standards also govern production and pipeline risers, station-keeping 
and mooring systems, flexible pipelines, and hazards analysis.

Use of Industry Standards

    Under existing regulations, lessees and operators must use 
standards that are acceptable to MMS or they will not receive a permit 
to proceed with their development plans. If they do not choose to use 
standards already incorporated in the regulations, they have the option 
to use equivalent standards, provided they first obtain our approval.
    The 1996 National Technology Transfer and Advancement Act (NTTAA) 
(Pub. L. 104-113) directs Federal agencies to achieve greater reliance 
on voluntary standards and standards-developing organizations by 
participating in developing voluntary standards without dominating the 
process. The NTTAA encourages ``the use by Federal agencies of private 
sector standards, emphasizing where possible the use of standards 
developed by private, consensus organizations'' to eliminate 
``unnecessary duplication and complexity'' in developing standards and 
regulations. Office of Management and Budget (OMB) Circular A-119 
specifies the requirements for Federal agencies to implement the NTTAA. 
According to Circular A-119, agencies must use domestic and 
international voluntary consensus standards in their regulatory and 
procurement activities instead of government standards, unless they 
determine that the use of consensus standards would be inconsistent 
with applicable law or otherwise impractical.

The Purpose of This Rule

    The purpose of this rule is to incorporate into MMS regulations a 
body of industry standards that will enable MMS to more efficiently 
examine plans and issue permits for floating offshore platforms. Until 
this rulemaking, MMS regulations have not specifically addressed these 
facilities separately from fixed platforms. Therefore, this rule 
includes a complete rewrite of subpart I of 30 CFR part 250 to address 
floating platforms. This rule also modifies select sections of subpart 
J concerning the incorporation of American Petroleum Institute (API) 
Spec 17J and its use when installing pipelines constructed of unbonded 
flexible pipe. Select sections of subpart H are modified to reference 
API Recommended Practice (RP) 14J as well as API Spec 17J. 
Incorporating the voluntary industry standards will save the public the 
cost of developing government-specific standards.
    This rule will enhance the efficient exploration and development of 
the most promising new sources of United States oil and gas supplies in 
the deepwater areas of the OCS in two ways. First, it will provide more 
certainty to the lessees' design engineers so that they will know in 
advance what design criteria are acceptable to MMS. Second, it will 
enhance MMS engineers' abilities to review each new project to ensure 
structural integrity, operational and human safety, and environmental 
protection. The rule will establish a single body of standards on which 
each new project can be based, and result in streamlining the 
regulatory review process.

[[Page 41557]]

    Incorporating the industry standards into MMS regulations will 
dictate that respondents comply with the requirements in the 
incorporated documents. This includes certified verification agent 
(CVA) reviews and hazards analyses. This will increase the number of 
CVA nominations and reports associated with the facilities, and require 
hazards analysis documentation for new floating platforms. (In some of 
the industry standards, the CVA is referred to as an independent 
verification agent (IVA)). Industry sources estimate that it will cost 
an average of $1.2 million to apply hazards analysis to each new 
floating production facility. Requiring the industry hazards analysis 
standard for all new deepwater floating production platforms will be 
the most costly element of this rule.
    With this final rule, MMS will incorporate seven API standards, and 
one American Welding Society (AWS) standard. MMS has actively 
participated in developing several of these standards, and believes 
that it would be difficult for the agency to write government 
regulations that would be either as technically detailed or as broad in 
scope as the standards. Incorporating these standards will help reduce 
the size and complexity of subpart I. Moreover, writing government 
regulations embodying these standards would be time-consuming and not 
economically efficient. Nor could it be done with the same level of 
expertise that was involved in the industry effort. MMS believes that 
it is entirely within the letter and spirit of the NTTAA that these 
voluntary industry standards be incorporated into our regulations. It 
is in the public interest that MMS adopt these standards.
    The eight industry standards to be incorporated are as follows:
    (1) API RP 2RD, Design of Risers for Floating Production Systems 
(FPSs) and Tension-Leg Platforms (TLPs), First Edition, June 1998, API 
Order No. G02RD1. This standard covers drilling, production, and 
pipeline risers associated with all FPSs, including spars, TLPs, column 
stabilized units (CSUs), and floating production, storage, and 
offloading units (FPSOs). Moreover, it deals with construction of 
flexible riser systems, which are not explicitly covered under current 
regulations.
    (2) API RP 2SK, Recommended Practice for Design and Analysis of 
Stationkeeping Systems for Floating Structures, Second Edition, 
December 1996, Effective Date: March 1, 1997, API Order No. G02SK2. 
This standard addresses station-keeping systems for floating platforms. 
These systems are not explicitly covered under current regulations.
    (3) API RP 2T, Recommended Practice for Planning, Designing, and 
Constructing Tension Leg Platforms, Second Edition, August 1997, API 
Order No. G02T02. Over the past 13 years, every application for a TLP 
installation in the OCS has relied on API RP 2T as the basis for its 
design. MMS has approved each of these applications on a case-by-case 
basis. There are now eight such installations in deepwater areas. For 
all practical purposes, API RP 2T is the de facto industry guideline on 
the design and construction of TLPs. In some areas, API RP 2T relies 
heavily on the analysis contained in API RP 2A, which is already 
incorporated into MMS regulations, particularly for environmental 
loading and foundation and anchoring factors. Considered by itself, API 
RP 2T imposes no new reporting requirements or third-party review 
requirements.
    (4) API RP 2FPS, Recommended Practice for Planning, Designing, and 
Constructing Floating Production Systems, First Edition, March 2001, 
API Order No. G2FPS1. API RP 2FPS serves as an ``umbrella document'' 
for all FPSs, except for TLPs (covered by API RP 2T). It incorporates 
as second-tier standards the requirements of API RP 2RD, API RP 2SK, 
API RP 14J, API Spec 17J, and those of other standards. Considered by 
itself, API RP 2FPS imposes no new reporting requirements or third-
party review requirements.
    (5) API RP 14J, Recommended Practice for Design and Hazards 
Analysis for Offshore Production Facilities, First Edition, September 
1, 1993, API Order No. 811-07200. Implementing this standard for all 
new deepwater floating production platforms will be the most costly 
element of this rule for industry. During 2000, a consensus was reached 
within the industry that the complexities and safety issues involved in 
FPSs warrant the application of this standard to all new FPSs, 
variously described as CSUs, TLPs, spars, and FPSOs, etc. Deepwater 
FPSs are the most complex systems on the OCS, and can include numerous 
production wells that flow at over 20,000 bbls per day. Therefore, MMS 
has concluded that new floating production facilities should be 
assigned the highest priority for conducting hazards analysis. This 
analysis should follow one or more of the methods described in API RP 
14J. Further, MMS believes it is most efficient to address potential 
safety and environmental hazards during the facility design phase. 
(Hazards analysis is much less useful and less cost-effective when 
applied to facilities that are already installed.) MMS will require an 
analysis of operational hazards to be included as an integral part of 
all Deepwater Operations Plans. Industry sources estimate that it will 
cost an average of $1.2 million to apply API RP 14J hazards analysis in 
the design of each new floating production facility.
    (6) API Specification (Spec) 17J, Specification for Unbonded 
Flexible Pipe, Second Edition, November 1999, Effective Date: July 1, 
2000, API Order No. G17J02. For several years MMS has been permitting 
remote subsea wells that use flexible pipe for deep sea production 
pipelines. API Spec 17J serves the interests of environmental 
protection and safety by providing guidance to both regulators and 
industry on the proper design and construction of flexible pipelines 
and flowlines. The industry projects that up to 50 percent of future 
deepwater wells will be remote subsea wells tied back to existing 
production platforms. There will also be an increasing number of 
shallow water subsea tie-backs. Therefore, this standard will be 
essential for future production operations.
    (7) American Welding Society, AWS D3.6M:1999, Specification for 
Underwater Welding (AWS D3.6M). MMS refers to this document every time 
we receive an application for an underwater welding repair. This 
document is analogous and complementary to the AWS Standard D1.1 
(Structural Welding Code-Steel), which is used for above-water welding. 
Both AWS D1.1 and AWS D1.4 (Structural Welding Code-Reinforcing Steel) 
have been incorporated into current MMS regulations for over 20 years. 
Further, MMS was a member of the subcommittee which developed AWS 
D3.6M. Underwater welding is used infrequently because of the expense 
involved in making such repairs. However, it has been used with great 
success over the years to solve several complex underwater repair 
problems, some in very deep water. MMS presently receives applications 
for underwater welding repairs on an infrequent basis, and AWS D3.6M is 
the primary document the industry follows for these purposes. This 
standard needs to be incorporated into our regulations because MMS 
anticipates a growing future need for underwater welding repairs. 
Considered by itself, AWS D3.6M imposes no new reporting requirements 
or third-party review requirements.
    (8) API RP 2SM, Recommended Practice for Design, Manufacture, 
Installation, and Maintenance of Synthetic Fiber Ropes for Offshore

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Mooring, First Edition, March 2001, API Order No. G02SM1. This is a new 
API RP that addresses an important component of offshore mooring 
systems. To date, synthetic fiber ropes have seen only limited use in 
the mooring systems of floating OCS platforms. Given the lack of long-
term experience with the use of synthetic fiber rope, API RP 2SM will 
serve as the primary reference document for use in approving 
applications which propose the use of such mooring systems. MMS was a 
member of the API subcommittee which developed API RP 2SM.

Regulatory Changes in Addition to Documents Incorporated by Reference

    This final rule totally reorganizes subpart I. Much of this 
reorganization is a result of MMS'' incorporation of the 21st edition 
of API RP 2A WSD, Recommended Practice for Planning, Designing and 
Constructing Fixed Offshore Platforms--Working Stress Design; Twenty-
First Edition, December 2000. This document was incorporated into MMS 
regulations, under separate rulemaking, on April 21, 2003. The 
incorporation allowed the elimination of much of the verbiage in the 
current subpart I regulations. Subpart I was further reorganized for 
clarity in this final rule.
    In addition to incorporating new industry documents, the revised 
subpart I adds language specific to FPSs. This language complements the 
December 16, 1998, Memorandum of Understanding (MOU) between MMS and 
the U.S. Coast Guard (USCG) that was published in the Federal Register 
on January 15, 1999 (64 FR 2660). The MOU describes our respective and 
overlapping responsibilities for regulating oil and gas activities on 
the OCS.

Discussion and Analysis of Comments

    Since the MMS first proposed this rule in December 2001, the 
location and numbering of many of the proposed regulatory sections has 
changed. In some cases, the changes were made to provide a more logical 
progression of the approval process. In other instances, proposed 
regulatory sections were moved and renumbered in this final rule to 
accommodate industry commentors' suggestions and additions to the 
proposed rules. The following table shows the final rule section 
numbers and the original proposed sections:

------------------------------------------------------------------------
        Final section of 30 CFR             Proposed section of 30 CFR
------------------------------------------------------------------------
Sec.   250.105.........................  Sec.   250.105
Sec.   250.198.........................  Sec.   250.198
Sec.   250.199.........................  New content not in proposed
                                          rule.
Proposed wording deleted from final      Sec.   250.204
 rule..
Sec.   250.800.........................  Sec.   250.800
Sec.   250.803.........................  Sec.   250.803
Sec.   250.900.........................  Sec.   250.900
Sec.   250.901.........................  Sec.   250.901
Sec.   250.902.........................  Sec.   250.917
Sec.   250.903.........................  Sec.   250.914
Sec.   250.904.........................  New content not in proposed
                                          rule.
Sec.   250.905.........................  Sec.   250.902
Sec.   250.906.........................  These requirements are not in
                                          the proposed rule.
                                          Requirements are from
                                          superseded regulations at Sec.
                                            250.909.
Sec.   250.907.........................  Sec.   250.915
Sec.   250.908.........................  Sec.   250.913
Sec.   250.909.........................  New content not in proposed
                                          rule.
Sec.   250.910.........................  Sec.   250.903
Sec.   250.911.........................  Sec.   250.904
Sec.   250.912.........................  Sec.   250.905 and Sec.
                                          250.907
Sec.   250.913.........................  Sec.   250.906
Sec.   250.914.........................  Sec.   250.908
Sec.   250.915.........................  Sec.   250.909
Sec.   250.916.........................  Sec.   250.910
Sec.   250.917.........................  Sec.   250.911
Sec.   250.918.........................  Sec.   250.912
Sec.   250.919.........................  Sec.   250.916
Sec.   250.920.........................  New content not in proposed
                                          rule.
Sec.   250.921.........................  Sec.   250.913; new content not
                                          in proposed rule.
Sec.   250.1002........................  Sec.   250.1002
Sec.   250.1007........................  Sec.   250.1007
------------------------------------------------------------------------

    Eight organizations submitted nine comments on the proposed 
rulemaking. Respondents included the American Bureau of Shipping (ABS); 
the Offshore Operator's Committee (OOC); Shell Exploration & Production 
Company (Shell), which commented twice; the Independent Petroleum 
Association of America (IPAA); the National Ocean Industries 
Association (NOIA); ChevronTexaco; Newfield Exploration Company 
(Newfield); and ATP Oil & Gas Corporation (ATP). These respondents 
raised a number of complex issues that are discussed immediately below.

Issue No. 1: Subpart I Should Be Broken Down To Separately Address 
Fixed and Floating Platforms

    ChevronTexaco commented as follows:

    There are significant differences between the two field 
development concepts covered by the proposed rewrite of Subpart I: 
The fixed production platform and the floating production platform. 
These differences include such things as number of deployments of 
each concept (a handful of floating production platforms versus 
thousands of shallow and deepwater fixed platforms); design, 
fabrication, and installation complexity; availability of design 
firms and CVA firms; and cost. ChevronTexaco suggests that forcing 
one Subpart to cover both concepts is extremely confusing, lacks 
focus on the unique characteristics of the individual concepts, and 
creates a document that is difficult to read. ChevronTexaco 
recommends two distinctly separate sections of CFR 250, either 
within Subpart I, or preferably in a new Subpart covering floating 
production platforms. Ultimately, ChevronTexaco feels

[[Page 41559]]

this will provide for a clearer document by removing the ambiguities 
created by attempting to use wording originally written for fixed 
platform in rules for floating platforms.

    More specifically, OOC commented concerning proposed Sec.  250.902 
(Sec.  250.905 in the final rule):

    * * * The proposed regulations seems [sic] to assume that the 
design stages of a floating platform matches that for a fixed 
platform. For a fixed platform, in many cases the platform is fully 
designed and is then fabricated. For a floating platform, the design 
may be done in stages with fabrication commencing on various systems 
prior to the final design of other systems. This rule making does 
not seem to take this into account. We suggest that MMS investigate 
project sequencing and take that into account in the rulemaking.

    NOIA, Shell, and Newfield all provided similar comments on this 
question.
    The Platform Verification Program (PVP) described in this final 
rule at Sec. Sec.  250.909--250.918 (Sec. Sec.  250.903--250.912 in the 
proposed rule) covers all new floating production platforms and fixed 
platforms meeting one or more of five very specific criteria: (1) 
Platforms installed in water depths exceeding 400 feet (122 meters); 
(2) platforms having natural periods in excess of 3 seconds; (3) 
platforms installed in areas of unstable bottom conditions; (4) 
platforms having configurations and designs which have not previously 
been used or proven for use in the area; or (5) platforms installed in 
seismically active areas. The final rule language was changed to 
highlight the differences between the requirements for fixed and 
floating structures, but MMS concluded that separate subparts were not 
necessary.
    MMS agrees that the third-party justification procedures for fixed 
versus floating platforms can differ significantly based on 
certification procedures (e.g., use of a CVA versus a classification 
society) and the regulatory agencies involved (e.g., primarily MMS for 
a fixed platform, versus both MMS and USCG for a floating platform). 
The regulatory language for certification under the PVP is written 
broadly so that it can cover both fixed and floating platforms.
    The specific path to obtain approval for a particular platform will 
be based on the structural components and environmental conditions 
peculiar to that platform. It is quite conceivable that a floating 
platform will undergo more complicated design, CVA, and approval 
processes than a fixed platform. After evaluating the comments, MMS 
concluded that it is better to allow engineering staffs to use their 
judgment in obtaining the various approvals than to try to write a 
``cookbook'' regulation on the step-by-step certification or 
classification process for the design, fabrication, and installation of 
a hypothetical platform.
    New innovations in offshore platforms are constantly emerging, and 
it would be impractical, if not impossible, to cover all the 
permutations in design or construction that could eventually evolve. 
The fact that most of the deepwater facilities MMS has permitted are 
floating facilities provides convincing evidence in favor of staying 
flexible in adapting our regulations to various types of facilities.
    Some commentors believe it would be more confusing to separate 
subpart I into ``fixed'' and ``floating'' components, because of the 
many systems and technical problems which both types of platforms have 
in common. MMS agreed, and concluded that it was less satisfactory to 
have two subsections, because the greater specificity concerning either 
type of system could encourage more micro-managing in the final 
regulations. This could lead to less flexibility for innovative 
designs.
    OOC commented concerning proposed Sec.  250.901(a):

    * * * In lieu of listing the standards for fixed and floating 
platforms together, it would be clearer if three lists were given: 
1. Fixed only, 2. floating only and 3. fixed and floating. This 
would eliminate confusion on the applicability of standards such as 
14J which only new floating platforms have to meet.

    Shell and Newfield provided similar comments.
    MMS agreed, and has added a chart to the final regulation to reduce 
confusion about the applicability of referenced industry standards.

Issue No. 2: The Subpart I Revisions Do Not Follow the MOU Between MMS 
and USCG

    OOC, in commenting on proposed Sec.  250.904(e), now final Sec.  
250.911(g), asserted that ``The MOU gives the USCG sole jurisdiction 
over the structural design of ship-shaped hulls and superstructures.''
    MMS disagrees, and believes that this assertion oversimplifies the 
MOU provisions assigning MMS's and USCG's respective and joint 
responsibilities for offshore floating platforms. The specific items 
listed in proposed Sec.  250.903(b), and now in Sec.  250.910(b) of 
this final rule, include the following structures normally associated 
with floating platforms: (1) Drilling and production risers, and riser 
tensioning systems; (2) turrets and turret-and-hull interfaces; (3) 
foundations and anchoring systems; and (4) mooring or tethering 
systems. The following paragraphs address these items in their 
respective order with regard to the MOU between MMS and USCG.
    Section III of the MOU contains a table listing the agencies' 
respective and joint responsibilities associated with mobile offshore 
drilling units (MODUs) and fixed and floating OCS facilities. The table 
indicates in Item 2.c that, for all floating facilities, MMS is the 
lead agency for ``risers (drilling, production, and pipeline)'' and 
further notes that ``Some pipeline risers may be subject to the 
Research and Special Programs Administration's (RSPA) jurisdiction'' 
(64 FR 2662).
    Concerning ``turrets and turret-and-hull interfaces,'' Item 2.a of 
the MOU Section III table states as follows (64 FR 2661):

    USCG responsibilities for fabrication, installation, and 
inspection of floating units are found in 33 CFR Subchapter N. MMS 
responsibilities are found in 30 CFR Subpart I. USCG and MMS will 
each review the design of the turret and turret/hull interface 
structure for ship-shaped floating facilities. All other aspects of 
the design and fabrication of all ship-shape floating facilities 
will receive only USCG review. All design, fabrication, and 
installation activities of all non-ship-shape floating facilities 
will be reviewed by both agencies.

    Thus the MOU clearly shows that MMS and USCG both have 
responsibility for reviews of the turret and turret/hull interface 
structure of ship-shaped floating facilities.
    Concerning ``foundations and anchoring systems,'' Item 4.a of the 
MOU Section III table indicates that MMS is the lead agency for 
foundations for both fixed and floating facilities (64 FR 2662). The 
MOU was written this way because MMS is the Federal agency with the 
geotechnical expertise essential for reviewing and evaluating 
foundation integrity for fixed and floating production platforms.
    Closely related to ``foundations and anchoring systems'' are 
``mooring or tethering systems.'' Item 4.b of the MOU Section III table 
indicates that ``mooring and tethering systems'' for floating 
production facilities are under the joint responsibility of both MMS 
and USCG. USCG is unquestionably the agency with the expertise and 
responsibility for determining the safety and integrity of the hull of 
a ship-shaped FPS. However, the anchoring and mooring system for a 
ship-shaped FPS is inherently different from the anchoring and mooring 
system for a ship. The FPS must remain moored on location for many 
months, if not

[[Page 41560]]

years, and in such a way that oil and gas production systems will not 
be adversely affected by excessive movement. For Item 4.b, the MOU 
states that ``USCG is not responsible for site specific mooring 
analysis.'' The question of an effective and safe mooring system cannot 
be considered apart from the question of the sea bottom into which the 
mooring system is anchored. Again, MMS is the agency with the 
geotechnical expertise to determine whether the mooring system for a 
FPS is being anchored into stable sediments.
    OOC, commenting on proposed Sec.  250.901(a) stated:

    * * * In the current MOU between MMS and USCG, the agencies have 
joint jurisdiction over the structural design on non-ship shaped 
hulls. USCG treats floating production platforms as MODUs. In 46 CFR 
108.113, USCG requires each unit to meet the structural standards of 
the American Bureau of Shipping ``Rules for Building and Classing 
Offshore Mobile Drilling Units''. There is concern that there could 
be conflicts between the recommended practices and standards 
proposed for adoption in this rulemaking and the USCG structural 
requirements. Industry has not undertaken an exhaustive study to 
determine if conflicts exist. Further, it is confusing to industry 
to have joint jurisdiction over the same system, especially when the 
criteria is [sic] different. It is suggested that MMS and USCG work 
together and either adopt the same criteria for systems in which 
they have joint jurisdiction or that one agency clearly be given the 
lead jurisdiction for each system and move away from the joint 
jurisdiction where both agencies have to approve a system.

    Shell, NOIA, and Newfield expressed similar concerns.
    MMS believes that the respondents' concerns about coordination 
between MMS and USCG are overstated. MMS further believes that the 
procedures outlined in the new subpart I and the provisions of the MOU 
between MMS and USCG are sufficient to mitigate industry's concerns of 
duplicative and conflicting requirements between MMS and USCG. That 
said, conflicts cannot be entirely avoided. In the responsibilities 
section of the current MOU, three general classifications of facilities 
are identified (i.e., MODU, fixed facility, and floating facility). The 
lead agency for each system and sub-system is also identified.
    Since USCG reviews the general marine requirements for floating 
facilities from a ship perspective, and MMS reviews oil and gas 
operations on this facility from a platform perspective, it is not 
always possible to adopt the same criteria. However, the MOU requires 
the identified lead agency to coordinate with the other agency, as 
appropriate, and also requires that both agencies work together to 
develop necessary standards and to minimize duplicative and conflicting 
requirements whenever there are overlapping responsibilities. MMS does 
not believe that anything in this final rulemaking will prevent this 
coordination from continuing.

Issue No. 3: There Could Be Conflicts Between the MMS Platform 
Verification Program and the USCG Subchapter N Requirements for 
Floating Facilities

    OOC commented as follows in its cover letter:

    * * * In the current Memorandum of Understanding (MOU) between 
MMS and USCG, both agencies have joint jurisdiction and 
responsibility to review and approve the structural design of non 
ship shaped floating platforms. Prior to this rulemaking, MMS did 
not have regulations expressly covering floating platforms; 
therefore, floating platforms have been designed in accordance with 
USCG regulations which rely heavily on American Bureau of Shipping 
Rules for Building and Classing Mobile Offshore Drilling Units (ABS 
MODU rules). USCG has approved the use of other rules and guides as 
well as industry standards as appropriate to supplement the ABS MODU 
rules. Due to the high level of activity in deepwater and the 
limited staff available within companies, we have not undertaken an 
exhaustive comparative review of the proposed documents to be 
incorporated by reference with the ABS MODU rules. However, there is 
a high probability that conflicts may occur. In the event that 
conflicts do occur, how will the conflict be resolved between MMS 
and USCG regulations on the same system?
    The joint jurisdiction of MMS and USCG over the same systems is 
confusing to industry, especially when conflicts occur. There are 
several approaches that we believe MMS and USCG could consider to 
eliminate the concern over joint jurisdiction. One would be to adopt 
identical regulations for systems subjected to joint jurisdiction. 
Or, MMS and USCG could work together to clearly identify lead 
agencies with the authority to approve each system in lieu of both 
agencies approving each system. Or, since the concept of 
verification agents is acceptable to both MMS and USCG, a 
verification agent that is acceptable to both agencies could review 
the project utilizing the best regulations and standards for the 
specific project or system, regardless if the regulations were 
identical between the two agencies.

    Continuing coordination between MMS and USCG is required during the 
review and approval of OCS floating platforms. For the reasons stated 
under the preceding Issue No. 2, it is unrealistic to expect MMS and 
USCG to adopt identical standards because of the different natures of 
the types of facilities they regulate, and the separate 
responsibilities assigned to each agency by Congress. Both agencies 
have worked diligently through various MOUs over the years to adapt 
their regulatory requirements to changing technology, circumstances, 
and statutory responsibilities.
    USCG is currently revising the regulations at 33 CFR subchapter N. 
Since these are draft regulations, MMS believes it would be 
counterproductive at this time to do a complete and detailed comparison 
between our final subpart I regulations and the USCG proposed version 
of 33 CFR subchapter N. Prior to finalizing subchapter N, USCG and MMS 
have agreed to do a detailed comparison of the floating platform 
requirements of both agencies to identify and eliminate potential 
conflicts to the maximum extent practicable.
    Concerning the matter of CVAs that are acceptable to both MMS and 
USCG, neither MMS nor USCG believes it should be in the business of 
certifying or recommending CVAs. Nevertheless, MMS would encourage 
lessees to submit qualification statements for CVAs that would be 
acceptable to both MMS and USCG.

Issue No. 4: It Is Unclear What Submissions MMS Expects To Receive

    OOC commented concerning proposed Sec.  250.903(b), Sec.  
250.910(b) in this final rule:

    * * * Since the structures listed as (1)(2)(3) and (4) are not 
mentioned in (proposed) Sec.  250.902, it is not clear what 
information MMS expects to be provided in the application process or 
in the CVA process. Please clarify.

    For clarity in this final rule, language was added to the table in 
Sec.  250.905(d), (f), and (h) concerning the items listed in proposed 
Sec.  250.903(b). Briefly summarized, MMS expects to see all structures 
under our jurisdiction submitted through the normal platform approval 
process. The PVP is required for all platforms that do not meet 
standard design criteria for shallow waters. This will always be the 
case for a floating platform.

Issue No. 5: It Is Unclear What Is Expected of the CVA Process for 
Floating Platforms

    Concerning proposed Sec.  250.905(a), OOC commented:

    * * * The design verification plan requirements are confusing. 
The proposed regulation appears to be based on CVA processes for 
fixed platforms. These are not applicable for floating platforms. 
MMS should write separate requirements for CVA processes for fixed 
and floating systems. For floating systems, the operator submits the 
design documentation specified in (1), (2) and (3) directly to the 
CVA, not to MMS to

[[Page 41561]]

give to the CVA. Is this a change in the program? Also, in most 
cases for a floating system, all the required information will not 
be given to the CVA at one time, but rather will be given to the CVA 
in a sequential manner as it is generated. It is recommended that 
MMS investigate the process used for the floating systems to date 
and modify the proposed rule accordingly.

    OOC provided nearly identical comments on proposed Sec.  
250.905(b). Shell provided similar comments. Those proposed subsections 
were renumbered as Sec. Sec.  250.912(a) and (b) in this final rule.
    As explained above in Issue No. 1, concerning whether subpart I 
should be broken down to separately address fixed and floating 
platforms, MMS agrees that a floating platform probably will undergo 
more complicated design, CVA, and approval processes than a fixed 
platform. MMS concluded that it is better to allow the companies' 
engineering staffs to use their judgment in obtaining the various 
approvals rather than for MMS to impose a rigid step-by-step 
certification or classification process for the design, fabrication, 
and installation of each style and permutation of a platform.
    MMS has not changed the program with respect to how PVP materials 
are submitted to the CVA. MMS has always required this information to 
be directly provided by the operator to both MMS and the CVA. The CVA's 
responsibilities during the design, fabrication, and installation 
phases are described in final Sec. Sec.  250.916, 250.917, and 250.918, 
respectively. The CVA for each phase will not be able to perform these 
responsibilities in a proper manner without access to all the 
documentation submitted to MMS.
    MMS agrees with OOC that in most cases, and for floating platforms 
in particular, required information will not be given to either the CVA 
or MMS at one time, but rather will be provided in a sequential manner 
as it is generated. This is to be expected, and is acceptable from our 
viewpoint. MMS is willing to review Platform Verification and CVA 
documentation as it becomes available, and there is no requirement in 
our regulations to submit it at one time. The only MMS requirements 
with respect to timing are the requirement in new Sec.  250.912(a) that 
the lessee may not submit its design verification plan before 
submitting a Development and Production Plan (DPP) or a Development 
Operations Coordination Document (DOCD), and the requirement in new 
Sec.  250.912(d) that operators combine fabrication verification plans 
and installation verification plans for man-made islands.
    This final rule should make it easier to obtain approvals for 
floating offshore platforms. MMS has concluded that it is best to issue 
this final rule, rather than re-propose it with two separate CVA 
processes for fixed and floating platforms, as OOC suggests.
    Concerning proposed Sec.  250.910(d), located at Sec.  250.916(c) 
in this final rule, OOC continued:

    * * * It should also be recognized that for floating systems, 
the CVA has been verifying the design to the USCG requirements since 
MMS had not established design requirements. It will take the CVA 
longer to verify the design to the new requirements. In the cases 
where the CVA is also approving the design for Class and/or USCG, 
they will also have to verify the design to those requirements.

    MMS agrees that it may take the CVA longer to verify the design to 
the new regulatory requirements. For those cases where the CVA is also 
approving the design for Class and USCG requirements, USCG will also 
have to verify the design requirements. This process is addressed in 
the current MOU between MMS and USCG.
    OOC and Shell requested that naval architects be included in the 
list of personnel conducting the design verification described in 
proposed Sec.  250.905(a). MMS agrees, and Sec.  250.912(a) of our 
final rule has been amended accordingly.
    Concerning proposed Sec.  250.911(f), OOC and Shell requested, 
``Please clarify if the fabrication CVA is expected to verify the 
center of gravity, etc. that is normally considered to be part of the 
USCG review and approval.''
    MMS understands industry's concerns about coordination between MMS 
and USCG, particularly regarding floating platforms, and added language 
to final Sec. Sec.  250.916(b) and 250.917(b) stating, ``For floating 
platforms, the CVA must ensure that the requirements of the USCG for 
structural integrity and stability, e.g., verification of center of 
gravity, etc., have been met.''
    Concerning proposed Sec.  250.905(c), (Sec.  250.912(c) in this 
final rule), OOC commented, ``We assume that the inspections discussed 
in (4) are the inspections performed immediately after installation to 
ensure that no damage was done during the installation activities.''
    OOC is correct. The final rule includes revised language in Sec.  
250.912(c)(4) to clarify this point. In some cases it may be desirable 
to conduct intermediate inspections during installation to ensure that 
the installation is continuing according to plan.

Issue No. 6: The Submission and Review Timeframes for Various Documents 
Are Unclear

    OOC and Shell commented concerning the proposed Sec.  250.904(b) 
requirement for three copies each of the design verification, 
fabrication verification, and installation verification plans, now 
contained in Sec.  250.911(c) of this final rule, that the ``MMS should 
establish a time frame for approval following the submittal of the 
required plans.''
    MMS does not agree. The industry respondents themselves have all 
expressed concerns about the complexity of the new subpart I approval 
processes, and uncertainty about their own ability to provide adequate 
documentation to obtain the necessary approvals from both MMS and USCG. 
The submission, review, and approval processes are all very complex. 
Therefore, MMS concluded that it would be unwise to try to put a 
scheduled approval process in place for any segment of the PVP. As 
discussed above under Issue No. 5, MMS agrees with OOC that in most 
cases, and for floating platforms in particular, required information 
will not be given to either the CVA or MMS at one time, but rather will 
be provided in a sequential manner as it is generated. The regulations 
do not require that all information under the PVP be submitted at one 
time.
    As mentioned earlier in our discussion of Issue No. 2, some 
conflicts between MMS and USCG cannot be avoided, and this means that 
there can be no certain schedule for review and approval. In the 
responsibilities section of the MOU between MMS and USCG, a lead agency 
is identified not only for each system, but also for each sub-system. 
For example, each agency is identified as the lead agency for some 
aspect of the station keeping system (including foundations, moorings, 
and tethering systems; or dynamic positioning). Each agency must review 
the design of the station keeping system with respect to foundations, 
moorings, and tethering systems, since it affects the floating 
stability of the facility and the drilling and production operations on 
the facility. Any disagreements will need to be discussed and resolved, 
and MMS cannot guarantee a certain review and approval schedule in such 
situations.
    Concerning proposed Sec.  250.910(d), now Sec.  250.916(c) in this 
final rule, OOC commented:

    * * * These requirements appear to be based on fixed platforms 
and are not applicable to floating platforms. The requirement to 
submit the design CVA

[[Page 41562]]

reports within 6 weeks of receipt of the design data for a fixed 
platform is too short a period. Recommend that the requirement be 
revised to within 90 days of the receipt of the design data, but at 
least prior to facility installation. For floating platforms, the 
complete design data is not provided to the CVA in one package; 
therefore, there should be some recognition of a phased approach. In 
all cases, the final report should be issued to MMS prior to 
installation.

    Shell provided similar comments.
    MMS agrees with OOC and Shell, and amended final Sec.  250.916(c) 
to specify that the CVA must submit the design verification report 
within 90 days of the receipt of the design data. However, MMS has also 
specified that the design verification report must be submitted before 
fabrication begins, rather than before installation begins.
    Also, OOC and Shell commented concerning proposed Sec.  250.911(f) 
that the requirement to submit the fabrication CVA reports immediately 
after completion of the fabrication is not really defined. They 
recommend that the requirement be revised to within 90 days of the 
completion of fabrication, but at least prior to facility installation.
    MMS agrees with OOC and Shell, and amended final Sec.  250.917(c) 
to specify that the CVA must submit the fabrication report within 90 
days of the completion of fabrication, but before installation begins.
    OOC and Shell also commented concerning proposed Sec.  250.912(e) 
that the requirement to submit the installation CVA reports within 2 
weeks of completion of the installation is too short a period. They 
recommended that the requirement be revised to within 30 days of the 
completion of the facility installation.
    MMS agrees, and amended final Sec.  250.918(c) accordingly.

Issue No. 7: MMS Should Write Clear and Comprehensive Regulations That 
Do Not Require Later Notices to Lessees and Operators (NTLs) To Explain 
or Interpret Regulations to Industry

    In its cover letter to MMS concerning the proposed rule, OOC 
commented:

    Further, we have heard comment by MMS that either in conjunction 
or following this rulemaking effort, MMS is considering issuing a 
Notice to Lessees (NTL) explaining the interpretation of the 
regulation. We believe that the regulation should be written in a 
clear, comprehensive fashion such that a NTL, if needed at all, 
would only cover limited areas. Appropriate areas to be included in 
a NTL would be such specifics as a time frame for conducting 
inspection under API RP 2A for existing platforms and a list of 
acceptable CVAs.

    MMS agrees. The agency has written this rule to be as comprehensive 
and clear as possible to minimize the chances that an NTL will be 
required. If it is found that an NTL is needed, MMS agrees it should 
only address limited, site-specific areas, and provide guidance on how 
to implement the existing regulation.

Issue No. 8: Floating Platforms Designed According to ``Class'' Should 
Not Need Specific Approval of the MMS Regional Supervisor

    Concerning proposed Sec.  250.901(b), both OOC and Shell stated:

    If an operator chooses to Class his floating platform, the 
systems covered by Class should be allowed to be designed to Class 
rules without seeking specific approval from the Regional 
Supervisor.

    MMS recognizes that the decision to design a platform according to 
``Class'' requirements provides a level of safety in verifying the 
structural stability of the platform. However, since this decision is 
optional and there is no requirement to maintain the Class of a 
platform, MMS must ensure that all OCS platforms meet MMS regulations. 
Therefore, all OCS platforms, including those that the lessee or 
operator chooses to design according to Class requirements, will 
continue to be specifically approved by the MMS Regional Supervisor 
under current regulations.
    Concerning proposed Sec.  250.902(j), now Sec.  250.905(j) in this 
final rule, Shell commented:

    The Certification required in (j) `The design of this structure 
has been certified by a recognized classification society * * *.' is 
stated as if the design at the time the application has been made 
has already been reviewed and approved. At the time the application 
is made, the design of a floating structure will NOT have been 
certified by a recognized classification society. We recommend that 
you restate the Certification to `The design of this structure will 
be certified * * *'.

    MMS cannot agree with the requested word change. Because of the 
schedule on some projects, MMS receives applications for platforms 
prior to the design being completed. However, these applications must 
include evidence that the design is in the process of being certified. 
Prior to installation, a final certified design must be submitted for 
approval by the MMS Regional Supervisor.
    Concerning proposed Sec.  250.903(a), Sec.  250.910(a) in the final 
rule, OOC and Shell commented:

    If an operator chooses to Class the structure, the systems 
covered by Class should not be subject to the Verification program, 
rather the operator should be required to submit a Class certificate 
once it is issued following the installation of the structure.

    In order for MMS to agree with the OOC and Shell proposal, MMS 
would have to agree to defer to the procedures used to Class each 
floating platform, and MMS would also have to require that the Class 
for each floating platform be maintained and renewed for the life of 
the platform. As explained in its response to the first comment on this 
issue, MMS will not do that. The PVP is not an optional program in lieu 
of designing a platform according to Class requirements. This program 
has served MMS and industry well, and MMS intends to continue to 
maintain the program of third party verification for platform design, 
fabrication, and installation. Under the OCS Lands Act, MMS is 
obligated to oversee oil and gas exploration, development, and 
production operations on the OCS to ensure that they are conducted in a 
safe manner. The verification of production platforms is a part of that 
responsibility.

Issue No. 9: MMS Should Better Define What Is Meant by ``New'' Floating 
Platforms and ``Major Modifications''

    Newfield commented, ``Definitions of `new' and `major modification' 
are vague and require more precise definitions to prevent confusion and 
interpretation problems.''
    Also with respect to new facilities, OOC and Shell commented 
regarding Sec.  250.800(b) and Subpart I:

    1. How is `new' defined? It should be realized that in many 
cases there is a long lead time between the initial design of the 
platform, the facilities, mooring and risers and fabrication and 
installation. All floating platforms currently in either the late 
stages of design or being fabricated may not fully comply with all 
of the proposed regulations. This comment is applicable to other 
parts of the proposed regulation where `new' is utilized.
    2. How are fixed and floating platforms handled that are reused 
or relocated to a different block than where they were originally 
sited? Is the design grandfathered to the rules in place at the time 
the unit was designed, fabricated and originally installed or will 
it have to meet any new requirements that have been adopted since 
the initial installation? Is there a difference in the way fixed 
platforms are handled from floating platforms?

    From MMS's perspective, a ``new platform'' means a newly-
constructed platform at a certain location, or a used platform that is 
either moved to a new site or used for a new purpose. In the first 
situation, the platform is considered a ``newbuild.'' In the latter 
situation, it would be a used platform converted for a new use or at a 
new site. There is no ``grandfathering'' of prior

[[Page 41563]]

standards for relocated platforms. For either a newbuild or a 
relocated/new-use platform, the platform would have to meet MMS 
regulations as they exist at the time the platform design is reviewed 
(or re-reviewed) by MMS. For fixed platforms, all design, fabrication, 
and installation requirements would be governed by MMS regulations. 
Floating platforms would be governed by both MMS and USCG regulations, 
as described above in the Issue No. 2 discussion concerning the MOU 
between MMS and USCG.
    In the case of a used platform, the design is approved for the new 
use or site, and the used platform would have to meet the requirements 
of Section 15 of API RP 2A, which addresses the key aspects of reused 
platforms. Relocated facilities would have to meet all new 
requirements, and pass the inspection requirements listed in Section 15 
of API RP 2A. The Twenty-first Edition of API RP 2A was incorporated 
into MMS regulations under a separate rulemaking on April 21, 2003.
    Although API RP 2A addresses fixed structures, MMS would apply some 
of the principles and methodologies outlined in API RP 2A for reused 
facilities to floating platforms also. In addition, there are certain 
structural fatigue considerations related to floating platforms that 
are partly covered in other API standards, such as API RP 2FPS and API 
RP 2SK, and which would be applicable to reused floating facilities. 
Finally, a reused floating facility relocated to a new site would be 
treated as a new facility requiring an API RP 14J hazards analysis.
    Once the design for any fixed or floating platform is approved, MMS 
regulations at the time of the design approval will govern the 
fabrication and installation phases as well. In that sense, the subpart 
I regulations are grandfathered when the platform design is approved 
for a specific platform, use, and location. MMS has always followed 
this principle under subpart I.
    Concerning proposed Sec.  250.900(a), (Sec.  250.900(a) and (b) in 
this final rule), OOC commented:

    Although major modification is vaguely defined in 250.900(a)(2), 
industry is confused by the definition and it is not clear what MMS 
means by the definition. Either more precise definition is needed or 
examples need to be given. Is there a difference in major 
modification to a fixed platform versus a floating platform?

    OOC and Shell further commented concerning proposed Sec.  
250.903(c), (Sec.  250.909 in this final rule):

    What constitutes a major modification to a fixed or floating 
platform? Does it include such things as increased loading due to 
additional topsides equipment or loading from additional wells or 
risers?

    From MMS's perspective, a major modification would be any 
modification to a structure that affects loading by more than 10 
percent. This definition follows the principle that MMS has used over 
the years, as well as the guidance in API RP 2A, Section 17, 
``Assessment of Existing Platforms,'' Subsection 17.2.6, ``Definition 
of Significant.'' This definition states: ``Cumulative damage or 
cumulative changes from the design premise are considered to be 
significant if the total of the resulting decrease in capacity due to 
cumulative damage and the increase in loading to cumulative changes is 
greater than 10 percent.'' Although, the subsection is written to apply 
to either damage or structural changes, MMS believes this is a good 
principle to follow for all platforms. This is especially important for 
floating platforms, because of the stability issues that arise when 
additional loads are added to floating structures. Thus, when OOC and 
Shell ask whether a ``major modification'' could include ``increased 
loading due to additional topsides equipment or loading from additional 
wells or risers,'' the answer is ``yes.'' Also, repairs to a structure 
to correct damage could be seen as a major modification if they 
increase loading on the platform by 10 percent or more.
    MMS will evaluate proposed modifications on a case-by-case basis. 
Language has been added to both Sec.  250.900(b) and Sec.  250.910(c) 
in this final rule to clarify that a major modification includes any 
modification that increases loading on a platform by 10 percent or 
more, and requiring that lessees and operators consult with both MMS 
and USCG in seeking approval for a major modification to a floating 
platform.

Issue 10: The Application of American Petroleum Institute (API) 
Recommended Practice (RP) 14J, and API RP 2FPS to ``New'' Floating 
Production Platforms Needs Clarification

    Concerning proposed Sec.  250.803, ABS commented:

    We note the proposed incorporation of API RP 14J into the 
revised rules. In this regard, we note that much of 14J was written 
from the standpoint of use with fixed platforms. With respect to 
floating structures (such as spars and FPSO's) it is unclear whether 
the risk assessment methodologies and checklists accompanying the 
14J document will adequately cover the integration of vital process 
and marine systems (such as ballast control, stability, marine 
system integration, cargo transfer, etc.), where simultaneous 
operations and cross-overs are prevalent. The hazards assessment 
methodology proposed by MMS should therefore consider ways to ensure 
that strict adherence to 14J in carrying out a hazards analysis on a 
floating installation will address this vital marine/process system 
relationship.

    Concerning proposed Sec.  250.901, ABS commented:

    It is noted in the proposed rulemaking commentary that API RP 
2FPS is an umbrella document imposing no new requirements directly. 
Structural and production facility requirements are specifically 
referenced throughout Sec.  250. Prior to this rulemaking MMS had no 
specific rules for marine and other non-production related systems 
for floating production units, as are found in API RP 2FPS. A 
specific statement as to MMS intentions relative to these non-
production systems would be appropriate.

    MMS agrees with ABS that API RP 14J and API RP 2FPS may not by 
themselves completely address all aspects of floating facilities to be 
regulated under subpart I. Nevertheless, these two industry references 
serve very useful purposes. API RP 2FPS provides guidance on all of the 
associated marine systems, as well as drilling and production systems, 
and how they fit together and interact with each other. MMS knows of no 
other standard that performs this function. Though API RP 14J was 
initially developed to address hazards analysis approaches for drilling 
and production systems on fixed offshore platforms, these same systems 
will be installed on floating offshore platforms. Further, the hazards 
analysis approaches presented in Section 7 of API RP 14J will prove 
important in considering simultaneous operations and cross-over that 
will occur on floating offshore platforms. That is why MMS is 
incorporating these two documents by reference into our regulations, 
and intends to employ them, as appropriate, in our review of new 
floating production facilities.

Issue No. 11: The Application of American Petroleum Institute (API) 
Recommended Practice (RP) 2A to Fixed Production Platforms Needs 
Clarification

    ABS commented concerning proposed Sec.  250.901:

    The document adopts the API-RP2A-WSD. Is the API - RP2A - LRFD 
not acceptable at this time for any application? Some of the 
requirements in API - RP2A - LRFD, such as hydrostatic collapse of 
tubular members for deepwater applications, may be more reasonable 
than those in WSD. If acceptable, guidance in the regulations should 
specify load and resistance factors.

    Since the early 1980s, MMS has followed the policy currently 
outlined in Sec.  250.141 of our operating

[[Page 41564]]

regulations, whereby MMS promotes the use of technology or innovative 
practices that are not specifically mentioned or otherwise covered 
under our regulations. For example, Sec.  250.141 tells the lessee or 
operator that ``You may use alternate procedures or equipment after 
receiving approval as described in this section.'' The approval must be 
in writing from either the MMS District or Regional Supervisor. 
Paragraph (a) of Sec.  250.141 requires that ``Any alternate procedures 
or equipment that you propose to use must provide a level of safety and 
environmental protection that equals or surpasses current MMS 
requirements.'' Paragraph (c) of Sec.  250.141 requires that the lessee 
or operator submit information or provide an oral presentation to 
describe the site-specific applications, performance characteristics, 
and safety features of the proposed alternate procedures or equipment.
    Thus, if a lessee or operator believes that the load and resistance 
factors design (LRFD) version of API RP 2A is more appropriate for its 
proposed platform than the working stress design (WSD) version, the 
lessee or operator may submit its arguments to use the former under 
Sec.  250.141 of MMS operating regulations. As stated previously in 
this discussion, MMS has already incorporated the Twenty-First Edition 
of API RP 2A into our regulations under a separate rulemaking dated 
April 21, 2003.

Issue No. 12: MMS Should Publish a List of Acceptable CVAs for Various 
Types of Structures

    In their cover letter, OOC commented:

    * * *In lieu of submitting a qualification statement and 
obtaining approval for each CVA for each project, MMS should publish 
a list of acceptable CVAs for various types structures for which a 
qualification statement is not required. For example, ABS and DNV 
for spars and TLPs. If an operator wanted to use a CVA not on the 
``approved'' list, then a qualification statement would be required 
and the CVA would have to be approved.

    MMS does not agree with this recommendation. In 1979, when the PVP 
was first instituted, MMS' predecessor agency maintained a list of 
acceptable CVAs for various types of offshore platforms and for the 
various phases of the verification process, as proposed in OOC's 
comment. However, it soon became apparent that, as a result of the 
movement of personnel between companies and continuous changes in a 
company's workload, the qualifications of the companies on this list 
changed frequently. It was not possible to ensure that a specific 
company maintained the required expertise to remain on the CVA list on 
a long-term basis. Also, some companies discovered that being on such a 
list did not ensure that they would receive any work as a CVA. 
Therefore, MMS stopped maintaining a list of acceptable CVAs and began 
to allow OCS lessees to nominate their selection of a company or a 
person to act as their CVA on a case-by-case basis for each project and 
phase of the project. This approach was already implemented in our 
regulations and is continued in the new subpart I under Sec.  250.914.

Issue No. 13: There Should be More Guidance in Proposed Sec. Sec.  
250.902 and 250.903, Now Numbered as Final Sec. Sec.  250.905 and 
250.910, Concerning CVA Responsibilities for Review of (1) Drilling and 
Production Risers, and Riser Tensioning Systems; (2) Turrets and 
Turret-and-Hull Interfaces; (3) Foundations and Anchoring Systems; and 
(4) Mooring or Tethering Systems

    Concerning proposed Sec.  250.902, OOC commented:

    * * *We also note that no information has been requested to be 
submitted in the platform application on the drilling and production 
risers and tensioning systems for floating platforms even though 
these are proposed to be covered under the CVA program. What 
information are we required to provide to either MMS or the CVA on 
these elements?

    OOC made a similar comment regarding proposed Sec.  250.903(b), as 
follows:

    1. While it may be prudent to include drilling and production 
risers and riser tensioning systems in the CVA program for design, 
it is problematic to include these into the fabrication and 
installation CVA program. The risers and tensioning systems will be 
fabricated for wells