Oil and Gas and Sulphur in the Outer Continental Shelf (OCS)-Safety and Environmental Management Systems, 29277-29280 [E6-7790]
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Federal Register / Vol. 71, No. 98 / Monday, May 22, 2006 / Proposed Rules
FOR FURTHER INFORMATION CONTACT:
DEPARTMENT OF THE INTERIOR
Minerals Management Service
30 CFR Part 250
RIN 1010–AD15
Oil and Gas and Sulphur in the Outer
Continental Shelf (OCS)—Safety and
Environmental Management Systems
Minerals Management Service
(MMS), Interior.
ACTION: Advance Notice of Proposed
Rulemaking (ANPR).
rmajette on PROD1PC67 with PROPOSALS
AGENCY:
SUMMARY: MMS is seeking comments on
how to improve our regulatory approach
to safety and environmental
management systems (SEMS) for
operations conducted in the OCS. The
various approaches for SEMS include
voluntary and mandatory
implementation of partial and full
SEMS. In addition, the MMS is seeking
comments on a regulatory scheme that
would allow companies with
outstanding performance records to
operate under an alternative compliance
program. MMS is investigating ways to
develop an improved regulatory
program that is more efficient and
responsive to evolving conditions.
DATES: MMS will consider all comments
received by August 21, 2006. MMS will
begin reviewing comments then and
may not fully consider comments
received after August 21, 2006.
ADDRESSES: You may submit comments
on the notice by any of the following
methods listed below. Please use 1010–
AD15 as an identifier in your message.
See also Public Comment Policy under
SUPPLEMENTARY INFORMATION.
• MMS’s Public Connect on-line
commenting system, https://
ocsconnect.mms.gov. Follow the
instructions on the Web site for
submitting comments.
• Federal eRulemaking Portal: https://
www.regulations.gov. Follow the
instructions on the Web site for
submitting comments.
• E-mail MMS at
rules.comments@mms.gov. Use the
Regulatory Identifier Number (RIN) in
the subject line.
• Fax: 703–787–1546. Identify with
RIN.
• Mail or hand-carry comments to the
Department of the Interior; Minerals
Management Service; Attention: Rules
Processing Team (RPT); 381 Elden
Street, MS–4024; Herndon, Virginia
20170–4817. Please reference ‘‘Oil and
Gas and Sulphur Operations in the
OCS—Safety and Environmental
Management Systems—AD15’’ in your
comments.
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15:16 May 19, 2006
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David Nedorostek, Safety and
Enforcement Branch at (703) 787–1029
or William Hauser, Chief, Regulations
and Standards Branch at (703) 787–
1613.
SUPPLEMENTARY INFORMATION:
Public Comment Procedures
MMS’s practice is to make comments,
including names and addresses of
respondents, available for public
review. Individual respondents may
request that we withhold their address
from the record, which we will honor to
the extent allowable by law. There may
be circumstances in which we would
withhold from the rulemaking record a
respondent’s identity, as allowable by
law. If you wish us to withhold your
name and/or address, you must state
this prominently at the beginning of
your comment. However, we will not
consider anonymous comments. We
will make all submissions from
organizations or businesses, and from
individuals identifying themselves as
representatives or officials of
organizations or businesses, available
for public inspection in their entirety.
Regulatory Background
Under the OCS Lands Act, all
activities conducted on the OCS must be
in accordance with existing Federal
statutes. MMS is responsible for
implementing policies intended to
maintain safety and environmental
protection practiced by the industry
while conducting operations in the
OCS. The operator conducting the
operation(s) is directly responsible for
managing the performance of those
operations safely and ensuring they
prevent damage to the environment.
This is the case whether the
management of operations is through
operator company personnel, contract
personnel, or a mix of both.
MMS Goal
The MMS goal is twofold. MMS wants
to improve upon the current regulatory
approach to safety and environmental
management systems to further
minimize injuries, fatalities, accidents,
fires, explosions, collisions, pollution
incidents, or damage to the marine
environment with respect to all oil and
gas operations on the OCS. MMS is
considering moving away from
prescriptive regulations in areas where
industry can demonstrate that a
performance-based regulatory approach
will increase the current level of safety
and environmental protection. MMS
also wants to improve the efficiency of
the current regulatory system by making
it more responsive to innovative
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29277
approaches and technological and
environmental changes. MMS realizes
the challenges in attaining such goals
and recognizes the progress of industry
as a whole in moving toward these
goals.
The Regulatory Program
MMS’s implementing regulations
have both prescriptive and performance
elements. MMS regulations require
industry to submit various site-specific
plans and permit requests for MMS
approval before operations can begin.
There are many engineering-based
requirements for installing, maintaining,
testing, and inspecting of safety control
devices by the operator. MMS’s
operating regulations incorporates 95
referenced standards. The rate of
technological change as operations
move into increasingly challenging
environments has made it difficult for
MMS to promulgate regulations and
participate in the development of
industry standards in a timely manner.
MMS’s performance-based elements
include safety, training, and broadbased environmental protections:
Performance Standards, 30 CFR
250.106–124; Disqualification, 30 CFR
250.135 and 136; Subpart O, Well
Control and Production Safety Training,
30 CFR 250.1500–1510; Best Available
and Safest Technology, 30 CFR 250.105;
the use of alternative technologies, 30
CFR 250.141 and 30 CFR 250.408;
Pollution Prevention Control, 30 CFR
250.300(a); Drilling Operations, 30 CFR
250.401(e); Well Completions, 30 CFR
250.500; Workover Operations, 30 CFR
250.600; Production Safety Systems, 30
CFR 800; Sulfur Operations, 30 CFR
250.1600; and Decommissioning, 30
CFR 250.1703(f).
SEMP and API RP 75 History
For the past 15 years, MMS has been
engaged in an effort to extend the use of
performance-based regulations on the
OCS. In 1991, MMS introduced the
concept of a Safety and Environmental
Management Program (SEMP) with the
goal of having operators in the offshore
industry voluntarily adopt an active
safety and environmental management
approach in conducting operations. The
American Petroleum Institute (API)
responded by developing API RP 75,
‘‘Recommended Practice for
Development of a Safety and
Environmental Management Program for
Offshore Operations and Facilities’’ in
collaboration with industry
organizations and MMS.
The SEMP concept in API RP 75
includes the following 12 elements:
1. Safety and Environmental
Information,
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Federal Register / Vol. 71, No. 98 / Monday, May 22, 2006 / Proposed Rules
2. Hazards Analysis,
3. Management of Change,
4. Operating Procedures,
5. Safe Work Practices,
6. Training,
7. Assurance of Quality and
Mechanical Integrity of Critical
Equipment,
8. Pre-Startup Review,
9. Emergency Response and Control.
10. Investigation of Incidents,
11. Audit of Safety and
Environmental Management Program
Elements, and
12. Documentation and Record
Keeping.
After development of API RP 75,
MMS worked with the offshore industry
to develop tools that would assist the
industry in voluntarily moving toward
use of this management-based approach,
including: (1) Development of a
prototype SEMP program through a
Department of Energy funded contract;
(2) development of SEMP Auditing
Protocols through work with the
Offshore Operators Committee (OOC)
and API; and (3) participation in a series
of six performance measures workshops
(1998–2000) focused on continual
improvement of safety and
environmental management
performance.
In 1994, MMS committed to monitor
industry implementation of SEMP for 2
years to decide whether voluntary use of
API RP 75 was adequately embraced by
industry and to determine if SEMP
would need to be formally incorporated
into our regulations to assure industry’s
use of this program. In June 1996, MMS
extended the observation period. Since
that time MMS has continued to observe
industry implementation. During 1994–
1998, the API developed and distributed
surveys to assist the MMS in gauging
the degree of industry adoption and
implementation of API RP 75.
In 1997, MMS began conducting
annual performance reviews of each
operator. These annual reviews examine
the operator’s compliance history as it
relates to the MMS Inspection Program,
actions MMS has forwarded for civil
penalty review or that have resulted in
a civil penalty, the operator’s safety
record as it relates to accidents and
incidents, and the operator’s progress in
implementing SEMP.
In 2002, at the request of MMS,
members of API and OOC joined with
the agency and formed a Steering
Committee to address our concern with
enhancing the environmental
component of API RP 75. In response,
the Steering Committee rewrote API RP
75 to incorporate concepts from the
International Organization for
Standardization (ISO) 14001—
Environmental Management Systems.
Rationale for Changes in the Regulatory
Program
The overall objective is to improve
our regulatory system and industry
performance by requiring all operators
to manage safety and environmental
performance in an integrated system.
Based on incident investigation
findings and performance reviews with
operators, MMS identified a need for
performance improvement in the
following areas at a minimum: hazards
analysis, operating procedures,
mechanical integrity, and management
of change. These areas are part of what
MMS and industry have recognized as
an effective safety management system.
Requiring operators to implement these
critical elements of an integrated safety
management system could address
MMS’s concerns with performance and
ultimately improve safety and
environmental compliance on the OCS.
MMS believes that the effective use of
SEMS would improve safety and
environmental performance on the OCS.
MMS evaluated several areas of
statistics listed below. In summary,
these areas are: panel investigation
reports, incident analysis, and incidents
of noncompliance (INCs).
Accident panel investigation reports
show major accidents that occurred
from 2000 to 2005. An analysis of the
panel reports reveals that many fatalities
and injuries occurred while performing
routine tasks. In addition, most of these
panel reports made recommendations
that relate to one of the following four
SEMS elements: hazards analysis,
management of change, mechanical
integrity, and operating procedures. The
panel reports can be viewed by typing
in the following address: https://
www.gomr.mms.gov/homepg/offshore/
safety/acc_repo/accindex.html.
CONTRIBUTING CAUSES
Hazard
analysis
rmajette on PROD1PC67 with PROPOSALS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
MMS
2005–027
2005–007
2004–078
2004–075
2004–048
2004–046
2004–004
2003–068
2003–046
2003–023
2002–076
2002–075
2002–062
2002–059
2002–040
2001–084
2001–045
2001–042
2001–010
2001–009
2001–005
2000–089
................................................................
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Total = 22
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Operating
procedures
Mechanical
integrity
Management of
change
Injury No.
....................
....................
X
X
....................
X
X
....................
....................
....................
X
X
....................
X
....................
....................
....................
X
X
....................
X
X
X
X
X
X
....................
X
....................
X
X
....................
....................
....................
....................
....................
....................
....................
X
....................
....................
X
....................
....................
X
X
....................
X
....................
....................
....................
....................
....................
....................
X
....................
....................
X
X
....................
X
X
....................
....................
....................
X
X
....................
X
....................
....................
X
....................
....................
X
X
X
....................
X
....................
....................
X
....................
X
X
X
X
....................
....................
....................
....................
....................
....................
3
....................
....................
....................
....................
....................
....................
2
1
....................
....................
....................
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1
....................
....................
....................
Total = 11
MMS report
Total = 9
Total = 9
Total = 12
Total = 7
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22MYP1
Fatality No.
1
1
1
1
1
1
1
1
1
Total = 9
Federal Register / Vol. 71, No. 98 / Monday, May 22, 2006 / Proposed Rules
It is evident from the above table that
the accidents covered by 11 of the 22
panel reports resulted in a combined 16
fatalities and injuries. The analysis done
on the accidents identified six primary
contributing causes: (1) A lack of
communication between operator and
contractor(s), (2) lack of understanding
job hazards analysis (JHA) prior to
beginning work or lack of JHA written
procedures, (3) onsite supervision not
enforcing existing procedures or
practices, (4) lack of written safe work
procedural guidelines, (5) integrity of
the facilities and equipment not
maintained according to recommended
practices, and (6) workplace hazards not
identified and corrected. MMS
maintains that these incidents could
have been minimized or even prevented
if the operator had implemented the
four identified SEMS elements.
The MMS also conducted a study of
310 incidents that occurred in OCS
waters in 2003 and 2004, to determine
if the events were associated with any
of the four SEMS elements. The events
reviewed included: fatalities, injuries,
loss of well control, collisions, fires,
pollution, and crane events. This study
revealed that there were 13 fatalities and
97 injuries in the 310 incidents. A
majority of the incidents had at least
one of the following four factors as a
contributing reason for the event
occurring.
SEMS element
Number of
occurrence(s)
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Hazard Analysis ................
Management of Change ...
Mechanical Integrity ..........
Operating Procedures ......
20
13
124
159
MMS inspectors issue three primary
Incidents of Noncompliance (INCs) that
address four key elements of a SEMS
program. These INCs are as follows:
• G–110 (Operations conducted in a
safe and workmanlike manner),
• G–111 (Equipment maintained in a
safe condition), and
• G–112 (Safety of personnel and are
all necessary precautions taken to
correct and remove any hazards).
MMS issued 1,381 of these types of
INCs during 2003–2004 for drilling and
production activities. Of these 1,381
INCs, 1,376 or 99.6 percent are directly
related to one or more of the following
four SEMS elements: hazard analysis,
operating procedures, mechanical
integrity, and management of change.
The following table depicts these G–
INCs written for drilling activities and
production activities.
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Operational Incs Issued in 2003–2004
Drilling
Production
Percentage
29279
Possible Options for Implementing
SEMS
Percentage
There are a number of approaches
MMS could adopt in moving to a SEMS
requirement. We request your views on
Hazard Analysis.
6
3 the following approaches and any others
that you would like us to consider for
Management Of
Change. .........
19
5 implementing a SEMS program.
Mechanical In1. Keep the Current Regulatory
tegrity. ...........
42
46 Program—the current program is largely
Operating Probased on overarching performancecedures. ........
33
46 based regulations supplemented by
specific prescriptive safety and
Environmental Compliance
environmental regulations and
requirements where necessary. The use
MMS also reviewed its Environmental of API RP 75, while encouraged, is
Potential Incidents of Noncompliance
strictly voluntary.
(PINCs) and Performance Standards.
2. A Mandatory Limited SEMS
The review of our environmental
Approach—continue the current
performance standards and our
regulatory regime and add the four
environmental PINCs indicates that the
critical SEMS elements—hazard
PINCs do not fully address the range of
analysis, management of change,
environmental safeguards covered
operating procedures, and mechanical
under our performance standards as
integrity.
they relate to compliance with State and
3. A Complete SEMS Approach—a
Federal statutes. The environmental
new performance-based comprehensive
PINCs issued by MMS inspectors focus
safety and environmental management
on water quality as it relates to mud/oil
approach. The MMS would develop
spills and marine debris (E–100 thru E– performance-based regulations that
202); flaring and venting violations (P–
address the 12 elements from API RP 75
107 thru P–111); and broad-based
and elements similar in nature to those
noncompliance with lease stipulations
detailed in Section 4 of ISO 14001.
and ‘‘approved plans/’’applications (G–
Enforcement of SEMS Requirement
114 thru G–116). MMS has limited
A template available to MMS for
methods to verify and document
industry compliance with the regulatory enforcing a performance-based
regulation has been developed as part of
performance standards.
our 30 CFR Part 250 Subpart O Well
MMS issues hundreds of
Control and Production Safety Training
environmental (E—INCs) every year.
regulations. Under subpart O, an
There is no discernible trend of
operator is required to develop and
improvement by industry over the past
implement a training plan that complies
5 years. The number of INCs issued
with the provisions of our regulations.
concerning maintenance of pollution
These regulations set out broad goals
inspection records have continually
and leave the operator the flexibility to
increased from 2000–2005. MMS
determine how best to comply. Under
realizes that our current approach to
this system, MMS does not approve the
environmental protection does not
plan, but expects the operator to show
allow us to ascertain the level of
us how they have complied with the
industry compliance with all applicable provisions in their plan when asked. To
environmental laws, regulations, and
evaluate an operator’s performance
lease stipulations. We believe that
under the subpart O regulations, MMS
industry’s SEMS plan should contain
has the following tools available:
processes and protocols for detailing
1. Informal employee interviews,
their compliance with these
2. Audits:
requirements. MMS is aware that
• Formal interviews
industry may be documenting
• Training plan reviews
compliance in ways that MMS does not
• Records review
currently verify and track, and that
• Course content evaluations
industry may be investigating ways to
3. Testing:
better demonstrate environmental
• Written
compliance. MMS is considering a range
• Verbal
of options for ensuring industry
• Hands-on.
compliance with environmental
MMS views the subpart O approach
regulations and is seeking comment on
as a viable option for enforcing
how industry can demonstrate to MMS
additional performance-based
their compliance with these
regulations, such as SEMS, but
requirements.
welcomes any suggestions and
SEMS elements
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Federal Register / Vol. 71, No. 98 / Monday, May 22, 2006 / Proposed Rules
information concerning other
techniques.
Alternative Compliance Program
The MMS is considering a SEMS pilot
program under which a limited number
of companies with outstanding
performance records, as demonstrated
by incident and compliance data, would
manage their operations under a
comprehensive SEMS program. For the
duration of the pilot program, these
companies would operate under a
separate regulatory program with far
fewer prescriptive requirements.
The intention of the pilot program is
threefold:
1. Determine whether SEMS should
be expanded beyond a voluntary
regulatory program;
2. Provide MMS with experience in
auditing and using SEMS as a regulatory
program vehicle to ensure safe and
clean operations; and
3. Determine if SEMS is practical for
the oil and gas industry as a whole or
only specific companies. MMS
envisions that any company qualifying
for the SEMS pilot program would
operate according to their SEMS plan
and would be relieved from information
submissions, certain applications and
discrete MMS approval actions except
those specifically required by law. If a
company is found to be out of
compliance with their SEMS plan, then
incidents of noncompliance and
possibly civil penalties could result. It
is projected that the pilot program will
operate with companies needing to
qualify on a periodic basis. Companies
interested in the pilot program should
have a fully functioning SEMS program
with a verifiable history showing how
their program has had a positive impact
on the safety of their operations.
Questions
The purpose of this ANPR is to seek
input from industry and other interested
parties on the three SEMS approaches
described above. In addition to
receiving input on the approaches
identified in this ANPR, this process
will also allow MMS to evaluate
alternative ideas. MMS invites specific
comments on the following:
rmajette on PROD1PC67 with PROPOSALS
SEMS Approaches
• Which of the three identified
approaches do you consider most
responsive to MMS’s stated goals and
why?
• Are there other safety and
environmental management systems or
programs that MMS should review?
Please provide as much detail as
possible.
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15:16 May 19, 2006
Jkt 208001
• Does the subpart O model using
audits, informal employee interviews,
and testing described above, provide a
suitable model for verifying the
implementation of a performance-based
safety and environmental management
program? Are there alternative
approaches to the subpart O model that
the MMS should consider?
• Should MMS or a third party verify
that a performance-based safety and
environmental management program is
working? Should audits be periodic or
should they be triggered by events or
indicators?
• Should MMS review the SEMS
plan, review and approve the SEMS
plan, or have an independent third
party verify, review, and approve the
SEMS plan?
• Should SEMS plans be in addition
to the current prescriptive regulations or
should the SEMS plan be in lieu of
certain prescriptive regulations?
• What standards should a SEMS
plan include to provide consistent and
credible approaches to offshore
operational safety and environmental
performance?
—Would these documents, standards, or
guidelines be domestic or
international?
—Would these documents, standards, or
guidelines be accepted industry best
practices or internal company policies
and procedures?
• What criteria should the MMS use
to determine whether an operator has a
viable SEMS plan?
• Is API RP 75 a sufficient model for
addressing all the factors associated
with offshore industry practices? If not,
please provide the MMS with your
suggestions on an appropriate model.
• Are there existing programs or
initiatives industry is currently using
that can further our ability to verify and
track environmental compliance, such
as ISO 14001:2004, SempCheck,
European Eco-Management and Audit
Scheme, or Global Environmental
Management Initiative.
• How can MMS improve its current
regulatory model to incorporate
environmental performance
measurement systems?
• What are the most appropriate
compliance measures that are
responsive to our broad environmental
performance standards referenced in the
‘‘The Regulatory Program’’ section
above?
Alternative Compliance Program
Should MMS consider developing a
‘‘pilot program’’ to assess an alternative
compliance program for outstanding
operators?
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• What measure(s) should we use to
determine who is allowed to
participate?
• How should MMS judge
prospective ‘‘pilot program’’ applicants?
Should an applicant be required to
submit a complete SEMS program or
plan to MMS for evaluation? Should
MMS approve such a program?
• Should a pilot program be for a
fixed period of time? How long?
• Should performance issues trigger a
premature end to an operator’s
participation in a pilot program?
• What measures should be
considered?
• What type of MMS regulatory
regime do you recommend for
companies in a pilot program?
• What prescriptive regulations and
permitting requirements should be
excluded from this alternative
regulatory program?
• What advantages does a SEMS
regulatory approach have for companies
compared to prescriptive approach?
• What disadvantage does a SEMS
regulatory approach have for companies
as compared to a prescriptive approach?
• Should the SEMS pilot program
include only four elements as
mentioned above or should it be for all
12 elements?
MMS seeks responses to the above
questions, an assessment of which
option industry considers the most
effective and efficient, and any other
information deemed relevant that is not
specifically asked for. After analyzing
the comments received from this notice,
MMS will determine the need for a
public workshop to further exchange
ideas. MMS encourages all interested
parties to respond to these questions
and to provide comments on the various
options.
Dated: May 3, 2006.
R.M. Johnnie Burton,
Director, Minerals Management Service.
[FR Doc. E6–7790 Filed 5–19–06; 8:45 am]
BILLING CODE 4310–MR–P
DEPARTMENT OF THE INTERIOR
Minerals Management Service
30 CFR Part 250
RIN 1010–AD19
Oil and Gas and Sulphur Operations in
the Outer Continental Shelf (OCS)—
Incorporate API RP 65 for Cementing
Shallow Water Flow Zones
Minerals Management Service
(MMS), Interior.
ACTION: Proposed rule.
AGENCY:
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]]>Agencies
[Federal Register Volume 71, Number 98 (Monday, May 22, 2006)]
[Proposed Rules]
[Pages 29277-29280]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-7790]
[[Page 29277]]
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DEPARTMENT OF THE INTERIOR
Minerals Management Service
30 CFR Part 250
RIN 1010-AD15
Oil and Gas and Sulphur in the Outer Continental Shelf (OCS)--
Safety and Environmental Management Systems
AGENCY: Minerals Management Service (MMS), Interior.
ACTION: Advance Notice of Proposed Rulemaking (ANPR).
-----------------------------------------------------------------------
SUMMARY: MMS is seeking comments on how to improve our regulatory
approach to safety and environmental management systems (SEMS) for
operations conducted in the OCS. The various approaches for SEMS
include voluntary and mandatory implementation of partial and full
SEMS. In addition, the MMS is seeking comments on a regulatory scheme
that would allow companies with outstanding performance records to
operate under an alternative compliance program. MMS is investigating
ways to develop an improved regulatory program that is more efficient
and responsive to evolving conditions.
DATES: MMS will consider all comments received by August 21, 2006. MMS
will begin reviewing comments then and may not fully consider comments
received after August 21, 2006.
ADDRESSES: You may submit comments on the notice by any of the
following methods listed below. Please use 1010-AD15 as an identifier
in your message. See also Public Comment Policy under Supplementary
Information.
MMS's Public Connect on-line commenting system, https://
ocsconnect.mms.gov. Follow the instructions on the Web site for
submitting comments.
Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions on the Web site for submitting comments.
E-mail MMS at rules.comments@mms.gov. Use the Regulatory
Identifier Number (RIN) in the subject line.
Fax: 703-787-1546. Identify with RIN.
Mail or hand-carry comments to the Department of the
Interior; Minerals Management Service; Attention: Rules Processing Team
(RPT); 381 Elden Street, MS-4024; Herndon, Virginia 20170-4817. Please
reference ``Oil and Gas and Sulphur Operations in the OCS--Safety and
Environmental Management Systems--AD15'' in your comments.
FOR FURTHER INFORMATION CONTACT: David Nedorostek, Safety and
Enforcement Branch at (703) 787-1029 or William Hauser, Chief,
Regulations and Standards Branch at (703) 787-1613.
SUPPLEMENTARY INFORMATION:
Public Comment Procedures
MMS's practice is to make comments, including names and addresses
of respondents, available for public review. Individual respondents may
request that we withhold their address from the record, which we will
honor to the extent allowable by law. There may be circumstances in
which we would withhold from the rulemaking record a respondent's
identity, as allowable by law. If you wish us to withhold your name
and/or address, you must state this prominently at the beginning of
your comment. However, we will not consider anonymous comments. We will
make all submissions from organizations or businesses, and from
individuals identifying themselves as representatives or officials of
organizations or businesses, available for public inspection in their
entirety.
Regulatory Background
Under the OCS Lands Act, all activities conducted on the OCS must
be in accordance with existing Federal statutes. MMS is responsible for
implementing policies intended to maintain safety and environmental
protection practiced by the industry while conducting operations in the
OCS. The operator conducting the operation(s) is directly responsible
for managing the performance of those operations safely and ensuring
they prevent damage to the environment. This is the case whether the
management of operations is through operator company personnel,
contract personnel, or a mix of both.
MMS Goal
The MMS goal is twofold. MMS wants to improve upon the current
regulatory approach to safety and environmental management systems to
further minimize injuries, fatalities, accidents, fires, explosions,
collisions, pollution incidents, or damage to the marine environment
with respect to all oil and gas operations on the OCS. MMS is
considering moving away from prescriptive regulations in areas where
industry can demonstrate that a performance-based regulatory approach
will increase the current level of safety and environmental protection.
MMS also wants to improve the efficiency of the current regulatory
system by making it more responsive to innovative approaches and
technological and environmental changes. MMS realizes the challenges in
attaining such goals and recognizes the progress of industry as a whole
in moving toward these goals.
The Regulatory Program
MMS's implementing regulations have both prescriptive and
performance elements. MMS regulations require industry to submit
various site-specific plans and permit requests for MMS approval before
operations can begin. There are many engineering-based requirements for
installing, maintaining, testing, and inspecting of safety control
devices by the operator. MMS's operating regulations incorporates 95
referenced standards. The rate of technological change as operations
move into increasingly challenging environments has made it difficult
for MMS to promulgate regulations and participate in the development of
industry standards in a timely manner. MMS's performance-based elements
include safety, training, and broad-based environmental protections:
Performance Standards, 30 CFR 250.106-124; Disqualification, 30 CFR
250.135 and 136; Subpart O, Well Control and Production Safety
Training, 30 CFR 250.1500-1510; Best Available and Safest Technology,
30 CFR 250.105; the use of alternative technologies, 30 CFR 250.141 and
30 CFR 250.408; Pollution Prevention Control, 30 CFR 250.300(a);
Drilling Operations, 30 CFR 250.401(e); Well Completions, 30 CFR
250.500; Workover Operations, 30 CFR 250.600; Production Safety
Systems, 30 CFR 800; Sulfur Operations, 30 CFR 250.1600; and
Decommissioning, 30 CFR 250.1703(f).
SEMP and API RP 75 History
For the past 15 years, MMS has been engaged in an effort to extend
the use of performance-based regulations on the OCS. In 1991, MMS
introduced the concept of a Safety and Environmental Management Program
(SEMP) with the goal of having operators in the offshore industry
voluntarily adopt an active safety and environmental management
approach in conducting operations. The American Petroleum Institute
(API) responded by developing API RP 75, ``Recommended Practice for
Development of a Safety and Environmental Management Program for
Offshore Operations and Facilities'' in collaboration with industry
organizations and MMS.
The SEMP concept in API RP 75 includes the following 12 elements:
1. Safety and Environmental Information,
[[Page 29278]]
2. Hazards Analysis,
3. Management of Change,
4. Operating Procedures,
5. Safe Work Practices,
6. Training,
7. Assurance of Quality and Mechanical Integrity of Critical
Equipment,
8. Pre-Startup Review,
9. Emergency Response and Control.
10. Investigation of Incidents,
11. Audit of Safety and Environmental Management Program Elements,
and
12. Documentation and Record Keeping.
After development of API RP 75, MMS worked with the offshore
industry to develop tools that would assist the industry in voluntarily
moving toward use of this management-based approach, including: (1)
Development of a prototype SEMP program through a Department of Energy
funded contract; (2) development of SEMP Auditing Protocols through
work with the Offshore Operators Committee (OOC) and API; and (3)
participation in a series of six performance measures workshops (1998-
2000) focused on continual improvement of safety and environmental
management performance.
In 1994, MMS committed to monitor industry implementation of SEMP
for 2 years to decide whether voluntary use of API RP 75 was adequately
embraced by industry and to determine if SEMP would need to be formally
incorporated into our regulations to assure industry's use of this
program. In June 1996, MMS extended the observation period. Since that
time MMS has continued to observe industry implementation. During 1994-
1998, the API developed and distributed surveys to assist the MMS in
gauging the degree of industry adoption and implementation of API RP
75.
In 1997, MMS began conducting annual performance reviews of each
operator. These annual reviews examine the operator's compliance
history as it relates to the MMS Inspection Program, actions MMS has
forwarded for civil penalty review or that have resulted in a civil
penalty, the operator's safety record as it relates to accidents and
incidents, and the operator's progress in implementing SEMP.
In 2002, at the request of MMS, members of API and OOC joined with
the agency and formed a Steering Committee to address our concern with
enhancing the environmental component of API RP 75. In response, the
Steering Committee rewrote API RP 75 to incorporate concepts from the
International Organization for Standardization (ISO) 14001--
Environmental Management Systems.
Rationale for Changes in the Regulatory Program
The overall objective is to improve our regulatory system and
industry performance by requiring all operators to manage safety and
environmental performance in an integrated system.
Based on incident investigation findings and performance reviews
with operators, MMS identified a need for performance improvement in
the following areas at a minimum: hazards analysis, operating
procedures, mechanical integrity, and management of change. These areas
are part of what MMS and industry have recognized as an effective
safety management system. Requiring operators to implement these
critical elements of an integrated safety management system could
address MMS's concerns with performance and ultimately improve safety
and environmental compliance on the OCS.
MMS believes that the effective use of SEMS would improve safety
and environmental performance on the OCS. MMS evaluated several areas
of statistics listed below. In summary, these areas are: panel
investigation reports, incident analysis, and incidents of
noncompliance (INCs).
Accident panel investigation reports show major accidents that
occurred from 2000 to 2005. An analysis of the panel reports reveals
that many fatalities and injuries occurred while performing routine
tasks. In addition, most of these panel reports made recommendations
that relate to one of the following four SEMS elements: hazards
analysis, management of change, mechanical integrity, and operating
procedures. The panel reports can be viewed by typing in the following
address: https://www.gomr.mms.gov/homepg/offshore/safety/acc_repo/
accindex.html.
Contributing Causes
----------------------------------------------------------------------------------------------------------------
Hazard Operating Mechanical Management
MMS report analysis procedures integrity of change Injury No. Fatality No.
----------------------------------------------------------------------------------------------------------------
MMS 2005-027................ ............ X X X ............ ............
MMS 2005-007................ ............ X X ............ ............ ............
MMS 2004-078................ X X ............ X ............ 1
MMS 2004-075................ X X X ............ ............ ............
MMS 2004-048................ ............ ............ ............ ............ ............ ............
MMS 2004-046................ X X ............ X 3 ............
MMS 2004-004................ X ............ ............ ............ ............ 1
MMS 2003-068................ ............ X ............ ............ ............ ............
MMS 2003-046................ ............ X ............ X ............ ............
MMS 2003-023................ ............ ............ ............ X ............ ............
MMS 2002-076................ X ............ X X ............ 1
MMS 2002-075................ X ............ ............ ............ ............ 1
MMS 2002-062................ ............ ............ ............ X 2 1
MMS 2002-059................ X ............ X ............ 1 1
MMS 2002-040................ ............ ............ X ............ ............ ............
MMS 2001-084................ ............ ............ ............ X ............ ............
MMS 2001-045................ ............ X X ............ ............ 1
MMS 2001-042................ X ............ X X ............ 1
MMS 2001-010................ X ............ ............ X 1 ............
MMS 2001-009................ ............ X ............ X ............ ............
MMS 2001-005................ X ............ ............ X ............ ............
MMS 2000-089................ X ............ X ............ ............ 1
-----------------------------------------------------------------------------------
Total = 22 Total = 11 Total = 9 Total = 9 Total = 12 Total = 7 Total = 9
----------------------------------------------------------------------------------------------------------------
[[Page 29279]]
It is evident from the above table that the accidents covered by 11
of the 22 panel reports resulted in a combined 16 fatalities and
injuries. The analysis done on the accidents identified six primary
contributing causes: (1) A lack of communication between operator and
contractor(s), (2) lack of understanding job hazards analysis (JHA)
prior to beginning work or lack of JHA written procedures, (3) onsite
supervision not enforcing existing procedures or practices, (4) lack of
written safe work procedural guidelines, (5) integrity of the
facilities and equipment not maintained according to recommended
practices, and (6) workplace hazards not identified and corrected. MMS
maintains that these incidents could have been minimized or even
prevented if the operator had implemented the four identified SEMS
elements.
The MMS also conducted a study of 310 incidents that occurred in
OCS waters in 2003 and 2004, to determine if the events were associated
with any of the four SEMS elements. The events reviewed included:
fatalities, injuries, loss of well control, collisions, fires,
pollution, and crane events. This study revealed that there were 13
fatalities and 97 injuries in the 310 incidents. A majority of the
incidents had at least one of the following four factors as a
contributing reason for the event occurring.
------------------------------------------------------------------------
Number of
SEMS element occurrence(s)
------------------------------------------------------------------------
Hazard Analysis....................................... 20
Management of Change.................................. 13
Mechanical Integrity.................................. 124
Operating Procedures.................................. 159
------------------------------------------------------------------------
MMS inspectors issue three primary Incidents of Noncompliance
(INCs) that address four key elements of a SEMS program. These INCs are
as follows:
G-110 (Operations conducted in a safe and workmanlike
manner),
G-111 (Equipment maintained in a safe condition), and
G-112 (Safety of personnel and are all necessary
precautions taken to correct and remove any hazards).
MMS issued 1,381 of these types of INCs during 2003-2004 for
drilling and production activities. Of these 1,381 INCs, 1,376 or 99.6
percent are directly related to one or more of the following four SEMS
elements: hazard analysis, operating procedures, mechanical integrity,
and management of change. The following table depicts these G-INCs
written for drilling activities and production activities.
------------------------------------------------------------------------
Operational Incs Issued in 2003-2004
-------------------------------------------------------------------------
Drilling Production
------------------------------------------------------------------------
SEMS elements Percentage Percentage
------------------------------------------------------------------------
Hazard Analysis............................... 6 3
Management Of Change.......................... 19 5
Mechanical Integrity.......................... 42 46
Operating Procedures.......................... 33 46
------------------------------------------------------------------------
Environmental Compliance
MMS also reviewed its Environmental Potential Incidents of
Noncompliance (PINCs) and Performance Standards. The review of our
environmental performance standards and our environmental PINCs
indicates that the PINCs do not fully address the range of
environmental safeguards covered under our performance standards as
they relate to compliance with State and Federal statutes. The
environmental PINCs issued by MMS inspectors focus on water quality as
it relates to mud/oil spills and marine debris (E-100 thru E-202);
flaring and venting violations (P-107 thru P-111); and broad-based
noncompliance with lease stipulations and ``approved plans/
''applications (G-114 thru G-116). MMS has limited methods to verify
and document industry compliance with the regulatory performance
standards.
MMS issues hundreds of environmental (E--INCs) every year. There is
no discernible trend of improvement by industry over the past 5 years.
The number of INCs issued concerning maintenance of pollution
inspection records have continually increased from 2000-2005. MMS
realizes that our current approach to environmental protection does not
allow us to ascertain the level of industry compliance with all
applicable environmental laws, regulations, and lease stipulations. We
believe that industry's SEMS plan should contain processes and
protocols for detailing their compliance with these requirements. MMS
is aware that industry may be documenting compliance in ways that MMS
does not currently verify and track, and that industry may be
investigating ways to better demonstrate environmental compliance. MMS
is considering a range of options for ensuring industry compliance with
environmental regulations and is seeking comment on how industry can
demonstrate to MMS their compliance with these requirements.
Possible Options for Implementing SEMS
There are a number of approaches MMS could adopt in moving to a
SEMS requirement. We request your views on the following approaches and
any others that you would like us to consider for implementing a SEMS
program.
1. Keep the Current Regulatory Program--the current program is
largely based on overarching performance-based regulations supplemented
by specific prescriptive safety and environmental regulations and
requirements where necessary. The use of API RP 75, while encouraged,
is strictly voluntary.
2. A Mandatory Limited SEMS Approach--continue the current
regulatory regime and add the four critical SEMS elements--hazard
analysis, management of change, operating procedures, and mechanical
integrity.
3. A Complete SEMS Approach--a new performance-based comprehensive
safety and environmental management approach. The MMS would develop
performance-based regulations that address the 12 elements from API RP
75 and elements similar in nature to those detailed in Section 4 of ISO
14001.
Enforcement of SEMS Requirement
A template available to MMS for enforcing a performance-based
regulation has been developed as part of our 30 CFR Part 250 Subpart O
Well Control and Production Safety Training regulations. Under subpart
O, an operator is required to develop and implement a training plan
that complies with the provisions of our regulations. These regulations
set out broad goals and leave the operator the flexibility to determine
how best to comply. Under this system, MMS does not approve the plan,
but expects the operator to show us how they have complied with the
provisions in their plan when asked. To evaluate an operator's
performance under the subpart O regulations, MMS has the following
tools available:
1. Informal employee interviews,
2. Audits:
Formal interviews
Training plan reviews
Records review
Course content evaluations
3. Testing:
Written
Verbal
Hands-on.
MMS views the subpart O approach as a viable option for enforcing
additional performance-based regulations, such as SEMS, but welcomes
any suggestions and
[[Page 29280]]
information concerning other techniques.
Alternative Compliance Program
The MMS is considering a SEMS pilot program under which a limited
number of companies with outstanding performance records, as
demonstrated by incident and compliance data, would manage their
operations under a comprehensive SEMS program. For the duration of the
pilot program, these companies would operate under a separate
regulatory program with far fewer prescriptive requirements.
The intention of the pilot program is threefold:
1. Determine whether SEMS should be expanded beyond a voluntary
regulatory program;
2. Provide MMS with experience in auditing and using SEMS as a
regulatory program vehicle to ensure safe and clean operations; and
3. Determine if SEMS is practical for the oil and gas industry as a
whole or only specific companies. MMS envisions that any company
qualifying for the SEMS pilot program would operate according to their
SEMS plan and would be relieved from information submissions, certain
applications and discrete MMS approval actions except those
specifically required by law. If a company is found to be out of
compliance with their SEMS plan, then incidents of noncompliance and
possibly civil penalties could result. It is projected that the pilot
program will operate with companies needing to qualify on a periodic
basis. Companies interested in the pilot program should have a fully
functioning SEMS program with a verifiable history showing how their
program has had a positive impact on the safety of their operations.
Questions
The purpose of this ANPR is to seek input from industry and other
interested parties on the three SEMS approaches described above. In
addition to receiving input on the approaches identified in this ANPR,
this process will also allow MMS to evaluate alternative ideas. MMS
invites specific comments on the following:
SEMS Approaches
Which of the three identified approaches do you consider
most responsive to MMS's stated goals and why?
Are there other safety and environmental management
systems or programs that MMS should review? Please provide as much
detail as possible.
Does the subpart O model using audits, informal employee
interviews, and testing described above, provide a suitable model for
verifying the implementation of a performance-based safety and
environmental management program? Are there alternative approaches to
the subpart O model that the MMS should consider?
Should MMS or a third party verify that a performance-
based safety and environmental management program is working? Should
audits be periodic or should they be triggered by events or indicators?
Should MMS review the SEMS plan, review and approve the
SEMS plan, or have an independent third party verify, review, and
approve the SEMS plan?
Should SEMS plans be in addition to the current
prescriptive regulations or should the SEMS plan be in lieu of certain
prescriptive regulations?
What standards should a SEMS plan include to provide
consistent and credible approaches to offshore operational safety and
environmental performance?
--Would these documents, standards, or guidelines be domestic or
international?
--Would these documents, standards, or guidelines be accepted industry
best practices or internal company policies and procedures?
What criteria should the MMS use to determine whether an
operator has a viable SEMS plan?
Is API RP 75 a sufficient model for addressing all the
factors associated with offshore industry practices? If not, please
provide the MMS with your suggestions on an appropriate model.
Are there existing programs or initiatives industry is
currently using that can further our ability to verify and track
environmental compliance, such as ISO 14001:2004, SempCheck, European
Eco-Management and Audit Scheme, or Global Environmental Management
Initiative.
How can MMS improve its current regulatory model to
incorporate environmental performance measurement systems?
What are the most appropriate compliance measures that are
responsive to our broad environmental performance standards referenced
in the ``The Regulatory Program'' section above?
Alternative Compliance Program
Should MMS consider developing a ``pilot program'' to assess an
alternative compliance program for outstanding operators?
What measure(s) should we use to determine who is allowed
to participate?
How should MMS judge prospective ``pilot program''
applicants? Should an applicant be required to submit a complete SEMS
program or plan to MMS for evaluation? Should MMS approve such a
program?
Should a pilot program be for a fixed period of time? How
long?
Should performance issues trigger a premature end to an
operator's participation in a pilot program?
What measures should be considered?
What type of MMS regulatory regime do you recommend for
companies in a pilot program?
What prescriptive regulations and permitting requirements
should be excluded from this alternative regulatory program?
What advantages does a SEMS regulatory approach have for
companies compared to prescriptive approach?
What disadvantage does a SEMS regulatory approach have for
companies as compared to a prescriptive approach?
Should the SEMS pilot program include only four elements
as mentioned above or should it be for all 12 elements?
MMS seeks responses to the above questions, an assessment of which
option industry considers the most effective and efficient, and any
other information deemed relevant that is not specifically asked for.
After analyzing the comments received from this notice, MMS will
determine the need for a public workshop to further exchange ideas. MMS
encourages all interested parties to respond to these questions and to
provide comments on the various options.
Dated: May 3, 2006.
R.M. Johnnie Burton,
Director, Minerals Management Service.
[FR Doc. E6-7790 Filed 5-19-06; 8:45 am]
BILLING CODE 4310-MR-P
