Overview of UK Offshore Oil and Gas Regulation. Andrew Taylor Head, Offshore Environmental Inspectorate DECC Energy Development Unit February 2016
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1 Overview of UK Offshore Oil and Gas Regulation Andrew Taylor Head, Offshore Environmental Inspectorate DECC Energy Development Unit February 2016
2 1988 Piper Alpha disaster explosion on Occidental s platform led to loss of 167 lives 1990 Piper Alpha inquiry led to transfer of health and safety regulation for offshore to the UK Health and Safety Executive 1998 Department of Trade and Industry sets up separate team to develop and implement comprehensive environmental regulation 2 Overview of UK Offshore Oil & Gas Regulation UK Regulatory Milestones 1964 Single regulator, the UK Department of Energy (DEn) 2014 Wood Review of regulatory regime to secure future of UK offshore industry and related employment 2015 Oil and Gas Authority set up to implement Wood recommendations 2015 Offshore Safety Directive led to creation of joint Competent Authority to implement environmental and health and safety regulations
3 Scope of Operations on UKCS 470 Installations - 58 Licensed Operators 10% floating installations 30% subsea installations 50% small steel installations 10% large steel or concrete installations potential derogations for abandonment Approximately 35,000 km pipelines 10,000 km major pipelines 3 Overview of UK Offshore Oil & Gas Regulation
4 The Oil and Gas Authority (OGA) Offshore oil & gas - Environmental Protection
5 2014 Review (The Wood Review) Key recommendations Sector strategies Urgent need for enhanced stewardship of offshore assets New Maximising Economic Recovery strategy (MER UK) Commitment from industry to collaborate Stronger tripartite relationship between industry, government and regulator New independent regulator with additional powers and resources Prize of additional 3-4 billion barrels 375,000 industry jobs to protect 5 Overview of UK Offshore Oil & Gas Regulation
6 Leadership, Culture & behaviour Creation of the OGA Creating the OGA New independent regulator Effective staff resources to manage assets New powers, better resourced and funded Catalyst for change and facilitator of action Encouraging collaboration To become a separate Government Company Funded through an Industry Levy Focused on delivering MER UK Strategy Role of the OGA Licence offshore oil & gas Licence onshore oil & gas Licence carbon capture & storage Priorities Rapidly implement Industry to urgently take action Trusted advisor to Treasury Industry culture Commercial behaviour Greater collaboration Investment in UKCS Value creation Industry development 6 Overview of UK Offshore Oil & Gas Regulation
7 Structure of the OGA Chief Executive Exploration & Production Licensing & Legal Technology Policy &, Performance HR & Change Finance Licence Stewardship Integrated Area Teams Exploration & New Ventures Metering Gas Storage CO 2 Capture & Storage Licencing Regulation Dispute Resolution & Sanctions General Counsel Onshore Licensing Decommissioning Supply Chain Technology IT, Data & Information Management Strategy & Policy Development Communication & External Affairs Performance, Planning & Reporting Economics & Fiscal Analysis HR Leadership Organisational Development Support internal & industry cultural change Financial Management & Control Governance Procurement Accommodation Manage the Transition to a Government Company (GovCo) New organisation effective from 1 July Overview of UK Offshore Oil & Gas Regulation
8 Main Functions of the OGA Offshore oil and gas exploration and development policy Licensing Exploration Drilling consents Development consents Pipeline authorisations Production consents Fiscal metering Flare and vent consents Asset stewardship and Cessation of production and well abandonment Decommissioning policy and costs 8 Overview of UK Offshore Oil & Gas Regulation
9 The Offshore Oil and Gas Environment and Decommissioning Unit (OGED) Offshore oil & gas - Environmental Protection
10 Department of Energy and Climate Change (DECC) DECC s Energy Development Unit (EDU) is responsible for UK energy policy, including offshore oil and gas, pipelines, power generation and transmission systems The Offshore Oil and Gas Environment and Decommissioning Unit (OGED) is a separate unit within DECC EDU, based in Aberdeen 10 Overview of UK Offshore Oil & Gas Regulation
11 Structure of DECC EDU Energy Development Unit Oil and Gas Authority O&G Environment and Decommissioning Environmental Policy Environmental Management Environmental Inspectorate Decommissioning Unit Offshore Oil and Gas Environment and Decommissioning Unit (OGED) 11 Overview of UK Offshore Oil & Gas Regulation
12 Environmental Teams Environmental Management Team (Policy and Assessment of Operations) Develop and implement policy, and issue approvals for seismic, drilling, infrastructure, production, discharges, emissions etc. Offshore Environmental Inspectorate Team (Enforcement) Issue approvals for oil discharges and Oil Pollution Emergency Plans, and undertake inspections, investigations and enforcement 12 Overview of UK Offshore Oil & Gas Regulation
13 Decommissioning Team Financial security Decontamination of facilities Removal of topsides and jackets Decommissioning of pipelines Derogations (to leave footings / concrete structures in place) Monitoring Long-term liability 13 Overview of UK Offshore Oil & Gas Regulation
14 Main Functions of OGED Environmental and Decommissioning Policy Influencing EU, OSPAR and Domestic Policy Implementing Policy Preparing UK environmental regulations and related guidance, and agreeing voluntary initiatives Management Approvals - environmental impact assessment of proposals, and issuing permits for discharges, emissions and other activities Decommissioning financial security, Decommissioning Programmes, environmental aspects of programme approval, and licensing the decommissioning activities Enforcement Inspections, investigations and prosecutions Secretary of State s Representative 14 Overview of UK Offshore Oil & Gas Regulation
15 The Health and Safety Executive Offshore oil & gas - Environmental Protection
16 Inspect Investigate accidents and incidents Assess safety cases Enforce regulations Advise, guide and inform the industry Undertake and commission research and development Health and Safety Executive (HSE) HSE's Energy Division (ED) is responsible for the offshore oil and gas industry To ensure workplace risks are properly controlled, they develop policy and: Assist in the development of technical standards 16 Overview of UK Offshore Oil & Gas Regulation
17 Structure of HSE-ED ED1 - Inspection Management; and Well Engineering and Operations ED2 - Inspection Management and Operational Business Support ED3 - Process Integrity; Fire, Explosion and Risk Assessment; Emergency Response; Marine and Aviation; Mechanical Engineering; Electrical and Control Systems; Occupational Health; and Human and Organisational Factors ED4 - Structural Integrity; Naval Architecture and Marine Engineering; Diving; and Offshore renewables ED5 - Gas and Pipelines Strategic Interventions Incident Response 17 Overview of UK Offshore Oil & Gas Regulation
18 Main Functions of HSE-ED HSE is responsible for regulating the risks to health and safety arising from work activities in the offshore industry on the UK Continental Shelf. Post-Deepwater Horizon, Offshore Safety Directive Competent Authority established in partnership with DECC EDU-OGED, to prevent and respond to major accidents To do this, it has developed regulations relating to installations, pipelines, well operations, etc. for the offshore sector, to add to UK general health and safety law 18 Overview of UK Offshore Oil & Gas Regulation
19 Offshore Safety Directive Regulator Partnership arrangement between HSE & DECC to deliver the Competent Authority required by the OSD not a legal entity CA working: Focus of OSDR is on Major Accident prevention and mitigation CA will review Safety Cases and other notifications under SCR2015 Joint inspection & planning Joint investigation Closer working between HSE & DECC Oversight from Operational Management Team & Strategic Oversight Board Details at 19 Overview of UK Offshore Oil & Gas Regulation
20 Further Information: Offshore oil & gas - Environmental Protection
November 2016 Revision
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