Groups representing North Sea oil and gas producers have stiffened their resistance to European offshore safety regulation. The European Commission last October proposed a law centralizing oversight of work off the coasts of European Union members. Industry groups think the move would undermine its own aims.
Before meetings in Brussels Jan. 31, Oil & Gas UK and a coalition of Norwegian unions and industry associations issued statements of concern. Both statements assert that the EU proposal reflects poor understanding of offshore operations. And both flatly warn that the initiative would degrade safety. The UK group adds, "The UK government is of the same position and has signaled its intention to oppose the regulations in the best interests of safety."
Bureaucratic backlog
An analysis by Oil & Gas UK predicts a bureaucratic backlog as the safety cases UK operators now submit to authorities give way to a proposed major hazard report. "Rewriting safety cases to add in the level of detail being required by the EC would divert important resource from frontline safety," it says. During "several years" of transition, it adds, UK inspectors would have to spend their time administering the newly required assessments instead of inspecting equipment and procedures.
The UK group calls the proposed regulation "poorly drafted" and likely to create confusion, a problem it says would be aggravated by an absence of accompanying guidance for compliance. "The regulation," it adds, "fails to fully recognize the importance of involving the workforce in safety, in particular the role of safety representatives." Oil & Gas UK also cites faulty assumptions by the EC that all wells are exploratory and capable of flowing oil and gas at the high rates of the Macondo blowout in 2010, to which the EC initiative responds. And it challenges EC projections about costs and benefits.
The coalition from Norway, which isn't an EU member but would be subject to the regulation, says the EC proposal "demonstrates inadequate awareness of the complex challenges the offshore petroleum industry faces." Implementation of the draft regulation, it says, would require "a major and unnecessary overhaul of a well-functioning and interlinked Norwegian regulatory regime."
Like Oil & Gas UK, the Norwegian group regrets the EC's inclination to shrink workers' involvement in safety, which it says would be confined to preparation of Major Hazard Reports. It says the proposal would create "unclear distribution of responsibility both for safety in general, for emergency planning, and for clean-up operations." And the Norwegian group, too, questions the EC's understanding of the operating environment it proposes to regulate. "There appears to be little appreciation by the commission for the huge geological, environments, and operational differences between Europe and the Gulf of Mexico," it says.
Underlying these and other criticisms by the industry groups is a fundamental conflict. Both groups praise the safety regimes of their respective countries, which were strengthened after the Macondo disaster, for being flexible and well adapted to conditions. The EC seems to think differences between those regimes represent systematic weakness. The centralization toward which it wants to move indicates unwarranted confidence that regulations in the North Sea might apply just as well in the Mediterranean, where several EU states have begun oil and gas licensing.
Hurting safety
That approach is worse than wrong. It's unsafe. Standardization and centralization are convenient for bureaucrats. But they can only hurt safety regulation of operations as operations as complex as exploration and production in physical realms as varied as those encountered offshore.
The EC doesn't understand the challenge it has assigned itself. Its draft regulation reflects too little expertise. Oil & Gas UK suggests the EC work through a "properly worded" directive, instead of regulation, to spread North Sea safety standards across Europe without so much bureaucracy. That approach still amounts to centralization, the need for which remains questionable. But at least it might not begin, like the EC's current proposal would, by moving backward on safety.
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