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BSEE Proposes Amending Offshore Drilling Safety Rules

The Trump administration is proposing to amend offshore drilling safety rules promulgated during the Obama era, saying that the changes could save the oil and natural gas industry at least $228 million over the next decade.

On Thursday, the Interior Department's Bureau of Safety and Environmental Enforcement (BSEE) said it had completed a comprehensive review of its production safety systems regulations, and came up with a proposed rule to change several areas of existing law. The proposed rule was published Friday in the Federal Register, and the BSEE will accept public comments through Jan. 29.

"By reducing the regulatory burden on industry, we are encouraging increased domestic oil and gas production while maintaining a high bar for safety and environmental sustainability," said BSEE Director Scott Angelle, who was appointed by President Trump last May.

The proposed rule would amend federal regulations -- specifically, Title 30, Part 250, Subpart H, which covers oil and gas production safety systems. The rulemaking proposes to, among other things:

  • add gas lift shut down valves to the list of safety and pollution prevention equipment (SPPE);
  • revise requirements for SPPE to clarify the existing regulations; and
  • remove the requirement for operators to certify through an independent third party that each device is designed to function in the most extreme conditions to which it will be exposed and that the device will function as designed.

The government also wants to clarify failure reporting requirements, and to clarify and revise some production safety system design requirements, including requirements for piping schematics and electrical system information. Also up for clarification are when operators must provide certain documents to the BSEE, and when operators must update existing documents.

The Subpart H rules were first promulgated in September 2016, and most of them took effect two months later. BSEE said that since the rules took effect, it had "become aware that certain provisions in that rulemaking created potentially unduly burdensome requirements to oil and natural gas production operators on the Outer Continental Shelf [OCS], without significantly increasing safety of the workers or protection of the environment."

BSEE proposed the rulemaking in response to a pair of executive orders (EO) issued by Trump in 2017. The first EO, issued in March, ordered federal agencies to review their existing regulations, and to either suspend, revise or rescind any that are deemed a hindrance to domestic energy development. Meanwhile, a second EO issued in April ordered the BSEE to review its proposed Well Control Rule, which the bureau developed in response to BP plc's Macondo well blowout in 2010 in the deepwater Gulf of Mexico.

The BSEE was formed in 2011 following a revamp of the former Minerals Management Services, which initially created its twin agency, the Bureau of Ocean Energy Management. BSEE's formation followed a review of Macondo, which was found to have resulted in part from safety lapses. The BSEE is tasked with ensuring safe and responsible energy development on the OCS and making sure the federal government receives fair royalties on offshore production.

"It's time for a paradigm shift in the way we regulate the OCS," Angelle said. "There was an assumption made previously that only more rules would increase safety, but ultimately it is not an either/or proposition. We can actually increase domestic energy production and increase safety and environmental protection."

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