Offshore Energy: 10 Key Ways Operations Have Been Strengthened

Erik Milito
Posted April 17, 2019

With the Trump administration nearing release of a new five-year offshore leasing plan for oil and natural gas, offshore energy has never been safer or stronger – thanks to initiatives and technologies designed to enhance worker safety and protect the environment. (See this post dispelling offshore energy myths.) Below, 10 important developments that have strengthened the vitally important work of harnessing America’s offshore energy.

1. Center for Offshore Safety

The Center for Offshore Safety (COS) is an industry-led initiative to promote continuous safety improvement for offshore drilling, completions and operations through effective leadership, communication, teamwork, disciplined management systems and independent third-party auditing and certification. 

A key COS focus is implementing Safety and Environmental Management Systems (SEMS) by the offshore industry, which is discussed below in the next section. In addition, among others, the COS has developed the following robust guidelines for promoting safety in offshore operations:

• COS-3-04 Guidelines for a Robust Safety Culture First Edition
• Guideline for Skills and Knowledge Management System for the U.S. Offshore Oil & Gas Industry
• Guidelines for Leadership Site Engagement

The COS also collects, analyzes, and shares safety performance data so that the industry can continuously improve operations by sharing data and learning from incidents. 

2. Safety and Environmental Management Systems

This is a robust, systems-based approach to safety, described in API Recommended Practice 75, which was incorporated into federal regulations by the Bureau of Safety and Environmental Enforcement (BSEE). RP 75 outlines the various key elements for inclusion in an effective SEMS program. These include a thorough completions of hazards analysis to help ensure that risks are identified, prevented and mitigated; and management of change procedures so that operators can make sure that no new risks are being introduced into operations before changes in operations occur. 

The COS has also created a process for accredited, independent third-parties to provide audits of individual company SEMS, which is critically important to comply with BSEE regulations.

3. Capping and Containment Companies and Standby Equipment

Well intervention and containment consortiums founded in 2010 provide containment technology and response capabilities for the unique challenges should an incident occur thousands of feet below the water’s surface. The Marine Well Containment Company (MWCC) and the HWCG, LLC, can quickly deploy systems designed to stem any uncontrolled flow of hydrocarbons from a subsea well and facilitate the training of their member companies on the installation and operation of these systems. Companies are required to show access to this equipment and staff resources to deploy systems to cap a well or capture uncontrolled hydrocarbons.

4. New and Revised Industry Equipment and Safety Standards

The industry has published more than 100 new and revised exploration and production standards over the past 10 years. For drilling and production, a key to the overall system of safety is the barrier philosophy, where multiple layers of protection are put into place to effectively ensure that oil and natural gas are contained. 

For example, there’s Standard 65-2, which contains best practices for zone isolation in wells to prevent annular pressure or flow, past containment barriers that are installed and verified during well construction. This document has been incorporated by reference into BSEE’s offshore regulations. Another is Standard 53, which provides the requirements on the installation, maintenance, testing and inspection of blowout prevention equipment. 

5. Federal Drilling Safety Rule

BSEE’s drilling safety rule contains extensive requirements for well design and integrity, and blowout preventer and control systems. Among other things, BSEE requires: (1) identification of the mechanical barriers and cementing practices that will be used; (2) independent third-party verification that the blowout prevention equipment is designed for the specific equipment on the rig and for the specific well design; (3) independent third-party verification that the blowout prevention equipment will operate in the conditions in which it will be used; (4) a certification signed by a registered professional engineer that the casing and cementing design is appropriate for the purpose for which it is intended under the expected conditions; and (5) for wells that use subsea blowout prevention equipment, the inclusion of two independent barriers, including one mechanical barrier, for each annular flow path. There are also extensive requirements for the maintenance, testing and inspection of blowout prevention equipment.

6. Worst-Case Discharge Policies and Heightened Industry Response Capacity

BSEE has new requirements for determining the worst case blowout discharge and the associated demonstration of capability to effectively respond to such a discharge. Industry has improved its spill response planning and monitoring, and the increased availability of spill response tools such as dispersants, in-situ burning capabilities, mechanical recovery, and shoreline protection. 

7. Enhanced Federal Inspection and Enforcement

In 2017, BSEE personnel conducted 17,661 inspections throughout the Gulf of Mexico on production facilities and drilling rigs. Oil production from the U.S. Outer Continental Shelf totaled more than 620 million barrels that year, and 99 percent of this production came from the Gulf. U.S. oil and natural gas companies pay inspection fees to cover the cost of this program.

Last year, BSEE announced a new inspection program that systematically identifies facilities and operations that have a high-risk profile. The approach aligns with a 2012 GAO report advising BSEE to identify and evaluate offshore operations according to risk, inspections that supplement BSEE’s existing National Safety Inspection Program. It looks beyond compliance and assesses the integrity of critical safety systems on facilities and operations, including those that have had multiple incidents of non-compliance or events and may need more attention. Earlier this year, BSEE conducted risk-based inspections of 40 facilities over a two-day period, based on real-time data focused on improving safety.

Also last year, BSEE started significantly increasing the time that its inspectors spend on offshore oil and natural gas facilities. Using better technology to access electronic records maintained onshore, the agency can now be more efficient in its offshore inspections while reducing helicopter operating expenses 15 percent.

8. API’s Q2 Certification for Service Supply Contractors

Specification Q2 is the first-ever quality management system certification for industry service supply organizations. It’s similar to Spec Q1, which certifies oil and natural gas equipment manufacturers for the safety, consistency and interchangeability of their products. Spec Q2 was designed to reduce risk and improve service quality by identifying and standardizing the expectations for execution of upstream services like well construction, intervention, production and abandonment. The standard is recognized around the world as a key tool for advancing contractor performance.

9. Improved U.S. Coast Guard Regulations, Inspections and Training

The Coast Guard has been very active in revising its regulatory policies over the past several years and has made significant enhancements including, among others:

• Regulations for third-party testing and certification of electrical equipment in hazardous locations on newly constructing MODUs, floating offshore facilities, and vessels other than offshore supply vessels that engage in offshore activities
• Revised crane regulations
• Guidelines for fire and explosion analyses
• Guidelines for lifesaving and fire-fighting equipment, training and drills onboard manned offshore facilities
• Updated inspection protocols for vessels in offshore operations
• Improved collaboration with the Bureau of Safety and Environmental Enforcement on regulatory oversight, inspection and oversight, and spill response

10. Continuous Innovation and Advancement in Technology

Innovation and advancement of technology underpin all aspects of the oil and natural gas industry, and continued improvements have enabled safer operations, as well as the economic unlocking of resources. Continual improvement is enabled through application of new technologies, both equipment and methods, across the full life cycle of offshore oil and natural gas projects – from pre-drill planning to completion, production and post-production plugging.

Innovation cascades across the offshore industry and is evident in advancements in everything from information management systems and large data analytics to well planning and design, manufacture of heavy iron drilling rigs and tubulars, complex downhole completion equipment and tools, and new methods and techniques. 

As a result of the constant advancement of technologies across all project components, U.S. ingenuity and engineering prowess has elevated safety and systems integrity to the highest levels in offshore oil and natural gas operations and across the broad spectrum of industrial engineering applications.