Final Well Control Rule Eases Industry Concerns

deepwater horizon

By MarEx 2016-04-15 10:48:33

The U.S. has announced the final version of its controversial well control regulations designed to reduce the risk of an offshore oil or gas blowout.

The regulations build upon findings and recommendations from several investigations and reports concerning the root causes of Deepwater Horizon and extensive consultation with industry groups, equipment manufacturers, federal agencies, academia and environmental organizations.

The final rule is a comprehensive regulation addressing all dimensions of well control, including more stringent design requirements and operational procedures for critical well control equipment used in oil and gas operations on the U.S. Outer Continental Shelf.

Specifically, the final rule addresses the full range of systems and equipment related to well control operations, with a focus on blowout preventer requirements, well design, well control casing, cementing, real-time monitoring and subsea containment. The measures are designed to improve equipment reliability, especially for blowout preventers and blowout prevention technologies. The rule requires operability of equipment through rigorous testing and provides for the continuous oversight of operations, all with the goal of improving the reliability of equipment and systems to protect workers’ lives and the environment from the potentially devastating effects of blowouts and offshore oil spills.

The regulations combine prescriptive and performance-based measures to ensure that oil and gas companies and offshore rig operators are cultivating a greater culture of safety that minimizes risk. Key features of the rule include requirements for blowout preventer systems, double shear rams, third party reviews of equipment, real-time monitoring data, safe drilling margins, centralizers, inspection intervals, and other reforms related to well design and control, casing, cementing, and subsea containment.

“We listened extensively to industry and other stakeholders and heard their concerns loud and clear -- about drilling margins, blowout preventer inspections, accumulator capacity, and real-time monitoring,” said Assistant Secretary for Land and Minerals Management Janice Schneider. 

The new rule is in harmony with industry’s best practices, standards and equipment specifications, says the Bureau of Safety and Environmental Enforcement (BSEE) in a statement. For example, new drilling rigs already are being built pursuant to updated industry standards that BSEE used as a foundation for the rule. Furthermore, most rigs comply with recognized engineering practices and original equipment manufacturers requirements related to repair and training. For companies that may need time to bring their operations into compliance, most of the requirements do not become effective until three months after publication of the final rule. Moreover, several requirements have more extended timeframes for compliance.

Industry Welcomes Changes

Industry body API said it is reviewing the final version and welcomes the government’s alignment with the industry’s leadership on safety. API cautioned that elements of the initial proposal were found to have technical problems and, if left unchanged, could make offshore operations less safe.

Included among the list of concerns filed in last year’s comments was the recommendation by the government to shift operational decision making from rig site personnel to offsite personnel. The industry believes that onsite personnel have the best understanding and most complete picture of the current operation, key risks, and critical considerations.

Industry body NOIA’s President Randall Luthi also welcomed the new version. “The good news for industry today is that we are now learning what is actually in the final well control rule. We are gratified that some industry concerns were addressed. When regulations require retrofitting existing equipment or the use of new technology, it is best to have a reasonable implementation time. This was important to industry, and on that aspect BSEE agreed and extended many of the proposed timelines. 

“However, the final language on the prescriptive drilling margin may not completely address valid concerns expressed by some of our members. Therefore, the implementation scheme of that section will be key as regulators move forward under the rule. There may very well be more earwigs tucked away in the corn, but we are just now beginning to peel back the layers of this massive rule.

“In the end, nothing is more important to the oil and gas industry than safety; and cooperation and collaboration with federal regulators from planning to execution is still the best and safest policy. Industry has put sweeping new safety standards in place over the last six years, and we welcome effective regulations that support and enhance our efforts to safely and cleanly deliver the energy America needs.”

The rule is available here.