Feds add teeth to offshore drilling safety mandates

Federal regulators on Thursday finalized a plan designed to boost the safety of offshore drilling by insisting that workers have the power to halt dangerous activity and requiring third-party audits of risk management programs.

The so-called SEMS II rule effectively bolsters a 2011 requirement that companies working offshore implement broad “safety and environmental management systems” for holistically assessing and managing risks at every stage of their work.

The measure, finalized by the Bureau of Safety and Environmental Enforcement, also requires companies to establish procedures authorizing all employees at their facilities to stop work whenever they see risky or dangerous activity. Many oil companies and offshore service firms already have voluntarily implemented such stop-work policies, but the new rule makes that a requirement with the full force of the federal government.

With the new rule, regulators also are requiring offshore drilling operators to beef up their existing safety and environmental management systems to include job safety analyses and new employee participation plans, so workers can be involved in limiting hazards.

James Watson, the director of the safety bureau, cast the new mandate as taking “another important step toward protecting workers and the environment from preventable accidents” by encouraging “a robust positive safety culture” offshore.

“BSEE’s workplace safety rules are designed to promote that culture by eliminating complacency and making sure that companies are looking at the human factors that underlie too many accidents,” Watson said.

Federal regulators are giving companies a little over a year to comply; the final deadline for implementing the changes is June 4, 2014.

The initial SEMS mandate, finalized in the wake of the Deepwater Horizon disaster (though proposed years earlier) was meant to shift the United States into the path of the United Kingdom, Norway and other countries that are blending some proscriptive regulations with a performance-based approach to offshore oversight that puts the onus on companies to holistically assess and manage risk.

After the 2010 Gulf oil spill, at least two government panels suggested the U.S. should adopt a performance-based system. And the Chemical Safety Board, which is set to issue its report on the Deepwater Horizon disaster this year, is exploring whether the government needs to do even more to move toward a risk-based model.