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Codifying the Arctic safety rules BSEE and BOEM directors reflect on their visit to northern Alaska and the new drilling regulations that their agencies propose Alan Bailey Petroleum News
During the second week of March Brian Salerno, director of the Bureau of Safety and Environmental Enforcement, and Abigail Ross Hopper, director of the Bureau of Ocean Energy Management, visited communities in Arctic Alaska to solicit comments on proposed new regulations for exploratory drilling in federal waters of the Beaufort and Chukchi seas. On March 13, on their return through Anchorage, the two agency officials talked to reporters about what they had heard on the North Slope and about the new regulations that their agencies have formulated.
“We are very interested in the feedback from the North Slope communities as well as other stakeholders,” Salerno said. “Overall, nobody’s told us we did a bad job.”
A variety of views While offshore development could perhaps provide an economic lifeline in an era of declining Alaska oil production, Native communities on the North Slope have expressed concern about offshore oil activities because of the possible impact of an oil spill on subsistence hunting. And most environmental organizations remain adamantly opposed to Arctic offshore oil drilling, claiming that there is no effective means of dealing with an offshore oil spill in ice-laden water.
Hopper said that during her and Salerno’s visit to the North Slope they had heard a diversity of opinion on whether the protection of the environment and of subsistence hunting can be achieved through careful and thoughtful oil and gas development, or whether through a complete prohibition of oil and gas activities.
“I think we’ve got good feedback and will continue to get good feedback on whether we have adequately addressed some of the concerns of the Native communities, whether we’ve adequately addressed some of the practicalities from the industry, whether the environmental community thinks we have hit that nail and covered those bases as well,” Hopper said.
Those people who view careful development as the appropriate route forward commented on the need for much communication, for consideration of the appropriate times to conduct activities, for consideration of weather conditions, and for agreements on where activities can take place at certain times, she said.
Specific to the Arctic
The proposed new regulations, the development of which comes as part of the outfall from the Deepwater Horizon disaster in the Gulf of Mexico, place specific requirements on drilling operations in the Arctic offshore. Those requirements include the availability in region of well capping and oil containment systems for dealing with an out-of-control well, and the availability of a second drilling rig for the drilling of a relief well. The proposed regulations also prohibit drilling into hydrocarbon zones within a certain number of days of the end of the summer open-water season, to enable a relief well to be drilled in open water conditions, should a relief well be needed. A relief well is a secondary well used to plug an out-of-control oil well by injecting cement into the well bore.
Salerno said that the regulations codify rules that were built into the permits that Shell operated under during its drilling season in the Chukchi and Beaufort seas in 2012, but with the addition of regulations derived from lessons learned from that drilling season.
“In many ways it takes that standard of care and makes it a standard for everyone,” Salerno said.
And, although there are existing drilling regulations that apply anywhere on the U.S. outer continental shelf, the new Arctic-specific regulations recognize challenges that are specific to operating in the Arctic offshore, he said.
“In the Gulf of Mexico if you need something you can call back to the beach and get it. You can’t do that in Alaska,” Salerno said.
One difference between the proposed regulations and the permit-related rules under which Shell was operating in 2012 is the mandated need for an Arctic operator to submit an integrated operations plan for its proposed offshore drilling program at least 90 days prior to filing an exploration plan. This requirement reflects the fact that problems arose during the transit and demobilization activities associated with Shell’s 2012 operations - the preparation of an operations plan will ensure that an operator has thought through all aspects of its drilling program while also giving the regulators time to provide feedback on possible issues arising from the plan, Hopper said.
And, in terms of oil spill risks, the plan emphasizes the need for in-region resources for dealing with an oil spill while also emphasizing requirements designed to prevent an oil spill happening, Salerno said. In fact, the highest cost items in the regulations - items such as well capping stacks - specifically address the oil spill issue, he said. And the agencies are insisting on mandated relief well drilling capabilities, despite some push back from industry on the cost and value of this type of contingency arrangement.
“Obviously, that is a point of conversation with industry, but it goes to that underlying theme that we will not tolerate a situation in which there’s an uncontrolled oil spill,” Salerno said.
Salerno said that the rules establish a level of care expected from an offshore operator. Although the regulations tend to spell out specific technologies capable of meeting that standard, the agencies are open to ideas for alternative technologies.
“By establishing those types of capability, that is where we set the bar,” Salerno said. “And so, if you can exceed that bar, come and talk to us.”
Comments on the proposed regulations are required by April 27.
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