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European oil and gas proposals a threat to safety, industry warns

Out-Law News | 25 Apr 2012 | 5:28 pm | 2 min. read

New proposals designed to regulate the safety of offshore oil and gas operations at a European level risk undermining the UK's existing high standards, the industry has warned.

In a joint statement (2-page / 117KB PDF), industry body Oil and Gas UK and the two leading trade unions representing workers in the sector criticised a proposed EU Regulation on "safety of offshore oil and gas prospection, exploration and production activities", which was published in October. The new law will have a "serious detrimental impact on standards of safety and environmental protection on the UK continental shelf", they said.

"The safety of the workforce is the UK oil and gas industry's top priority," said Malcolm Webb, chief executive of Oil and Gas UK. "We fear that far from adding any tangible benefit to the UK's world class system, moving overall responsibility for offshore safety to the EU, which has absolutely no experience or competence in the area, would undermine our high standards of offshore safety and environmental protection."

If approved, the Regulation would be directly applicable to all 27 EU member states. This will mean that significant parts of the existing UK regulatory regime would have to be re-written or revoked, the joint statement said. The bodies added that almost 300 UK projects which had already been approved by the Health and Safety Executive (HSE) would need to be re-drafted, re-written and re-accepted. "[This] would divert substantial industry and regulatory resources away from tackling front line safety challenges and into desk-bound paperwork compliance," they said.

The European Commission should instead draft a "properly worded EU Directive", which would allow "other safety regimes to bring them up to North West European standards" by transposing the improvements into national law, Webb said. "If that route was adopted, the UK oil and has industry would be happy to work closely with the Commission to help disseminate North Sea experience and good practice," he added.

Almost half of the nearly 1,000 offshore oil and gas installations in operation in the EU are in UK-controlled waters, according to European Commission figures. There are 181 installations in the Netherlands, 123 in Italy and 61 in Denmark, while nine other states have either a minimal offshore oil drilling presence or have been awarded licenses to do so.

The Commission has previously acknowledged that the EU's four main producers operate under "safety regimes that are global exemplars", said Webb. "To propose that legislative competence should shift from these countries to the 27 EU member states, the vast majority of whom have no involvement in the industry at all, is totally unjustified."

The statement also pointed out that the Commission's proposals had not been developed in collaboration with the industry and its workforce in the same way as the UK's current regime. Jake Molloy, regional organiser at trade union RMT said that workforce involvement was a "fundamental part of improving all-round safety performance" in the industry.

"This is increasingly being recognised by operators and contractors," he said. "Significant improvements in this vital area have been made with a great deal more still to come, but all the good work underway could be jeopardised with the application of the EU Regulation."

There has been a 66% reduction in all types of injury and a 45% reduction in fatal and major injuries on oil and gas facilities operating on the UK continental shelf over the past 15 years, according to industry figures.

The Commission has said that its proposals will ensure that the highest safety standards applicable in some countries would become mandatory across the EU, and that the oil and gas companies will be made fully responsible for any environmental damage as a result of their operation. If approved by the European Parliament, the new law could take effect later this year with a transitional period of a maximum of two years applying to existing and planned installations.