European Commission's Announcement on Offshore Safety Directive
In the aftermath of the "Deepwater Horizon" accident in the US Gulf of Mexico in May 2010 the Commission reviewed the existing Member States' safety frameworks for offshore operations and proposed new legislation to guarantee that world's highest safety, health and environmental standards apply everywhere in the EU.
The European Parliament and the Council have reached a political agreement on the Commission's legislative proposal on the safety of oil and gas operations in the EU. The European Parliament and Council are expected to formally approve the legislation in the coming months. The main elements of the agreed directive are the following:
- Licensing. The Directive introduces clear rules for effective prevention and response of a major accident. The licensing authority in the Member States will have to make sure that only operators with proven technical and financial capacities necessary to ensure the safety of offshore activities and environmental protection are allowed to explore for, and produce oil and gas in EU waters. Public participation is foreseen prior to the start of exploratory drilling campaigns in previously undrilled areas.
- Independent national competent authorities responsible for the safety of installations will verify the provisions for safety, environmental protection and emergency preparedness of rigs and platforms and the operations conducted on them. If companies do not respect the minimum standards, Member States will take enforcement actions and/or impose penalties; ultimately, operators will have to stop the drilling or production operations.
- Obligatory ex ante emergency planning. Companies will have to prepare a report on major hazards for their installation, containing an individual risk assessment and risk control measures and an emergency response plan before exploration or production begins. These plans will need to be submitted to national authorities who will give a go-ahead.
- Independent verifiers. Technical solutions presented by the operator need to be verified by an independent verifier prior to and periodically after the installation is taken into operation.
- Transparency. Comparable information will be made available to citizens about the standards of performance of the industry and the activities of the national competent authorities. This will be published on their websites. The confidentiality of whistle-blowers will be protected. Operators registered in Member States will be requested to submit reports of major accidents in which they have been involved overseas to enable key safety lessons to be studied.
- Emergency Response. Companies will prepare emergency response plans based on their rig or platform risk assessments and keep resources at hand to be able to put them into operation when necessary. Member States will likewise take full account of these plans when they compile national emergency plans. The plans will be periodically tested by the industry and national authorities.
- Liabilities. Oil and gas companies will be fully liable for environmental damages caused to the protected marine species and natural habitats. For damage to waters, the geographical zone will be extended to cover all EU marine waters including the exclusive economic zone (about 370 km from the coast) and the continental shelf where the coastal Member State exercises jurisdiction. For water damage, the present EU legal framework for environmental liability is restricted to territorial waters (about 22 km offshore).
- EU Offshore Authorities Group. Offshore inspectors of Member States will work together to ensure effective sharing of best practices and contribute to developing and improving safety standards.
- International. The Commission will work with its international partners to promote the implementation of the highest safety standards across the world. Operators working in the EU will be expected to demonstrate they apply the same policies for preventing major accidents overseas as they apply in their EU operations.