Safety and Environmental Management Program (SEMP) on the Outer Continental Shelf (OCS)

DEPARTMENT OF THE INTERIOR

Minerals Management Service

Safety and Environmental Management Program (SEMP) on the Outer

Continental Shelf (OCS)

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Notice.

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SUMMARY: The MMS has postponed its decision regarding the mandatory or

voluntary adoption of the SEMP by OCS lessees. The MMS does not have

sufficient information to determine whether the voluntary adoption of

SEMP currently achieves the regulatory goals of the MMS. We will

continue assessing the oil and gas industry's progress in implementing

SEMP and will make a determination on this program in mid-1997.

DATES: Comments may be submitted at any time.

ADDRESSES: We welcome your comments on MMS' SEMP concept, the American

Petroleum Institute's Recommended Practice 75, OCS safety and

environmental protection issues in general, implementation strategies,

and related matters. Send comments to Henry Bartholomew; Deputy

Associate Director for Operations and Safety Management; Minerals

Management Service; Mail Stop 4600; 381 Elden Street; Herndon, Virginia

22070-4817.

FOR FURTHER INFORMATION CONTACT:

Jeff Wiese, SEMP Manager; Mail Stop 4800; Minerals Management Service;

381 Elden Street; Herndon, Virginia 22070-4817, telephone (703) 787-

1591.

SUPPLEMENTARY INFORMATION:

What Is SEMP?

The SEMP is a safety systems management model designed around

offshore oil and gas exploration and development activities. This

concept is currently embodied in a publication of the American

Petroleum Institute (API) known as Recommended Practice 75 (RP75). This

document is available from the API: they can be reached by phone at

(202) 682-8375.

How Did We Get to This Point?

The MMS introduced its SEMP concept in the Federal Register on July

2, 1991 (56 FR 30400). In response, OCS operators requested that they

be given an opportunity to further develop SEMP and a chance to

demonstrate that they could voluntarily adopt it. The MMS joined with a

broad-based industry committee to refine the SEMP concept under the

aegis of the API. In May 1993, the API published RP75 as its response

to SEMP. On June 30, 1994, the MMS published a notice in the Federal

Register (59 FR 33779) in which it said that RP75 generally captured

the agency's perception of what a SEMP should contain. At that time,

the MMS committed to a 2-year moratorium on regulatory activity related

to SEMP during which time it would closely monitor the voluntary

adoption of RP75 by OCS operators. The observation period officially

expires this summer.

Why Is the MMS Promoting SEMP?

The MMS and its predecessors have developed a sound regulatory

program to protect the public's interests in the exploration and

development of OCS oil and gas over the course of more than a quarter

century. This program is based, in large measure, on standards and

recommended practices developed in association with OCS stakeholders

that delimit how a ``safe and prudent'' operator would conduct its

business. This regulatory program has historically focused on hardware

and engineering solutions. It has been, as well, fairly prescriptive.

The SEMP concept was created to address the role of human and

organizational error to accidents. By some estimates, human and

organizational factors lie at the root cause of up to eighty percent of

all accidents.

Through SEMP, the MMS is seeking alternative ways to enhance

current efforts to protect people and the environment during oil and

gas exploration and production activities taking place on the U.S. OCS.

The MMS undertook this initiative following two separate, but related,

studies which indicated that OCS operators were led by the traditional,

prescriptive regulatory approach of the MMS to focus more on compliance

with existing rules than in systematically identifying and mitigating

all risks posed by their operations. Implementation of SEMP squarely

places the responsibility for protection of people, facilities, and the

environment on the shoulders of OCS operators.

How Well Is SEMP Being Implemented?

To gauge how well OCS operators were implementing SEMP, as well as

to identify areas in which the agency could assist them in this

endeavor, the MMS joined with the API, the Independent Petroleum

Association of America, the Offshore Operator's Committee, and the

National Ocean Industries Association to conduct an annual series of

surveys. The baseline implementation survey was conducted in January

1995 and a follow-up survey was performed in January 1996. About 95

percent of all OCS operators representing over 99 percent of total OCS

oil and gas production (over 3.5 million barrels of oil equivalent per

day) responded to this last survey.

Collectively, these surveys have shown that OCS operators--as a

whole--are well on their way to implementing SEMP plans that they have

been developing during the past 2 years. If progress similar to this is

maintained, the MMS expects that many of these companies' SEMP plans

will be fully implemented in the field within the next 1-2 years.

[[Page 37494]]

Has the MMS Fully Evaluated the Voluntary Adoption Approach?

No. Because the MMS strongly believes that the real value of SEMP

will be derived from field-level implementation of SEMP plans, we

believe it will be another year before we have enough evidence to

ascertain whether this regulatory approach will be a success. We have

every reason to believe it will be if OCS operators continue to develop

and implement their SEMP plans with due diligence.

What's Next?

The MMS will defer judgment on how successful voluntary adoption of

RP75 has been for 1 year. We have, however, identified a few goals that

we can pursue collectively with OCS operators during this time:

1. Work to broaden voluntary implementation to the few remaining

holdouts;

2. Accelerate, where feasible, field-level implementation of SEMP

plans;

3. Continue to promote greater understanding of SEMP through

cooperative efforts such as the joint workshops held during 1995;

4. Begin to develop reliable, commonly-defined measures of

performance; and,

5. Further explore regulatory reform for companies that

conscientiously develop, implement, and undertake to improve SEMP

plans.

Also during this time, the MMS will continue its efforts to

independently assess implementation of SEMP by meeting with OCS

operators on a voluntary basis to discuss their SEMP plans and by

talking to field-level personnel during routine inspections we conduct

of their offshore facilities.

(Authority: U.S.C. 1334)

Dated: June 26, 1996.

Carolita U. Kallaur,

Acting Director, Minerals Management Service.

[FR Doc. 96-18267 Filed 7-17-96; 8:45 am]

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