Memorandum of Understanding (MOU) Between the Minerals Management Service and the United States Coast Guard

DEPARTMENT OF THE INTERIOR

Minerals Management Service

Memorandum of Understanding (MOU) Between the Minerals Management

Service and the United States Coast Guard

AGENCY: Minerals Management Service, Interior.

ACTION: Notice.

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SUMMARY: Minerals Management Service (MMS) and the United States Coast

Guard (USCG) are updating their MOU concerning responsibilities for

offshore facilities. The update is necessary to add responsibilities

associated with floating facilities, the Oil Pollution Act (OPA), and

civil penalties.

DATES: MMS and USCG will consider all comments received by March 6,

1998. We will begin reviewing comments at that time and may not fully

consider comments we receive after March 6, 1998.

ADDRESSES: Mail or hand-carry comments to the Department of Interior;

Minerals Management Service; Mail Stop 4700; 381 Elden Street; Herndon,

Virginia 20170-4817; Attention: Rules Processing Team.

FOR FURTHER INFORMATION CONTACT: Sharon Buffington, MMS at (703) 787-

1147 or LCDR Stephen Kantz, USCG at (202) 267-0505.

SUPPLEMENTARY INFORMATION: In August, 1989 the MMS and the USCG signed

an MOU that outlined responsibilities associated with facilities

located on the Outer Continental Shelf (OCS). The purpose was to

minimize duplication, and to promote consistent regulation of these

facilities. The use of floating facilities, and responsibilities

assigned by OPA created by need to update the MOU. Therefore, the MMS

and USCG are coordinating an update of the 1989 MOU to add

responsibilities for:

Floating facilities;

OPA; and

Civil penalities.

For floating facilities, we plan to use jointly approved third

party verification agents to conduct the joint reviews specified in

Table C of the MOU.

We are working to ensure that the MOU is a workable document that

we will update whenever necessary. MMS is publishing this request for

comment on behalf of both MMS and the USCG. Please send comments on the

MOU (Appendix A) to the address listed in the addresses section of this

notice.

Also, please comment on whether you believe that the MMS and USCG

should exchange other responsibilities to improve efficiency. For

example, would it be more efficient if MMS assumed the remaining USCG

responsibilities for fixed facilities? We are considering all options

to improve customer service under the guidelines of the National

Performance Review.

[[Page 257]]

Dated: December 29, 1997.

Carolita U. Kallaur,

Associate Director for Offshore Minerals Management.

Appendix A--Memorandum of Understanding between the Minerals Management

Service and the United States Coast Guard

I. Purpose

This Memorandum of Understanding (MOU) defines the

responsibilities of the Minerals Management Service (MMS) and the

United States Coast Guard (USCG). The jurisdictional area covered by

this MOU is the Outer Continental Shelf (OCS) except for oil-spill

preparedness and response functions that are seaward of the coast

line. An MOU, dated February 3, 1994, among the Departments of

Transportation and the Interior, and the Environmental Protection

Agency established jurisdictional responsibilities for facilities

located both seaward and landward of the coast line.

This MOU will minimize duplication and promote consistent

regulation of facilities in the offshore. This MOU does not apply to

deepwater ports as licensed by the Secretary of Transportation under

the Deepwater Port Act of 1974, as amended.

II. Definition

For purposes of this MOU, the following definitions apply:

Act--The OCS Lands Act (OCSLA) of 1953 (43 U.S.C. 1331 et seq.),

as amended by the OCSLA amendments of 1978 (Pub. L. 95-372).

Coast Line--The line of ordinary low water along that portion of

the coast which is in direct contact with the open sea and the line

marking the seaward limit of inland waters, as defined by the

Submerged Lands Act (43 U.S.C. 1301 (c)).

Mobile Offshore Drilling Unit (MODU)--A vessel capable of

engaging in drilling operations for exploring or exploiting subsea

resources of oil, gas, or minerals. An MODU is also classified as a

facility when engaged in drilling or downhole operations.

OCS--The submerged lands which are subject to the Act.

OSC Activity--Any activity in the OCS associated with

exploration, development, production, transporting, or processing of

OCS mineral resources including but not limited to oil and gas.

OCS Facility--Any artificial island, and installation or other

device permanently or temporarily attached to the sea bed, erected

for the purpose of exploring for, developing, or producing resources

from the OCS. This term does not include ships or vessels on the

waters above the OCS used for construction or conveyance in support

of OCS activities, or in uses of these waters unrelated to OCS

activities. The following are types of OCS facilities:

1. Fixed OCS Facility--A bottom founded OCS facility permanently

attached to the seabed or subsoil of the OCS, including platforms,

guyed towers, articulated gravity platforms, and other structures.

This definition also includes gravel and ice islands and caisson

retained islands engaged in OCS activities used for drilling,

production, or both.

2. Floating OCS Facility--A buoyant OCS facility securely and

substantially moored so that it cannot be moved without a special

effort. This term includes tension leg platforms, spars, and

permanently moored semisubmersibles or shipshape hulls but does not

include MODUs solely engaged in drilling activities.

3. OCS Terminal--Any facility or vessel located on the OCS which

is designated for use as a port or terminal for transferring OCS

mineral resources or hydrocarbons from other sources to or from a

vessel. This includes OCS facilities and their associated pipelines

licensed by the Secretary of Transportation under the Deepwater Port

Act of 1974.

OPA--The Oil Pollution Act of 1990 (Pub. L. 101-380).

Person--A natural person, an association, a State, a political

subdivision of a State, or a private, public, or municipal

corporation.

Production Facility--Any OCS facility designated by the lessee

of an OCS lease for the purpose of producing, transporting,

processing, or supporting the production of the mineral resources.

This definition also includes gravel and caisson retained islands

engaged in any OCS activities even though they may be used for

purposes other than producing, transporting, processing, or

supporting the production of OCS mineral resources.

Regional Director (RD)--The MMS officer delegated the

responsibility and authority for a region within MMS. The USCG

referrals for violations occurring in a particular MMS Region would

be made to that MMS Region's RD.

Regional Supervisor (RS)--The MMS officer (or the authorized

representative) in charge of operations with a region.

Vessel--Every description of watercraft or other artificial

contrivance used, or capable of being used, as a means of

transportation on the water. This term does not include atmospheric

or pressure vessels used for containing liquids or gases.

Violation--Failure to comply with the OCSLA, with any

regulations, or the terms or provisions of leases, licenses,

permits, or rights-of-way issued under the OCSLA.

III. Responsibilities.

The responsibilities in section III are organized as follows:

Table A lists MODUs;

Table B lists fixed facilities; and

Table C lists floating systems.

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MMS USCG

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A. MODUs:

1. Design and construction................ ........... 1

2. Structural integrity & modification &

repair requirements...................... ........... 2

3. Stability & buoyancy in transit and

operation................................ ........... 3

4. General arrangement.................... ........... 4

5. Cranes, booms, elevators, handling

equipment (includes BOP handling)........ ........... 5

6. Electrical system design and equipment

& classified area designations........... ........... 6

7. Permanently installed boilers, pressure

vessels, piping, & machinery not covered

by MMS................................... ........... 7

8. Mooring systems design, rating, &

compatibility--not site-specific......... ........... 8

9. Helicopter deck installations,

including refueling facilities and

operations............................... ........... 9

10. Pollution prevention systems (33 CFR

151-156)................................. ........... 10

11. Firefighting for systems under USCG

authority................................ ........... 11

12. Structural inspection................. ........... 12

13. Safe welding and burning procedures on

structural members....................... ........... 13

14. Transferring materials and personnel

by crane or other--on or off facility.... ........... 14

15. Well-control equipment--surface and

subsurface............................... 15 ...........

16. Safety systems required by MMS........ 16 ...........

17. Emergency shutdown systems............ 17 ...........

18. H2S equipment and control, gas

detection systems, worker protection (not

fire related)............................ 18 ...........

19. Subsea completions.................... 19 ...........

20. Gas detection systems................. 20 ...........

21. Containment systems for overflow...... 21 ...........

22. Well or production related pressure

vessels and piping....................... 22 ...........

23. Pollution prevention and equipment

(not vessel transfers)................... ........... 23

24. Administrates a shut down of a

facility................................. 24 ...........

[[Page 258]]

B. Fixed facilities:

1. Fire protection--structural (quarters,

bulkheads, decks, escape routes, testing

& material classification; fire

detection, control & extinguishing

systems; equipment & helicopter deck &

refueling facilities. Fire fighting for

structural systems not in #2 below....... ........... 1

2. Fire protection systems (deluge &

sprinkler in well bay areas, detectors,

and fire loop in wellhead production area

and quarters)............................ 2 ...........

3. Dehydration equipment and gas

compressor units used in production...... 3 ...........

4. Occupational health and workplace

safety................................... ........... 4

5. Evacuation procedures and escape routes ........... 5

6. Lifesaving systems and equipment....... ........... 6

7. Ventilation system requirements........ ........... 7

8. General alarms......................... ........... 8

9. Personnel protection equipment (not

H2S)..................................... ........... 9

10. Living quarters....................... ........... 10

11. Communications........................ ........... 11

12. Navigation & obstruction lights an

sound signals............................ ........... 12

13. Review design, fabrication, and

installation............................. 13 ...........

14. Verify site specific considerations... 14 ...........

15. Well-control equipment--surface and

subsurface............................... 15 ...........

16. Safety systems........................ 16 ...........

17. Emergency shutdown system............. 17 ...........

18. Wellhead, flowline, pipeline, & well

test equipment includes safety valves &

pressure sensors......................... 18 ...........

19. H2S equipment and control, gas

detection systems, worker protection (not

fire-related)............................ 19 ...........

20. Piping systems (production and

related) includes incoming and departing. 20 ...........

21. Pumps used to transfer liquids within

the production systems & into pipes...... 21 ...........

22. Odorant treatment of gas piped into

enclosures............................... 22 ...........

23. Subsea completions.................... 23 ...........

24. Gas-detection systems (drilling,

production, gas-transmission or

equipment)............................... 24 ...........

25. Sale and metering equipment for

production of oil, gas & sulphur......... 25 ...........

26. Containment systems for overflow from

drilling and production equipment........ 26 ...........

27. Vessels (pressure, atmospheric, &

fired) and piping-drilling and production 27 ...........

28. Well-head and platform removal........ 28 ...........

29. Drilling, workover, completion, well-

servicing (includes well-control)........ 29 ...........

30. Pollution prevention and equipment

(not vessel transfers)................... 30 ...........

31. Safe welding, burning and hot tapping. 31 ...........

32. Pipeline operations--associated with

the facility............................. 32 ...........

33. Emergency egress procedures (includes

lifesaving & emergency equipment)........ ........... 33

34. Explosive, radioactive & flammable

(not hydrocarbon) material handling,

transferring & stowage (& other HAZMATS). ........... 34

35. Petroleum and other product transfer

(to & from a vessel)..................... ........... 35

36. Vehicle and vessel operations......... ........... 36

37. Diving operations and equipment....... ........... 37

38. Administrates a shut down of a

facility................................. 38 ...........

39. Investigation lead for collisions,

deaths, injuries......................... ........... 39

40. Structural integrity, modification,

and repair requirements.................. 40 ...........

41. Electrical system design and equipment 41 ...........

42. Engine exhaust insulation and spark

arrestors................................ 42 ...........

43. Material handling equipment (including

cranes and booms)........................ 43 ...........

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C. Floating OCS Systems

Table C lists the responsibilities for floating OCS systems:

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MMS MMS/USCG USCG

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Production equipment (including Design of turret

risers & turret). hull interface &

fabrication of

turret & turret

hull interface.

Fire detection--production & System interfaces Fire Protection &

drilling areas. for non- Response For All

Fire extinguishing--well bay gas independent fire Other Areas

&/or H2S detection in all areas. detection and Fire Detection--

fire Remainder of

extinguishing Vessel/Facility.

systems.

Site specific considerations TLP tendons & ..................

(including geotechnics. mooring systems

of other floating

production

systems.

TLP foundations................. Hull structure for Hull structure-

TLP, SPAR, & shipshape FPS

hybrid. Accommodations-

all types

Structural fire

protection for

all types.

Hazardous areas &

general

arrangement.

Design Stability for all

Environmental types.

Conditions (DEC)

Station keeping--

DP vessels.

Design operating ..................

conditions.

Non-production

machinery/

electrical

systems..

Lifesaving

equipment [MODU

or tankship

requirements].

Helicopter

facilities (MODU

regulations).

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TLP--Tension leg platform. DP--Dynamically Positioned.

[[Page 259]]

IV. Civil Penalties

A. The USCG reports violations of OCSLA statutes or regulations

which may result in civil penalty action to MMS by using the

Compliance Review Form, MMS-129. The USCG will investigate and

document OCSLA based violation cases according to the procedures in

33 CFR 140.40 with the following clarification:

1. The cognizant Officer in Charge, Marine Inspection (OCMI)

provides the violator written notice of the violation and

establishes a reasonable time for the violator to correct the

violation. However, a violation that constitutes a threat of

serious, irreparable, or immediate harm does not need a time for

correction before the OCMI proceeds with a civil penalty

recommendation. For violations which do not constitute a threat of

serious, irreparable, or immediate harm, the OCMI may consult the

MMS RD to establish reasonable corrective times, particularly on

matters in which MMS has expertise or knowledge of industry

practice.

2. If the appropriate time to file an appeal has past, and the

violator has not filed an appeal with the appropriate USCG official,

pursuant to 43 USC 1248(a), the OCMI provides the MMS Regional Civil

Penalty Coordinator with the following information:

I. The case file, which consists of a summary of the

investigation and a USCG determination of the regulations violated.

ii. A description of the seriousness of violation and any

incidents actually associated with the violation.

iii. If requested, additional information concerning the merits

of a civil penalty action. All physical evidence remains with the

USCG, but available to MMS upon request.

3. If the violator files an appeal, the USCG will forward the

case to MMS after the USCG Hearing Officer issues a final decision

on the appeal.

4. Upon receipt of the violation report, the MMS Regional Civil

Penalty Coordinator will appoint a Reviewing Officer (RO) who will

process the report in accordance with the MMS OCS Criminal/Civil

Penalties Program Guidebook.

5. Notification of the MMS RO's decision regarding the civil

penalty assessment, collection, compromise, or dismissal shall be

provided to the OCMI originating the violation report.

V. Pollution responsibilities

A. Certificates of Financial Responsibility (COFR)

1. The MMS issues Certificates of Financial Responsibility

(COFR) for all facilities seaward of the coast line. The MMS COFR

ensures that lessees possess adequate oil spill financial

responsibility for the clean up and damages from oil discharges

resulting from oil exploration and production facilities and the

associated pipelines.

2. The USCG issues COFR for vessels and floating OCS facilities

which store oil. This COFR is in addition to the MMS COFR and

addresses the operators financial responsibility for the clean up

and damages from oil discharges resulting from non-well related

sources and produced oil store on board the floating OCS facility.

B. Oil Spill Preparedness and Response Planning

1. The MMS, for all facilities seaward of the coast line,

requires that responsible parties maintain approved Oil Spill

Response Plan (OSRP) consistent with the area contingency plan

(ACP); ensures that response personnel receive training; and that

response equipment is inspected. The MMS may require unannounced oil

spill response drills. The MMS RS will notify the Federal On Scene

Coordinator (FOSC) of drills to coordinate participation, and avoid

conflict or duplication.

2. The USCG Captain of the Port serves as the pre-designated

FOSC in accordance with the national Contingency Plan. The cognizant

FOCS will also jointly approve OSRPs for floating OCS facilities

which store oil. Participation in MMS drills will be at the

discretion of the FOSC. The FOSC will advise the MMS RS of spill

response drills and activities occurring offshore.

C. Spill Response

1. All spills are required to be reported to the NRC. The NRC

provides notification to the appropriate agencies and state offices.

Additionally, offshore facility owners or operators are required to

report spills over one barrel to the MMS RS.

2. The FOSC will direct and monitor federal, state, and private

actions, consult with affected trustees, and determine removal

completion. The MMS RS will direct measures to abate sources of

pollution from an offshore facility.

VI. Exchanging Services and Personnel

To the extent its own operations and resources permit, each

Agency will provide the other Agency with assistance, technical

advice, and support, including transportation, if requested.

Exchange of services and personnel is non-reimbursable (except for

pollution removal funding authorizations for incident specific fund

access). The assistance may extend to areas beyond the OCS where one

Agency's expertise will benefit the other Agency in applying and

enforcing its safety regulations.

VII. Other Cooperative Functions

A. Both agencies will exchange data and study results,

participate in research and development projects and exchange early

drafts of rulemaking notices to avoid duplicative or conflicting

requirements.

B. Both Agencies will review current standards, regulations, and

directives and will propose revisions to them necessary in keeping

with the provision of this MOU.

C. Both Agencies will review reporting and data collection

requirements imposed on operators of OCS facilities and, where

feasible, eliminate or minimize duplicate reporting and data

collection requirements.

VIII. Implementing this MOU

A. Each Agency will review its internal procedures, and where

appropriate, will revise them to accommodate the provisions of this

MOU. Each Agency will also designate in writing one senior official

who will be responsible for coordinating and implementing the

provisions of this MOU.

B. Each agency will designate regional officials to be

responsible for coordinating and implementing the provisions of this

MOU in their respective regions.

C. The USCG--MMS MOU concerning regulation of activities and

facilities in the OSC, dated August 29, 1990, is canceled on the

effective date of this agreement.

D. The MOU between the Department of the Interior and the

Department of Transportation regarding responsibilities under the

National Oil and Hazardous Substances Pollution Contingency Plan,

dated August 16, 1971, is canceled on the effective date of this

agreement.

E. If new technology (or new uses of current technology) require

a change to this MOU, the MMS regional office and appropriate USCG

district will work together to solve the situation. The MMS regional

office and the USCG district will notify their respective

headquarters office of the change. If the MMS regional office and

the USCG district office can't solve the situation, it will be

elevated to MMS and USCG headquarters. The new policy will become

part of a revised MOU the next time the MOU is revised.

IX. Savings Provision

Nothing in this MOU alters, amends, or affects in any way the

statutory authority of MMS or the USCG.

X. Effective Date

This MOS is effective upon signature. Both parties may amend it

by mutual agreement and either agency may terminate it with a 30-day

written notice.

Signed at Washington, D.C. this

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Commandant, U.S. Coast Guard, Department of Transportation.

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Director, Minerals Management Service, Department of the Interior.

[FR Doc. 98-9 Filed 1-2-98; 8:45 am]

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