Environmental Regulations in UNITED KINGDOM Offshore Oil and Gas Industry

This profile has been produced with the assistance of Kevin O'Carroll of the Oil and Gs Office, Department of Trade and Industry, UK.

National Profile

Summary of United Kingdom offshore regulatory measures

• The Department of Trade and Industry is the lead regulator and seeks advice from other Government departments as appropriate;

• The regulatory picture in the UK is based on legislation supported by an active industry association promoting the use of best practice with its members through guidelines and industry codes.

• Where legislation does not exist, the DTI and offshore industry have developed negotiated voluntary measures;
  

• Industry measures exist in the form of voluntary codes and guidelines, environmental protection programmes, co-ordinated networks and consultative committees;

• International agreements apply;

• No economic incentives are in place.

The DTI and operators enter into negotiations on a case by case basis and have created co-regulatory approach to offshore operations. Operators must prepare a statement of their environmental policy together with an assessment of the environment, with mitigating measures to avoid or minimise the risk to the environment, when applying for offshore petroleum licenses.

Contact Information:

Kevin O'Carroll, Oil and Gas Office
Offshore Environment Unit, Department of Trade and Industry, Oil and Gas Office, Atholl House, 86-88 Guild Street, Aberdeen, AB11 6AR Phone 01 224 254 025 Fax 01224 254 019

Email: kevin.o'carroll@dti.gsi.gov.uk

Mr. Gordon Harvey, UK Offshore Operators Association (UKOOA)
9 Albyn Terrace, Aberdeen AB10 1YP, UK
Phone 01224 626652 Fax 01224 626503 Email: gharvey@ukooa.co.uk

Mr. John Campbell, International Association of Oil and Gas Producers [OGP], 25/28 Old Burlington Street London, W1X 1LB, UK Email: John.Campbell@ogp.ogp.uk

Wales Wildlife and Countryside Link, 'Bryn Adern', The Bank, Newtown, Powys, SY 16 2AB Fax 01 686 622 339

Related website

The Oil and Gas directorate of the Department of Trade and Industry website is located at http://www.og.dti.gov.uk Guidance notes on the Offshore Petroleum Production and Pipelines [Assessment of Environmental Effects] Regulations 1999 are located on the website at
http://www.og.dti.gov.uk/ogpages/eis/eis.htm

The Information and Consultation site on the DTI's Strategic Environmental Assessment of the United Kingdom Continental Shelf is located at www.habitats-directive.org

The UK Offshore Operators Association Ltd. (UKOOA) is an organisation serving the interests of the offshore oil and gas industry. Their website outlines their Environmental Guidelines is located at http://www.ukooa.co.uk

1. Major bodies that exercise regulatory control over environmental aspects of offshore operations, either directly or indirectly

• Department of Trade and Industry
  

• Scottish Executive -Department of Environment and Rural Affairs
  

• Department for Environment, Food and Rural Affairs
  

• Department for Transport Local Government and the Regions
  

• Environment Agency
  

• Scottish Environmental Protection Agency
  

• Department of the Environment for Northern Ireland

The Department of Trade and Industry (DTI) is the lead regulator of discharges and emissions from the oil and gas industry, outside territorial waters. In waters within the 3 nautical mile zone, either the Environment Agency or the Scottish EPA, has regulatory environmental responsibility. Other Government Departments have a direct or indirect role and DTI seeks advice from other Government departments as appropriate.

DTI is responsible for oil and gas licensing and consults with a range of statutory and non-statutory bodies before awarding licences. These consultations can result in a series of conditions being attached to licences to safeguard other interests or the withdrawal of the area for licence.

DTI is also primarily responsible for measuring the environmental performance of the industry and works with the UK Offshore Operators Association (UKOOA) to obtain data from industry.

2. Major industry associations with instruments for environmental performance of offshore oil and gas activities.

• UK Offshore Operators Association (UKOOA)
  

• International Association of Drilling Contractors (IADC)
  

• Offshore Contractors Association (OCA)

3. National Regulatory Frameworks

i) Major environment legislation applying directly to offshore operations

• The Offshore Combustion Installations [Prevention and Control of Pollution] Regulations 2001
  

• Offshore Petroleum Production and Pipe-line (Assessment of Environmental Effects) Regulations 1999
  

• Prevention of Oil Pollution Act 1971
  

• Petroleum (Production) Act 1934
  

• Petroleum Act 1998
  

• Radioactive Substances Act 1993
  

• Petroleum and Submarine Pipelines Act 1975
  

• Offshore Installations (Emergency Procedures Regulations) 1976
  

• Merchant Shipping (Oil Pollution Preparedness, Response and Co-operation

• Convention) Regulations 1998
  

• Draft Offshore Chemicals Regulations 2001
  

• Offshore Petroleum Activities (Conservation of Habitats) Regulations 2001

Licenses for exploration and production are issued by DTI under the Petroleum (Production) Act, and extended by the Continental Shelf Act 1964. For the purpose of licensing, the UK Continental Shelf (UKCS) is divided into quadrants and divided further into blocks. There are two types of licence available to operators wishing to explore for oil and gas. An exploration licence allows for the drilling of bore holes and associated seismic activity in order to determine whether oil-bearing formations are likely to exist. This licence is not made exclusive to a single operator and does not provide automatic rights to production licences. A production licence is necessary to confirm a commercial find. A production licence is made available by DTI in licensing rounds. Licences include conditions relating to environmental protection and the needs of fisheries, defence, transport and other interests in the blocks concerned.

Before applying for a licence, operators are first required to provide a statement of their environmental policy together with an assessment of the environment, with mitigating measures to avoid or minimise the risk to the environment. This information, together with details of how they will comply with environmental conditions imposed by DTI, are drawn together to form the basis of an Environmental Protection Programme for the specific area. The Programme is a crucial part of the company's application to the DTI for an exploration licence.

Licensing Rounds

Following the announcement of a new licensing round, oil companies may be called upon to nominate blocks they would like to see offered for production. DTI consults with other government departments and relevant bodies, including the Joint Nature Conservation Committee (the government's statutory advisor on environmental issues), as to which blocks will be offered for licensing. Consideration of bids from operators is based on the company's financial and technical capabilities and an assessment of their environmental policies.

Monitoring

The DTI visit offshore installations and company offices for the purpose of verifying compliance with legal requirements. In addition since 1986, the UK has carried out surveillance flights over offshore installations in accordance with international obligations under the Bonn Agreement. These flights are unannounced and cover all offshore installations on the UK continental shelf.

• In order to assess the impact of the offshore oil and gas industry upon the environment, a range of biological and physical parameters are monitored to establish distribution and concentration of discharges. The main Government bodies with responsibility for monitoring are the Scottish Executive's Department for Environment, Food and Rural and the Department for Transport Local Government and the Regions

Requirements for seabed surveys and the monitoring hydrocarbon levels in sediments are imposed through license and discharge permit conditions.

Other Acts

The 'Prevention of Oil Pollution Act 1971' controls routine discharges of oil in produced waters, drainage water and oil on cuttings.

The Petroleum Act 1998 regulates the decommissioning and disposal of redundant oil and gas installations and pipelines on the UK continental shelf. Decommissioning decisions are taken in accordance with the UK's international obligations. There is not a specific reference to the environment within this piece of legislation.

ii) National environmental regulations which indirectly apply to offshore operations

• Health and Safety at Work Act 1974
  

• Environmental Protection Act 1990
  

• Waste Management Licensing Regulations 1994
  

• Special Waste Regulations 1996
  

• Merchant Shipping Act 1995
  

• Merchant Shipping (Prevention of Oil Pollution) Regulations 1996 (from

• MARPOL and deals with drainage water)
  

• Merchant Shipping (Prevention of Pollution by Garbage) 1988
  

• Coastal Protection Act 1949
  

• Continental Shelf Act 1964
  

• Food and Environmental Protection Act 1985 (deals with disposal of wastes at sea)
  

• Deposits in the Sea (Exemptions Order) 1985

iii) Negotiated agreements on environment between industry and government

Where legislation has not been brought in to regulate, there may exist a 'negotiated agreement' between DTI and industry.

An example is in the case of discharge of drilling muds and chemicals. In 1996, in line with the Paris Commission (PARCOM) Decision 92/2, DTI determined that the discharge of synthetic oil based mud on cuttings would no longer be permitted, as these were found to be less environmentally friendly than initially believed.

The DTI, other Government departments and industry have negotiated a reduction strategy for the discharge of synthetic muds, except esters, which resulted in zero discharges by the end of the year 2000. This has now been overtaken by OSPAR Decision 00/03, which effectively bans such discharges.

iv) Management instruments incorporated into national legislation applied to offshore operations

The carrying out of an EIA is now required for new offshore developments under the 1999 regulations. The 'Offshore Petroleum Production and Pipelines (Assessment of Environmental Effects) Regulations 1999' [which came into force 14 March 1999] now repeal the 1998 regulations. This regulation implements the EU Directive of 1985 on the Assessment of the Effects of Certain Public and Private Projects on the environment. The regulation may additionally require an Environmental Statement. It also advises licensees to hold consultations with interested parties. The guidance notes also state that consent may be refused where the project does not make provision for a comprehensive externally verifiable Environment Management System to be established for the lifetime of the project.
Many operators now undertake EIA as a standard procedure and as part of the companies' corporate environmental policy. The EC Regulation EC NO 761/2001 [19 March 2001] allows voluntary participation of organisations in the community's Eco-management and Audit scheme [EMAS]

4. International agreements applied to offshore operations via national regulations

International conventions have been written into legislation provisions to control discharges from offshore installations. Two examples include MARPOL (73/78) designed specifically to apply to shipping with the Merchant Shipping (Prevention of Oil Pollution) Regulations and applied to offshore drainage activities, and also the
OSPAR Convention, which controls oily water, discharges, oily contaminated drill cuttings, chemical discharges in water effluents and drilling wastes and debris/disposal of wastes at sea.

Other international agreements in place:

• Convention on the Continental Shelf 1958
  

• Convention on Fishing and Conservation of the Living Resources of the High Seas 1958
  

• Convention on the High Seas 1958
  

• Convention on the Territorial Sea and Contiguous Zone 1958
  

• United Nations Law of the Sea Convention 1982
  

• Convention on the Prevention of the Pollution of the Sea by Oil 1954
  

• Convention Under the Prevention of Pollution from Ships 1973
  

• OSPAR Convention 1992 (Oslo & Paris Conventions) -Convention on the

• Pollution of the Marine Environment of the North East Atlantic 1992
  

• Convention on Civil Liability for Oil Pollution Damage 1969
  

• Agreement for the Co-operation in Dealing with Pollution of the North Sea by Oil and Other Harmful Substances 1983
  

• The Accord of Co-operation for the Protection of the Coast and Waters of the North Atlantic Against Pollution Due to Hydrocarbons and Other Harmful Substances 1990
  

• Convention on Oil Pollution Preparedness Response and Co-operation 1990
  

• Convention on Long Range Transboundary Pollution 1979
  

• Convention on the Environmental Assessment in the Transboundary Context 1991
  

• Montreal Protocol on Substances that Deplete the Ozone Layer
  

• United Nations Framework Convention on Climate Change
  

• Protocol to the 1972 Convention of the Prevention of the Marine Pollution by the Dumping of Wastes and Other Matter

5. Major economic instruments applying directly to offshore environmental performance

There are no economic instruments in use at this time.

6. Voluntary environment measures adopted by the national oil industry

Voluntary codes have been produced by UKOOA including:
Atmospheric Emissions *
Seismic Activity *
Environmental Performance Reporting *
(Those marked * are publications which can be purchased from UKOOA)
Chemicals - see below (available from DTI)

Chemicals use and discharge- The use of chemicals is subject to a voluntary notification scheme administered by the DTI with input from the Ministry of Agriculture, Fisheries and Food, and the Scottish office Agriculture Environment and Fisheries Department. This scheme requires chemical suppliers to furnish information and operators to record use and discharge of these chemicals on a monthly basis, returning information to DTI. The new draft Chemicals regulations 2001,when in force will implement the OSPAR decision on a harmonised mandatory control system for the use and reduction of the discharge of Offshore Chemicals. This decision introduce a new approach involving comprehensive testing, pre-screening, ranking, risk assessment of chemicals and the substitution of certain chemicals by less hazardous alternatives.

In safeguarding the offshore environment UKOOA have produced a 'Statement of Guidelines' which outlines guiding principles for its member companies. They are located at http://www.ukooa.co.uk/envguide.html

Good practice guidelines have also been produced to assist operators in the implementation of environmental objectives and strategies on topics including 'Environmental Management Systems', 'Internal Audit and Training', 'Exploration Operations in Nearshore and Sensitive Areas' and 'Reducing Atmospheric Emissions from Oil and Gas Facilities'.

Other Actions

The Atlantic Frontier Environmental Network (AFEN) is an example of a co-ordinated and strategic approach to environmental management by 21 oil industry operators in the UK Atlantic margin. The oil companies in this area work together with government and regulatory authorities, academic research community and interested parties. The objective of the network is to understand the environment better and to establish an environmental baseline for the licensed area. The AFEN are a focus for a range of regional activities and studies and believe that by adopting a joint approach to the area and integrating both local and regional studies much better data can be obtained and a more efficient use of resources. For further information visit the website located at
http://www.ukooa.co.uk/issues/

The Joint Nature Conservation Committee (JNCC) is an official government advisory body established under the Environmental Protection Act 1990. DTI seek the views of this forum in relation to blocks nominated for new licences. Their website is located at http://www.jncc.gov.uk

A co-operative research Programme has been established to minimise environmental liabilities arising from offshore petroleum developments, particularly those in ecologically sensitive provinces on continental margins. Known as 'Managing Impacts on the Marine Environment' the website is located at
http://www.marinetech.co.uk/MTS/Projects/pMIME.htm

Environmental Regulations for United Kingdom Oil and Gas Industry-
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