Oil & Gas UK

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How The Industry Is Regulated

Although the DTI takes the lead on most issues relating to the offshore oil and gas industry, our activities are actually regulated by a number of Government Departments. Given the nature and scale of our industry and its complexity, this is not surprising. The DTI has authority over a great many routine activities (for example, drilling a new well), and where environmental issues are involved it will authorise an activity only after detailed consultation with other Government Departments. The Ministry of Agriculture, Fisheries and Foods (MAFF), the Scottish Executive and the Joint Nature Conservation Committee (JNCC) will all be consulted, and in some situations, the final decision will be reached following public consultation.

The major regulations currently governing our industry are shown below. But, as we have already mentioned, the Government has embarked on a major programme of new legislation under the recently enacted Pollution Prevention and Control (PPC) Act.

The Government's intention is to introduce a series of separate regulations covering specific activities which, in the long term, will constitute a fully integrated set of regulations covering all aspects of the offshore oil and gas industry that have the potential to cause a significant environmental impact. UKOOA will be reviewing these issues carefully with the Government as these new regulations are drafted, and we will recommend strongly that they should balance environmental benefits with all the other benefits our industry brings to the UK.

The table which follows excludes the first set of regulations issued under the PPC Act as these are still in the process of consultation.

Panel 1: The Main UK Environmental Legislation and Agreements Applying to the Offshore Industry
License Conditions for each licensing round specify the general environmental requirements and restrictions that apply to exploration and production activities in the acreage concerned. They also contain specific requirements for exploration wells.
The Petroleum Act 1998, this consolidated many of the regulations which apply to the offshore oil and gas industry and covers environmental and other issues.
The Prevention of Oil Pollution Act, 1971, as amended, prohibits any discharge of oil into the sea from oil and gas operations unless an exemption has been specifically issued. An exemption is therefore required for all exploration and production discharges that contain residues or traces of mineral oil. Controlled discharges include produced water, oil-based mud drill cuttings, sands and sludges. Specific requirements regarding oil content, sampling, analysis and reporting requirements are included with each exemption.
The Merchant Shipping (Prevention of Oil Pollution) Regulations, 1996, place restrictions on the discharge to sea of oily water from machinery and non-hazardous drains. Following inspection, installations are issued with a UK Oil Pollution Prevention Certificate or equivalent International Oil Pollution Prevention Certificate, which confirm that the equipment meets the required standards.
The Food and Environment Protection Act, 1995, prohibits the discharge of waste and the placing or depositing materials on or under the seabed unless a license has been issued. However, because of the nature of offshore operations, the regulatory authority introduced the Deposits in the Sea Exemptions Order, 1985, to exempt all non-oily discharges from the licensing requirements of this act.
The Merchant Shipping (Prevention of Pollution by Garbage) Regulations, 1990, prohibited the overboard disposal of garbage. This legislation was strengthened in 1998 (see Panel 2).
The Petroleum and Submarine Pipelines Act, 1995, requires consent to be obtained for pipeline pre-commissioning and commissioning discharges. Specific conditions are placed on each separate discharge.
The Radioactive Substances Act, 1993, requires operators to obtain an authorisation to store or dispose of scales or sludges that arise from the production process and contain levels of natural radiation over a certain concentration.
The Energy Act, 1978, requires operators to obtain a consent for the flaring and venting of gas.
The Environmental Protection Act, 1990, and associated legislation applies to all controlled waste returned to shore for disposal.
The Petroleum Operations Notice Number 1 requires the reporting of offshore oil spills (see Panel 2).
The Offshore Chemical Notification Scheme is an agreement covering the use and discharge of production, utility, drilling and cementing chemicals. The scheme controls the use and discharge of certain particularly toxic chemicals and sets limits on the use of all other chemicals (see below).

Panel 2: Environmental Legislation Introduced in 1998
The Merchant Shipping (Oil Pollution Preparedness Response and Co-operation Convention) Regulations, 1998, introduced specific requirements for oil spill contingency plans for mobile and fixed offshore installations, and confirmed the requirements to report all oil spills.
The Offshore Petroleum Production and Pipelines (Assessment of Environment Effects) Regulations, 1998, introduced a requirement for an environmental statement to be prepared for offshore projects of a certain size, or where there may be significant environmental effects. These regulations have been further revised in 1999.
The Merchant Shipping (Prevention of Pollution by Garbage) Regulation, 1998, introduced a number of requirements for waste disposal management offshore and requires the preparation of management plans.

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