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Ref. Ares(2012)903367 - 25/07/2012
International Association of Oil & Gas Producers
Annexes to
OGP Position Paper on
EU Commission proposal for a Regulation of Safety on Offshore oil and gas
prospection, exploration and production activities (COM (2011) 688 Final)
Contents
Attachment 1 – Subject, Scope & Definitions and Third Party Verification ............ 2
Attachment 2 – Risk and Liability .......................................................................... 9
Attachment 3 – Major Hazard Report .................................................................. 11
Attachment 4 - Competent Authorities ................................................................ 14
Attachment 5 – Emergency Response ................................................................. 18
Attachment 6 – Public Participation ..................................................................... 22
Attachment 7 – Delegated Acts ........................................................................... 27
Attachment 8 – Transboundary Effects ............................................................... 30
Attachment 1 – Subject, Scope & Definitions and Third Party Verification
Article 1
Subject and Scope
Text proposed by the Commission
OGP proposed amendment
1. This Regulation establishes minimum Due consideration should be given to
requirements for industry and national choosing a Directive rather than a
authorities involved in offshore oil and gas Regulation as the legislative form.
operations performed following the award
of an authorisation pursuant to Directive
94/22/EC.
Justification:
The upstream industry wishes to record its concern that in choosing to legislate through
a Regulation rather than a Directive, there is a clear risk that rules at a European level
will conflict with existing national rules, providing for duplication, confusion and
uncertainty (and possible delays) for the upstream industry. The upstream industry
believes this risk has not yet been sufficiently assessed.
Furthermore, the Commission‟s proposals incorporate all aspects of the upstream
industry from exploration, through production to decommissioning and field
abandonment, rather than addressing a „significant well control incident‟ that was the
starting point of this process. A compelling reason for this broadening of scope has not
been provided.
Article 2
Definitions Text proposed by the Commission
OGP proposed amendment
For the purpose of this Regulation:
For the purpose of this Regulation:
1. 'acceptable' shall mean: rendering a risk 1. 'acceptable' shall mean: rendering a risk
of a major accident tolerable to the of a major accident
as low as
furthest extent beyond which no significant
reasonably
practicable
(ALARP)
reduction of the risk is derived from the tolerable to the furthest extent beyond
input of further time, resources or cost;
which no significant reduction of the risk
is derived from the input of further time,
resources or cost
‘ALARP’ shall mean: a
residual
risk
that
must
be
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insignificant in relation to the
sacrifice (in terms of money, time or
trouble) required to avert or further
reduce it;
12. 'independent third party verification' 12. 'independent third party verification'
shall
mean:
an
assessment
and shall
mean:
an
assessment
and
confirmation of the validity of particular confirmation of validity of that which is
written statements by a natural or legal being
examined
by
a
competent
person that is not under the control or person/body that is independent from the
influence by the author of the statements; work under review, and the management
lines of those whose work is being
checked; an assessment and confirmation
of the validity of particular written
statements by a natural or legal person
that is not under the control or influence
by the author of the statements;
13. 'industry' shall mean: private 13. 'industry' shall mean:
undertakings
companies that are directly involved in private companies that are directly
offshore oil and gas activities pursuant to involved in offshore oil and gas activities
this regulation or whose activities are pursuant to this Regulation or whose
closely related to those operations;
activities are closely related to those
operations;
18. 'major accident' shall mean: an 18. „major
offshore accident‟ shall mean:
occurrence such as fire or explosion, an occurrence such as fire or explosion,
significant loss of well control or significant significant loss of well control or significant
escape
of
hydrocarbons
to
the escape
of
hydrocarbons
to
the
environment, significant damage to the environment
resulting
from
installation or equipment thereon, loss of
uncontrolled developments in the
structural integrity of the installation, and
course of the operation of any
any other event involving death or major
installation and leading to significant
injury to five or more persons on or damage to the installation or equipment
working in connection with the installation; thereon, loss of structural integrity of the
installation, and any other event involving
death
multiple fatalities or major injury
to five or more
casualties to persons on
or working in connection with the
installation
or connected installations;
21. 'offshore oil and gas operations' shall 21. 'offshore oil and gas operations' shall
mean: all activities related to exploring for, mean: all activities
on installations
producing or processing of oil and gas related to exploring for, producing or
offshore. This includes transport of oil and processing of oil and gas offshore. This
gas
through
offshore
infrastructure includes transport of oil and gas through
connected to an installation or subsea
connected
offshore
infrastructure
installation;
connected to an installation or subsea
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installation.
22. 'operator' shall mean: the operator of a 22. 'operator' shall mean:
production installation or the owner of a
-
the
holder
of
a
relevant
non-production installation and the well
authorisation or permit issued by a
operator of a well operation. Operator and
public authority; or
licensee both come under the definition of
- the co-holder of an authorisation or
Article 2(6) of Directive 2004/35/EC;
a permit issued by a public authority
and designated operator by virtue of
an operating agreement concluded
with the other authorisation or
permit holder(s), or
- an entity not the holder of an
authorisation or a permit issued by a
public
authority,
but
instead
designated operator by virtue of an
operating agreement concluded with
the authorisation or permit holder(s).
the operator of a production installation or
the owner of a non-production installation
and the well operator of a well operation.
Operator and licensee both come under
the definition of Article 2(6) of Directive
2004/35/EC;
30. 'risk' shall mean: the likelihood of a 30. „risk‟ shall mean:
the likelihood
that a
specific effect occurring within a specific
hazard will actually cause its adverse
period or in specified circumstances;
effects, together with a measure of
the effect of a specific effect occurring
within a specific period or in specified
circumstances;
33. 'well operator' shall mean: the person 33. 'well operator' shall mean: the person
appointed by the licensee to plan and appointed by the licensee to plan and
execute a well operation.
execute a well operation.
Justification
OGP believes any kind of legislation brings with it an onus for setting out clear and
unambiguous definitions. In the proposed Regulation there are several examples where
the drafting needs to be tightened, or changed so that the intent of the Regulation is
reflected in practice.
The proposed Regulation is intended to describe „minimum requirements‟. A requirement
to adopt 'best practice' as a common denominator in formal legislation will not be
consistent with Regulation in North Sea waters required standard for legal compliance.
Hence, a new requirement to adopt „best practice'in EU legislation would be a major
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departure from this.
Additionally, OGP believes that „best practice‟ would normally only be applied for a very
specific subject by the best in class, whereas other contractors or operators still have a
number of different options in the field. When shared within the upstream industry, best
practice may become good practice if adopted by the majority of players, or be adopted
via recognised standards, guidelines and procedures. As the term „best practice‟ is
misleading, OGP suggests to use instead the term „good (oilfield) practice‟ which can be
described as locally, nationally, regionally or internationally recognised standards,
guidelines and procedures, frequently applied by the majority of the players in the oil
and gas industry.
In addition, there are a number of terms used in the Regulation that need more formal
definition for the sake of clarity. Therefore OGP proposes the following:
Ad 2.1.:
OGP holds the opinion that the definition of “acceptable” as it currently stands, is
ambiguous and contains a number of words that themselves are in need of definition,
for the purpose of the Regulation (such as „tolerable‟, „significant‟ and „reduction‟). In
some interpretations the definition would imply that an operator would need to take
measures beyond those that render the risk „tolerable‟. This is self-serving and the
upstream industry would greatly prefer „acceptability‟ to be based on the well-known
and understood ALARP principle (As Low As Reasonably Practicable). The upstream
industry recognises that there is no unique and fully comprehensive definition of ALARP,
but the principle has been used with considerable success in the North Sea.
Ad 2.12.:
OGP suggests including internal resources in the definition of third party (see in addition
suggestions for amendments to Article 15).
Ad 2.13.:
As the definition of „industry‟ does not include state-owned entities, OGP suggests
defining it broader in the form of „undertakings‟.
Ad 2.18.:
The definition of “major accident” is ambiguous. OGP suggests amendments that are in
line with the existing definition for „major accident‟ already enshrined in EU law (Seveso
Directive).
Ad 2.21.:
OGP suggests adding installations and connected infrastructure into the definition of
'offshore oil and gas operations' as these are closely linked to upstream activities. OGP
suggests making clear that 'offshore oil and gas operations' means those activities
taking place on installations and in connected infrastructure. Otherwise the definition
could, for example, include onshore support facilities, e.g. waste reception at ports.
Ad 2.22.:
OGP believes that the definition for „operator‟ needs to consider the following logical
distinction between (i) the (collective) parties who bear liability for the purposes of the
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ELD - which liability can then be apportioned or held jointly (as provided for in national
legislation) and (ii) the single person responsible for performing obligations linked to
operations, such as risk assessment and emergency response. Therefore, the definition
of operator should be different for each. OGP does not think the ELD definition, which
permits multiple parties to be operators, is appropriate and prefer a definition properly
tailored to fit the circumstances. The ELD definition is also very opaque. The concept of
who "controls" an occupational activity is not entirely clear - this could, for example, be
a drilling contractor; whilst the operator appointed under a Joint Operating Agreement
may in actual fact not be the party with 'decisive economic power' (if that implies ability
to control Operating Committee decisions). For operational obligations, there needs to
be absolute clarity as to which single party is responsible.
The Regulation needs to reflect this.
The definition of “exploration licence” (2.10.) and “production licence” (2.27.) deliberately
establishes the requirement for the separation of licences for exploration and production.
It is not clear if the proposal is consistent with current Member States’ practices that
allow, but do not mandate, different phases of activities to be licensed or if Member
States will be required to modify existing processes, which are compliant with the
Hydrocarbon Licensing Directive (94/22/EC).
Ad 2.30.:
OGP suggests that the definition for „risk‟ needs further clarification as the size of a spill
does not necessarily describe the extent of a potential impact, for example on the
environment.
Ad 2.33:
The definition of well operator is ambiguous. As written, it suggests that only a licensee
can appoint a well operator, which is not always the case. It can also be a contractor
appointed by an operator.
Article 15
Independent Third Party Verification
Text proposed by the Commission
OGP proposed amendment
1. Operators shall establish a scheme for 1. Operators shall establish a scheme for
independent third party verification and independent third party verification
for
well examination and shall describe such and well examination and shall describe
schemes within the major accident policy such schemes within the major accident
integrated into the Major Hazards Reports policy integrated into the Major Hazards
pursuant to Article 18.
Reports pursuant to Article 18.
2. The selection of the independent third 2. The selection of the independent third
party verifier and the design of schemes party verifier and the design of schemes
for independent third party verification and for independent third party verification and
for independent well examination shall for independent well
design examination
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meet the criteria of Annex II, part 5.
shall meet the criteria of Annex II, part 5.
3. The scheme for independent third party 3. The scheme for independent third party
verification in respect of production and verification
of well design in respect of
nonproduction installations shall be production and nonproduction installations
established:
shall be established:
(a) in respect of installations to give (a) in respect of installations to give
independent assurance that the specified independent assurance that the specified
systems and safety critical elements systems
, and
where appropriate safety
identified in the risk assessments and critical elements
, as identified in the risk
safety management system for the assessments and safety management
installation are suitable and up to date, system for the installation, are suitable and
and the schedule of examination and up to date, and the schedule of
testing of the major hazards control examination and testing of the major
system is suitable, up to date and hazards control system
s are is suitable, up
operating as intended;
to date and operating as intended;
(b) in respect of well plans to give (b) in respect of well plans, to give
independent assurance that the well independent assurance that the well
design and well control measures are design and well control measures are
is
suitable to the anticipated well conditions suitable to
for the anticipated well
and kept as the basis if the well design conditions and
is kept
updated as the
changes for whatever reason.
basis if the well design changes for
whatever reason.
4. Operators shall ensure that outcomes of 4. Operators shall ensure that outcomes of
the independent third party verification the independent third party verification
scheme pursuant to this Article under scheme pursuant to this Article under
paragraph 3(a) are available to the paragraph 3(a) are available to the
competent authority upon its request.
competent authority upon its request.
7. Non-production installations operated in 7. Non-production installations operated in
Union waters shall meet the requirements Union waters shall meet the requirements
of relevant international conventions as of relevant international conventions as
defined in Regulation 391/2009/EC of the defined in Regulation 391/2009/EC of the
European Parliament and of the Council of European Parliament and of the Council of
23 April 2009 or the equivalent standards 23 April 2009 or
. New mobile offshore
of the Code for the construction and
drilling
units
(MODUs)
whose
equipment of mobile offshore drilling units
construction began after 1st January
(2009 MODU CODE). They shall be
2012 shall meet the equivalent
certified by an organisation that is standards of the Code for the construction
recognised by the Union in accordance and equipment of mobile offshore drilling
with the aforementioned Regulation.
units (2009 MODU CODE). They shall be
certified
as meeting the necessary
requirements by an organisation that is
recognised by the Union in accordance
with the aforementioned Regulation.
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Justification:
Ad 15.1., 15.2. and 15.4.:
Operators take responsibility for safety. Well design and well procedures aimed at
prevention and resilience begin with a three-tier review process to further assure that a
company is adhering to its own processes and procedures within the framework defined
by the local regulator. This means two levels of review for the operator, plus the
regulator. Member States should require operators to define those well operations
subject to the three-tier review process based on due consideration of the level of
risk/hazard.
The upstream industry is of the opinion that independent verification can be carried out
by a credited or authorized person or body, including such a person or function within
the operator‟s organisation where the appropriate organisational arrangements are
made to maintain that person or function‟s independence. The reviewer/verifier shall be
a competent person/body that is independent from the work under review, and the
management lines of those whose work is being checked. This has been the accepted
practice in a number of Member States within the upstream industry, as well as other
industries such as the petrochemical industry. There has been no justification why this
would need to be changed.
Ad 15.3. (a):
The suggestion for amendment reflects the fact that not all systems that might be
identified in the risk assessments and safety management system for an installation
would comprise safety critical elements.
Ad 15.7.:
As proposed by the Commission, this has the impact of limiting the pool of drilling rigs
which can be used. Many units currently working in the North Sea do not meet the 2009
Code requirements. The 2009 MODU Code was updated from the 1989 and 2001 IMO-
MODU Codes, and is primarily intended for new drilling rigs built after 2009. If this is
applied to older units there is a strong risk that most of MODUs in EU waters would be
rendered unusable, due to significant and unfeasible changes required to bring them in
line with the 2009 requirements.
The 2009 Code is only applicable to units whose construction begins after 1 January
2012, therefore a mandate to apply the 2009 MODU Code to all existing rigs would be
extremely disruptive with regard to both current and planned operations within the EU.
Many of the changes required by the 2009 Code may not materially contribute to the
reduction of major safety or environmental risks. Further, in the case of those European
countries where a Safety Case type regime is in place, any deficiencies in the earlier
versions (1989 and 1979) of the MODU Code with respect to fire and blast resistance, or
escape and evacuation, should be addressed, and the associated risks reduced to “as
low as reasonably practicable” and meet approximately the same risk level of new rigs
built in accordance with the 2009 Code.
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Attachment 2 – Risk and Liability
Article 4
Safety considerations within authorisation of offshore oil and gas activities
Text proposed by the Commission
OGP proposed amendment
4.3. Authorisations for offshore oil and gas 4.3. Authorisations for offshore oil and gas
exploration operations, and for production exploration operations and for production
operations shall be granted separately.
operations shall be granted separately
in
accordance with Article 1.3 of
Directive 94/22/EC.
Justification
Clarification is needed whether „authorisations‟ refers to or includes granting of licenses
or subsequent consents under a license. It is normal in many Member States to grant
licences in a staged approach, with subsequent consents issued for different phases of
activities. On the grounds of offshore safety there is no reason to amend this practice.
The Commission‟s text is consistent with current practice as proposed in Directive
94/22/EC.
The offshore exploration phase entails significant upfront investments, typically
consisting of the gathering of seismic data and drilling of extensive exploration wells; all
with an uncertain outcome. It would be extremely difficult for companies to make a
decision to embark on financially high-risk exploration activity without, at the same time,
having the assurance that given a positive outcome during the exploration phase, the
same companies may secure the right to participate also in the revenue-generating
production phase.
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Article 7
Liability for environmental damage
Text proposed by the Commission
OGP proposed amendment
1. The licensee is liable for the prevention OGP suggests deferring Article 7, together
and remediation of environmental damage with Article 37, for further consideration of
, pursuant to Directive 2004/35/EC, caused the costs, benefits and impact assessment,
by offshore oil and gas activities carried including the potential impact on liability
out by the licensee or any entity provisions to be made by licensees.
participating in the offshore oil and gas
operations on the basis of a contract with Ultimately, it might be best to withdraw
the licensee. The consenting procedure for these both from the proposed Regulation
operations pursuant to this Regulation and include them in the ongoing
shall not prejudice the liability of the Commission review of risks and liability
licensee.
provisions.
Justification
Together with Article 37, Article 7 may have a significant impact on liabilities for offshore
operations and these should be carefully assessed in the ongoing Commission
assessment of risk and liability provision pursuant to Recital 48 of this Regulation.
Introducing and implementing legislation in this area, until the broader question of
liability has been assessed, makes little sense and raises the level of legal uncertainty for
undertakings engaging in offshore oil and gas activities.
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Attachment 3 – Major Hazard Report
Article 13
Notification of well operations
Text proposed by the Commission
OGP proposed amendment
1. No less than 21 days prior to the start of 1. No less than 21 days prior to the start of
a well operation, the well operator shall a well operation,
or such shorter period
send to the competent authority a
as the competent authority may
notification containing details of the design
specify, the well operator shall send to
of the well and its operation in accordance the competent authority a notification
with the requirements of Annex II, part 4.
containing details of the design of the well
and its operation in accordance with the
requirements of Annex II, part 4.
Justification
OGP believes that, under certain circumstances, there may be a need for some flexibility
to the time scale, with the approval of the competent authority, to allow for unforeseen
well operations to be done without undue delay.
Article 16
Power to prohibit activity
Text proposed by the Commission
OGP proposed amendment
1. The competent authority shall prohibit 1. The competent authority shall
have the
the operation or bringing into operation of
power to prohibit the operation or
any installation or any part thereof where bringing into operation of any installation
the measures proposed by the operator for or any part thereof where the measures
the prevention and mitigation of major proposed by the operator for the
accidents pursuant to Articles 10, 11, 13 prevention and mitigation of major
and 14 are considered seriously deficient.
accidents pursuant to Articles 10, 11, 13
and 14 are considered seriously deficient.
Justification
OGP believes that any decision by a competent authority to prohibit upstream activities
can only be taken following a process of dialogue with the installation operator.
Furthermore it needs clear criteria to enable a transparent decision-making process. The
power to prohibit operations seems to exist with most, if not all, established regulatory
authorities. In regions like the North Sea, competent authorities follow a transparent
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enforcement protocol. For this reason clear criteria need to be formalised by the
competent authorities for how this power would be executed. Finally, OGP would have
concerns if the Regulation came into force before the necessary inspection staff were
competent to use the power, when justified, to enforce MHR requirements.
Article 18
Major accident prevention by operators
Text proposed by the Commission
OGP proposed amendment
1. Operators shall prepare a document 1. Operators shall
have prepare a
setting out their major accident prevention document setting out their major accident
policy, and ensure that it is implemented prevention policy and ensure that it is
throughout the organisation of their implemented throughout the organisation
offshore operations, including by setting of
their
organisation, including offshore
up appropriate monitoring arrangements operations, including by setting up
along
to assure effectiveness of the policy.
with appropriate monitoring arrangements
to assure effectiveness of the policy.
2. The document pursuant paragraph 1 2. The document pursuant paragraph 1
shall
be
submitted
to
competent shall
be
submitted
to
competent
authorities as a part of the Major Hazard authorities as a part of the Major Hazard
Report pursuant to Articles 10 and 11 or as Report pursuant to Articles 10 and 11 or
as
the notification of well operations pursuant
part of the notification of well operations
to Article 13.
pursuant to Article 13.
5. Operators shall establish, and regularly 5. Operators
Competent authorities
consult with the representatives of the shall establish, and regularly consult with
relevant Member States pursuant to Article the
industry representatives of the
27, the industry priorities for preparing relevant Member States pursuant to Article
and/or revising standards and guidance for 27, the industry priorities for preparing
best practice in control of offshore major and/or revising standards and guidance for
accident hazards throughout the design best practice in control of offshore major
and operation lifecycle of offshore accident hazards throughout the design
operations, and as a minimum shall follow and operation lifecycle of offshore
the outline in Annex IV.
operations, and as a minimum, shall follow
the outline in Annex IV.
Justification
Ad 18.1. and 18.2.:
OGP supports the importance of preventing major accidents by improving safety
performance during production and well operations. The upstream industry presumes
that safety management includes environmental considerations, although environmental
management is not explicitly covered in the article itself.
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Ad 18.5.:
OGP considers that it is not the operator who establishes standards and guidance for
best practice. The competent authorities do this in consultation with the operators.
Annex IV
Provisions by operators for prevention of major accidents
Text proposed by the Commission
OGP proposed amendment
4. Operators shall ensure that hazardous 4. Operators shall ensure
in so far as is
substances are at all times contained
reasonably practicable that hazardous
within the pipelines, vessels and systems substances are at all times contained
intended for their safe confinement. In within the
in pipelines, vessels and
addition, operators shall ensure that no systems
intended
for
their
safe
single failure of a barrier to loss of confinement. In addition, operators shall
containment can lead to a major hazard ensure
in so far as is reasonable
incident.
practicable that no single failure of a
barrier to loss of containment can lead to a
major hazard incident.
Justification
This is one of a number of instances throughout the draft where operators are required
to "ensure" particular outcomes. It is the view of OGP that this would impose an
absolute obligation which could be breached despite operators having taken all such
precautions as they might reasonably be expected to take in the circumstances, applying
good industry practice. This would seem to be unnecessarily harsh in light of the fact
that in Member States, such as the UK, sanctions for non-compliance with Health, Safety
and Environment Regulations (HSE) typically take the form of criminal offences and in
others may impose equally serious sanctions. OGP notes that other EU Directives, such
as the Health and Safety Directive, couple a requirement to "ensure" an outcome with
defences that have the effect of limiting liability where incidents occur despite the
exercise of all due care. The current draft Regulation does not include any comparable
qualification. Imposing an unqualified absolute requirement on operators in this manner
would be a significant departure from the UK regime, which applies the standard that
operators must ensure safety "in so far as is reasonably practicable".
Additionally, the proposed Regulation, notably Annex 4 (4) would appear to prohibit the
use of HIPS instrumentation systems. This needs to be clarified, as HIPS systems are in
widespread use offshore. These may be acceptable if they have been assessed against
BS EN 61508/61511 requirements. You could also argue that the pressure envelope (a
pipe or vessel) is a single barrier to loss of containment, and this will always be the
case.
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Attachment 4 - Competent Authorities
Article 27
Cooperation between Member States
Text proposed by the Commission
OGP proposed amendment
3. Clear priorities and procedures should 3. Clear priorities and procedures should
be established for the preparation and be
established
by
competent
updating of guidance documents in order
authorities for the preparation and
to
identify
and
facilitate
the updating of guidance documents in order
implementation of the best practices in to
identify
and
facilitate
the
areas pursuant to paragraph 2.
implementation of the best practices in
areas pursuant to paragraph 2.
Justification
It is not clear who would be responsible for establishing „priorities and procedures‟.
Given that the Regulation has direct effect, it is important to specify whose responsibility
it would be to establish those priorities and procedures.
Article 28
Coordinated approach towards the safety in adjacent regions and
international activities
Text proposed by the Commission
OGP proposed amendment
3. The Commission shall promote high 3. The Commission shall promote high
safety standards for offshore oil and gas safety standards for offshore oil and gas
operations at international level at operations at international level at
appropriate global and regional fora, appropriate global and regional fora.
including those related to Arctic waters.
including those related to Arctic waters.
Justification
OGP believes it inappropriate to single out particular maritime regions and proposes
deleting the reference in Article 28 ‟arctic waters‟ as it is already covered implicitly within
the existing text.
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Article 38
Requirements on documents related to consenting procedure
Text proposed by the Commission
OGP proposed amendment
Operators of installations shall comply in Operators of installations shall comply in
full with this Regulation within 2 years of it full with this Regulation within
3 2 years of
coming into effect, with the following it coming into effect, with the following
exceptions:
exceptions:
(a)
Operators
for
non-production (a)
Operators
for
non-production
installations that are under contract but installations that are under contract but
not yet established on location shall not yet established on location shall
comply in full with this Regulation within 1 comply in full with this Regulation within
2
year of it coming into effect, or earlier by
1 years of it coming into effect, or earlier
agreement with the competent authority.
by agreement with the competent
authority.
(b) Operators of planned installations shall (b) Operators of planned installations shall
comply in full with this regulation unless comply in full with this r
Regulation unless
otherwise agreed with the competent otherwise agreed with the competent
authority, and in any case no later than authority, and in any case no later than
within 1 year of it coming into effect.
within
2 1 years of it coming into effect.
(c) Well operators shall comply in full with (c) Well operators shall comply in full with
this Regulation within 3 months of it this Regulation within
12 3 months of it
coming into effect, or earlier by agreement coming into effect, or earlier by agreement
with the competent authority.
with the competent authority.
(d) Where the competent authority
identifies
existing
installations
presenting lower risks, these will be
subject to longer transition periods to
be notified to the Commission by the
relevant competent authority.
Justification
OGP believes that the transitional periods foreseen in Article 38 should be extended as
the limited time available might be insufficient to complete the update of the Major
Hazard reports by the deadline. This could lead to the unintended consequence of a de
facto moratorium on drilling and production activities.
An extension of the transition periods would also promote consistency between national
legislations and the Regulation and compliance therewith by all parties. There are
potentially significant changes required to national legislation in order to avoid overlap
or misalignment with the proposed Regulation. Additionally, meeting the suggested
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requirements would constitute a significant effort in those Member States with large oil
and gas industry and a high number of existing installations.
Any transition timeline should follow a risk-based approach to allow the prioritisation of
effort on higher risk activities and not to follow a „one-size-fits-all‟ approach. In addition,
competent authorities should take responsibility for notifying to the Commission.
OGP would also like to recall that the changes in the UK legislation after the Piper Alpha
disaster took four years to be implemented. The British „Safety Case‟ is now considered
in the Impact Assessment of the proposal as Option 1. In OGP‟s view, it is clear that two
years to achieve a more ambitious goal (Option 2) are not enough.
Additionally, the upstream industry is concerned that Member States, particularly those
which are only beginning to develop offshore oil and gas activities, would need to
establish a competent authority in a very short timeline. Member States without a
competent authority yet in place, would need to appoint its staff before any
assessments could be completed – and might not be able to find enough skilled and
experienced staff assessors. This could trigger a drain on already-established regulators
to assist in new-agency formations in the Adriatic, Baltic and Black Sea. A lack of
competent staff would subsequently delay the review of Major Hazard Reports.
Annex III
Provisions by competent authorities for regulation of major hazards
operations
Text proposed by the Commission
OGP proposed amendment
2. Member States should make the 2. Member States should make the
necessary provisions to bring the above necessary provisions to bring the above
arrangements into effect, including:
arrangements into effect, including:
(d) where appropriate, to require operators (d) where appropriate, to require operators
and/or installation owners to indemnify the and/or installation owners to
compensate
competent authority for the cost of its
the competent authority for services
functions carried out pursuant to this
(e.g. inspectors’ visits) rendered on
regulation;
fees or rates which are calculated on
basis of objective, transparent and
proportionate criteria so as to ensure
fair contribution by those involved in
all existing and future operations.
indemnify the competent authority for the
cost of its function carried out pursuant to
this regulations
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Justification
OGP sees the appointment of competent authorities by Members States as a positive
step. The responsibility for setting up and funding these institutions must lie with the
Member States.
A problem may exist when a Member State with no established competent authorities
attempts to appoint its own and cannot provide competent staff assessors. This could
place a drain on established regulators to assist in setting up any new agency.
Currently in Annex III, 2 (d) a provision is included, indicating that operators might be
required to „indemnify the competent authority‟ for the cost of its functions carried out
pursuant to this Regulation. It is not clear at all how such an indemnity might be
calculated. In addition, in countries where there is only one operator, or a limited
number, the operator should not bear the full costs of the competent authority to
comply with this Regulation.
It is not uncommon for operators to pay fees to the regulatory authorities, to cover for
instance inspectors‟ visits, but these fees need to be clearly and fairly specified and
neither the entire share of the burden, nor the entire scope of actions of a safety
regulator should be shouldered by a single operator alone. In any case, the calculation
criteria need to be objective and proportionate to ensure a fair contribution of all
existing and future operators.
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Attachment 5 – Emergency Response
Article 12
Internal emergency response plans
Text proposed by the Commission
OGP proposed amendment
1. Operators shall prepare internal 1. Operators shall prepare internal
emergency response plans taking into emergency response plans taking into
account
the
major
accident
risk account
the
major
accident
risk
assessments
undertaken
during assessments
undertaken
during
preparation of the most recent major preparation of the most recent major
hazard report. In the case of drilling a well hazard report. In the case of drilling a well
from a mobile non-production installation, from a mobile non-production installation,
the risk assessment pursuant to the well the risk assessment pursuant to the well
notification should be incorporated into the notification should be incorporated into the
emergency response plan for the emergency response plan for the
installation.
installation.
2. For production and non-production 2. For production and non-production
installations, the internal emergency installations, the
operator shall submit
response plan shall be submitted to the
to the competent authority the internal
competent authority as part of the Major emergency response plan shall be
Hazard Report.
submitted to the competent authority as
part of the Major Hazard Report.
Justification
Provision of internal emergency plans is current common practice in the upstream
industry and OGP supports this as an example of good oilfield practice.
In OGP‟s experience, there are different definitions or usages with regard to the role of
operators within Member States. Article 12 does not follow exactly the definitions in
Article 2. This needs further clarification.
Ad 12.1.:
„Notification‟ needs to be deleted as the risk assessment relates to the well, not to the
notification.
Ad 12.2.:
There is a need for clarity on the scope of the emergency plan (definition 2. 15 –
„requires an overview‟) which is to be included within the MHR, as well as the
relationship between internal and external emergency plans, OPEP‟s (Oil Pollution
Emergency Plans), and national contingency plans.
For wells, the OPEP is usually owned by the well operator in the case of a non-
production installation. Guidance is required on how these well plans are to be
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integrated into a non-production installation emergency plan. For example, in the UK
responsibility for spill response rests with well operator, not the rig operator.
Article 29
Requirements for internal emergency response plans
Text proposed by the Commission
OGP proposed amendment
1. Internal emergency response plans shall 1. Internal emergency response plans shall
be prepared by the operator so as to:
be prepared by the operator so as to:
(a) be initiated to contain an incipient (a) be initiated to contain an incipient
major accident within the installation, or major accident within the installation, or
within the exclusion zone established by
prevent
escalation
or
limit
the Member State around the perimeter of
consequences of an accident related
the installation, or subsea wellhead;
to offshore oil and gas operations
within the
an exclusion zone established
by the Member State around the perimeter
of the installation, subsea wellhead or
pipeline;
3. The internal emergency plan shall be 3. The internal emergency plan shall be
prepared in accordance with the provisions prepared in accordance with the provisions
of Annex V, and updated in line with any of Annex V, and updated in line with any
change to the major hazard risk change to the major hazard risk
assessment in the well plan or Major assessment in the well plan or Major
Hazards Report as appropriate. Any such Hazards Report as appropriate. Any such
updates shall be advised to the authority
Material updates shall be advised to the
responsible for preparing the external authority responsible for preparing the
emergency response plans for the area external emergency response plans for the
concerned.
area concerned.
Justification
OGP generally supports the requirements for internal emergency response plans outlined
in Art. 29. However this article is not in line with the requirements of some existing
Regulations at Member State level.
Ad 29.1.:
OGP believes that the article needs clarification with regard to what is meant by
‟incipient major accidents‟, and has suggested the text from Art 2.11.
Ad 29.3.:
OGP does not believe that all updates of internal plans need to be reflected in updates
to the external emergency plans.
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Article 30
External emergency response plans and emergency preparedness
Text proposed by the Commission
OGP proposed amendment
2. External emergency response plans shall 2. External emergency response plans shall
be prepared with the cooperation of be prepared with the cooperation of
relevant operators and, as appropriate, relevant operators and, as appropriate,
licensees, and aligned with the internal licensees
. , and aligned with the internal
emergency response plans of the emergency response plans of the
installations stationed or planned in the installations stationed or planned in the
subject area. Any update to the internal subject area. Any update to the internal
plans advised by an operator should be plans advised by an operator should be
taken into account.
taken into account.
6. Member States shall keep updated 6. Member States shall
ensure they have
records of emergency response resources
sufficient keep updated records of
available in their territory or jurisdiction by emergency response resources available in
both public and private entities. Those their territory or jurisdiction by both public
records shall be made available to the and private entities.
Information Those
other Member States and, on a reciprocal records shall be made available to the
basis, with neighbouring third countries, other Member States and, on a reciprocal
and to the Commission.
basis, with neighbouring third countries,
and to the Commission.
7. Member States and the operators shall 7. Member States and the operators shall
regularly test their preparedness to regularly
periodically
test
their
respond effectively to offshore oil and gas preparedness to respond effectively to
accidents.
offshore oil and gas accidents.
Justification
External plans are generally in place in the North Sea. The proposed Regulation seeks to
mandate „external emergency response‟ plans, which are defined as a local, national or
regional strategy to „limit consequences‟ of an accident related to offshore oil and gas
operations.
Elements of the proposed Regulation (contingency planning, transboundary response
and the need for the cooperation of states) are already described in the Emergency and
Mediterranean Offshore Protocols of the Barcelona Convention. Further requirements on
spill response preparedness are also given in the 1990 OPRC convention, which has a
section relating to offshore facilities.
Ad 30.2.:
OGP believes that the external emergency plan should be based on the potential worst-
case scenario arising from the installation to which it relates, and this needs to be taken
into account in the internal plans of adjacent installations rather than trying to cover all
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installations within a given area. The upstream industry questions how this article would
be complied with if there are many installations referenced within the external plan.
External plans need only take into account the generic content of the installation plans –
not the detail. Internal plans need to align with the external plan, not the other way
round.
Ad 30.6. and 30.7.:
OGP considers that it is impractical for full details of emergency response resources to
be maintained at a Member State level, due to the wide variety of resources available
and the changing nature of what will be available at any time. Some of this information
may also be proprietary and have a commercial value to the owner.
Article 31
Emergency response
Text proposed by the Commission
OGP proposed amendment
2. In the event of an accident, the relevant 2. In the event of an accident, the relevant
authorities, in cooperation with operators authorities
operators in cooperation with
concerned, shall take all measures operators
relevant
authorities
necessary to prevent escalation of the concerned, shall take all
the measures
accident and to mitigate its consequences. necessary to prevent escalation of the
accident and to mitigate its consequences.
4. In the course of the emergency 4. In the course of the emergency
response, the Member State shall collect response, the Member State shall collect
the information necessary for a full
ensure that the information necessary for
analysis of the accident.
a full analysis of the accident
is collected.
Justification
Ad 32.2. and 32.4.:
OGP believes the primary responsibility for taking measures to prevent escalation of an
accident lies with the operator in conjunction with the relevant authorities of the
Member States. Current national legislation defines satisfactorily the operators‟
responsibilities, which should not increase.
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Attachment 6 – Public Participation
Article 5
Public participation in licensing procedures authorisation procedures
Text proposed by the Commission
OGP proposed amendment
1. Member States shall ensure that the 1. Member States shall ensure that the
public shall be given early and effective public shall be given early and effective
opportunities to participate in procedures opportunities
to
participate
in
concerning licensing procedures in their
authorisation procedures
for offshore
jurisdiction in accordance with the
oil and gas activities concerning
requirements of Annex I to this Regulation. licensing procedures in their jurisdiction in
The procedures shall be those laid down in accordance with the requirements of
Annex II of Directive 2003/35/EC.
Annex I to this Regulation. The procedures
shall be those laid down in Annex II of
Directive 2003/35/EC.
2. The Member States may lay down more 2. The Member States
shall identify
detailed arrangements for informing the
those
authorisation
procedures
public and for consulting the public
refered to in paragraph 1 where the
concerned.
public shall be consulted and may lay
down more detailed arrangements for
informing the public and for consulting the
public concerned.
3. Public participation shall be organised so 3. Public participation shall be organised so
as to ensure that disclosure of information as to ensure that disclosure of information
and involvement of the public shall not and involvement of the public shall not
pose risks to safety and security of pose risks to safety and security of
offshore oil an gas installations and theier offshore oil an gas installations and their
operation.
operation
as well as the need to
respect confidential, commercially
sensitive and proprietary information.
Justification
Activities in a petroleum basin are many and varied and likewise the need for
authorisations. Public participation is important and should be supported, but needs to
be appropriate to the circumstances of each Member State and of the activity involved
while at the same time respecting confidential, strategic and proprietary information
including on the geological potential of an area.
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Article 23
Transparency
Text proposed by the Commission
OGP proposed amendment
1. The information pursuant Annex VI shall 1.
Member States or their competent
be made publicly available without a need
authorities The information pursuant
for request pursuant to applicable Annex VI shall
make be made publicly
provisions of Union legislation on access to available
the information pursuant to
environmental information.
Annex VI without a need for request
pursuant to applicable provisions of Union
legislation on access to environmental
information.
3. When publishing their national 3.
When
publishing
information
emergency response plans pursuant to
pursuant to Annexes I, V and VI their
Article 30 the Member States shall ensure national emergency response plans
that disclosed information does not pose pursuant to Article 30 the Member States
risks to safety and security of offshore oil shall ensure that disclosed information
and gas installations and their operation.
does not pose risks to safety and security
of offshore oil and gas installations and
their operation.
Justification
It is important to clarify the responsibility for making information available to the public.
As Member States are recipients of information from the upstream industry, it is
incumbent upon them, notably under Article 24, to publish it.
When publishing data it is important that this does not pose a risk to the safety and
security of oil and gas installations.
Article 24
Reporting on safety and environmental impact of offshore oil and gas
activities
Text proposed by the Commission
OGP proposed amendment
1. The Member States shall prepare an 1. The Member States shall prepare an
annual report concerning:
annual report concerning:
(e) the safety and environmental (e) the safety and environmental
performance of offshore oil and gas performance of offshore oil and gas
operations in their jurisdiction.
operations
and, consequently, the
pertinence of any suspension of such
operations
that
might
be
of
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application in their jurisdiction.
Justification
Member States with oil and gas activities have in place a number of reporting
mechanisms in respect of safety and environmental performance of the upstream
industry. Where Member States enforce suspension of oil and gas operations these
should be reported and duly justified on the basis of European or national legislation.
Article 25
Investigation following a major accident
Text proposed by the Commission
OGP proposed amendment
2. Member States shall conduct thorough 2. Member States
or competent
investigations of major accidents involving
authorities shall conduct thorough
significant damage (to persons and investigations of major accidents. involving
environment) or involving major loss of significant damage (to persons and
assets. The report of the investigation shall environment) or involving major loss of
include
an assessment of the effectiveness assets The
results report of the
of the competent authority's regulation of investigations
and the lessons to be
the installation concerned in the time
learned shall include an assessment of
preceding
the
accident
and the effectiveness of the competent
recommendations for adequate changes to authority's regulation of the installation
the relevant regulatory practices where concerned in the time preceding the
needed.
accident
and
recommendations
for
adequate changes to the relevant
regulatory practices where needed.
be
made promptly available to all
relevant parties.
A specific version of
the report, that takes into account
possible legal limitations, shall be
made available publicly with regard
to Articles 22 and 23.
3. A summary of the investigation report 3. A summary of the investigation report
prepared pursuant to paragraph 2 of this prepared pursuant to paragraph 2 of this
Article shall be made available to the Article shall be made available to the
Commission at the conclusion of the Commission at the conclusion of the
investigation or at the conclusion of legal investigation or at the conclusion of legal
proceedings, whichever is the later. A proceedings, whichever is the later. A
specific version of the report, that takes specific version of the report, that takes
into account possible legal limitations, shall into account possible legal limitations, shall
be made available publicly with regard to be made available publicly with regard to
Articles 22 and 23.
Articles 22 and 23.
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4. Following its investigations pursuant to
3. Following its investigations pursuant to
paragraph 2, the competent authority shall paragraph 2, the competent authority shall
implement any recommendations of the implement any recommendations of the
investigation that are within its powers to investigation that are within its powers to
act.
act.
Justification
In the experience of the upstream industry, the primary requirement from a major
incident enquiry is to quickly and effectively communicate the key lessons learned.
International and national associations are progressing this issue through specialist
expert committees, such as the OGP Wells Expert Committee and Oil & Gas UK‟s Well
Life Cycle Practices Forum. The initiative for reviewing the effectiveness of offshore
safety and environmental legislation should remain with Members States and their
competent authorities.
Article 26 Confidentiality
Text proposed by the Commission
OGP proposed amendment
3. Pursuant to paragraph 2, or for the 3. Pursuant to paragraph 2, or for the
purposes of public participation pursuant purposes of public participation pursuant
to Article 5, the operator shall supply to to Article 5, the operator shall supply to
the competent authority, and make the competent authority and make
available to the public, a version of the available to the public, a version of the
document that excludes confidential document that excludes confidential
information.
information
.
Justification
For consistency reasons, the responsibility to publicly disclose information should reside
with Member States and competent authorities. Disclosure of information by Member
States or their competent authorities should be subject to compliance with other laws
including competition and data protection requirements, and to any applicable rules of
legal privilege.
Particular assurances are needed that the exemptions provided by Directive 2003/4/EC
(Art. 4.2) give proper protection to the confidentiality of commercially sensitive
information, for example those provided in Annex 2.4 (Notification of Well Operations),
that calls for inclusion of inter alia the well work program (item 4), details of well design
(item 7) and the design of well configuration at end of operations (item 8), would also
mean releasing primary and secondary drilling targets. The security of such information
is particularly important in the case of exploration wells.
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Annex I: Public participation linked to authorisations under Directive
94/22/EC
Text proposed by the Commission
OGP proposed amendment
ANNEX I
ANNEX I
Public
participation
linked
to Public
participation
linked
to
authorizations
under
Directive authorisations
under
Directive
94/22/EC
94/22/EC
1.Member States shall ensure that:
1.
For the authorisations defined
pursuant to Article 5.2 Member States
shall ensure that:
(a) the public is informed, whether by (a) the public is informed, whether by
public notices or other appropriate means
public notices or other appropriate means
such as electronic media where available, such as electronic media where available,
about submission of licensing applications about
application for authorisations
to Member States, and that relevant submission of licensing applications to
information about such proposals is made Member States, and that relevant
available to the public including inter alia information about such proposals is made
information about the right to participate, available to the public including inter alia
and to whom comments or questions may information about the right to participate,
be submitted;
and to whom comments or questions may
be submitted;
(b) the public is entitled to express (b) the public is entitled to express
comments and opinions when all options comments and opinions when all options
are open before decisions on the licensing are open
according to timelines and
applications are made;
procedures defined by Member States
or competent authorities and before
decisions on the licensing applications
authorisations are made
granted;
(c) in making those decisions, due account (c) in making
granting those decisions
shall be taken of the results of the public
authorisations, due account shall be
participation;
taken of the results of the public
participation;
Justification
Activities in a petroleum basin are many and varied and likewise the need for
authorisations. Public participation is important and should be supported, but needs to
be appropriate to the circumstances of each Member State and of the activity involved
while at the same time respecting confidential, strategic and proprietary information
including on the geological potential of an area.
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Attachment 7 – Delegated Acts
Article 34
Delegated powers of the Commission Monitoring and review
Text proposed by the Commission
OGP proposed amendment
1. The Commission shall be empowered to 1.
Competent
authorities
shall
adopt delegated acts in accordance with
monitor and seek to continuously
Article 35 of this Regulation to adapt the
improve the safety of offshore oil and
requirements to the latest development of
gas activities under this Regulation,
relevant technologies and procedures in
taking into account the latest
Annex I-VI.
development of relevant technologies
and procedures in Annex I-VI. The
Commission shall be empowered to adopt
delegated acts in accordance with Article
35 of this Regulation to adapt the
requirements to the latest development of
relevant technologies and procedures in
Annex I-VI.
2. The Commission may also adopt
2. The
No later than [3] years
delegated acts in accordance with Article
following
the
completion
of
35 of this Regulation to precise application
transitional periods as defined by
of the requirements of Regulation in
Article 38, the Commission
may
, duly
relation to:
accounting for the efforts and
experiences of competent authorities
in accordance with paragraph 1,
assess in a report the experience of
the implementation of this Regulation
and
propose
any
appropriate
amendments to this Regulation by
way of ordinary legislative procedure.
also adopt delegated acts in accordance
with Article 35 of this Regulation to precise
application of the requirements of
Regulation in relation to:
(a) details to be submitted in a Design (a) details to be submitted in a Design
notificaton or a Major Hazard Report as notificaton or a Major Hazard Report as
specified in Annex II points 1, 2, 3, 6; specified in Annex II points 1, 2, 3, 6;
(b) notification of well/ combined (b) notification of well/ combined
operations as specified in Annex II, point 4 operations as specified in Annex II, point 4
and 7;
and 7;
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(c) requirements related to verification by (c) requirements related to verification by
independent third party verification as independent third party verification as
specified in Annex II, point 5 (d) specified in Annex II, point 5 (d)
requirements
for
functioning
and requirements
for
functioning
and
organisation of competent authorities as organisation of competent authorities as
specified in Annex III and;
specified in Annex III and;
(d) requirements related to the prevention (d) requirements related to the prevention
of major hazards by operators as specified of major hazards by operators as specified
in Annex IV.
in Annex IV.
Justification
The competent authorities, which successfully promote continued improving and
learning, are best-placed and qualified to assess the effectiveness of this Regulation.
The Commission has an important role in receiving information from all Member States
and competent authorities and can then assess the need for further changes to the
Regulation. OGP believes that the ordinary legislative procedure allows for full
engagement of all stakeholders.
Article 35
Exercise of the delegation
Text proposed by the Commission
OGP proposed amendment
1. The power to adopt delegated acts is Deleted.
conferred on the Commission subject to
the conditions laid down in this Article.
2. The delegation of power referred to in
Article 34 shall be conferred on the
Commission for an indeterminate period of
time from the date of the entry of this
Regulation into force.
3. The delegation of power referred to in
Article 34 may be revoked at any time by
the European Parliament or by the Council.
A decision of revocation shall put an end to
the delegation of the power specified in
that decision. It shall take effect the day
following the publication of the decision in
the Official Journal of the European Union
or at a later date specified therein. It shall
not affect the validity of any delegated
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acts already in force.
4. As soon as it adopts a delegated act,
the Commission shall notify simultaneously
the European Parliament and to the
Council.
5. A delegated act adopted pursuant to
Article 34 shall enter into force only if no
objection has been expressed either by the
European Parliament or the Council within
a period of 2 months of notification of that
act to the European Parliament and the
Council or if, before the expiry of that
period, the European Parliament and the
Council
have
both
informed
the
Commission that they will not object. That
period shall be extended by 2 months at
the initiative of the European Parliament or
the Council.
Justification
Deletion justified by amendments to Article 34.
Article 36
Committee procedure
Text proposed by the Commission
OGP proposed amendment
1. The Commission shall be assisted by a Deleted.
committee. The committee shall be a
committee within the meaning of
Regulation (EU) No 182/2011.
2. Where reference is made to this
paragraph, Article 5 of Regulation (EU) No
182/2011 shall apply.
Justification
Deletion justified by amendments to Article 34.
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Attachment 8 – Transboundary Effects
Article 18
Major accident prevention by operators
Text proposed by the Commission
OGP proposed amendment
6. Licensees, operators and major 6. Licensees, operators and major
contractors based in the Union shall contractors based in the Union shall,
with
endeavour to conduct their offshore oil and
Member
States
and
competent
gas operations when outside the Union in
authorities, contribute to sharing the
accordance with the principles set out in
principles in this Regulation for
this Regulation.
offshore oil and gas operations
outside the Union. endeavour to conduct
their offshore oil and gas operations when
in accordance with the principles set out in
this Regulation.
Justification
OGP acknowledges the significance of high operating standards, whether in the EU or
beyond. The effort rests not only with licensees, operators and major contractors, but to
be wholly effective should include Member States and their competent authorities and
the relevant authorities of the countries concerned. The term „endeavour‟ has uncertain
legal effect and should be removed. Article 18.6 in current wording establishes an
obligation difficult to enforce.
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