The other important part of the paper is that it tries to “lift the curtain” on how the BSEE is going to enforce SEMS. Some of the points raised are:

• Between the summer of 2010 and November of 2011, the agency hired 37 new inspectors and committed to hiring nine more by the beginning of 2012.  According to DiGiglia, that is an increase in the inspections corps by about 80%.
• The agency is keeping very quiet about timetables for conducting audits, how many Operators may not have SEMS plans, or whether any action has been taken.   However, the paper says that BSEE has performed one audit off the coast of California and that it is possible that one Gulf of Mexico Operator may have had 15 platforms audited. No information is available on the results of any of these audits.
• The paper says that BSEE is going through a learning curve.  The traditional BSEE inspector was trained to be a generalist who could board a platform and cover a broad range of regulatory compliance areas. That doesn’t work as well with SEMS and the agency is trying to provide the auditors with specialized training in different elements of SEMS.
• The paper hints that revisions to the SEMS regulations may be published within the next two months. It is not known how long the industry will have to implement any changes that come out of the new “Son of SEMS” rules.

Hopefully, BSEE will soon start making some of this information more widely known so that the industry can take a lessons learned approach to improvements in SEMS plans.

For additional information contact Ken Wells at ken@PECSafety.com.

Click here to view the article (you will need Adobe Flash Player to view it). The article starts on page 20.

Thanks for reading. Let us know your thoughts in the comments.

BSEE requests budget increase
The Obama administration has requested $222.2 million,
a 13% increase from the prior year, in its 2013 budget to shore up
offshore safety and training efforts at Bureau of Safety and Environmental Enforcement.

The article explains that the increase includes:

• $14.7 million for the agency’s permit-processing and inspections program.
• $3.7 million for the National Offshore Training and Learning Center, devoted to establishing and teaching safety curricula.
•  A $4.2 million increase for environmental enforcement that will be used to “hire, train, equip and support personnel to conduct environmental inspections, SEMS audits and other activities.”

A closer look at the funding picture can be found here on the BSEE website.

There is also some information on the budget request for the  Bureau of Ocean Energy Management (BOEM), which handles the permitting of offshore projects.   Its request can be found here and it indicates the agency wants a more modest two percent increase over this year’s budget.

Three  points jump out.  First, this is only the budget request.  There will be a huge fight in Congress over the budgets for every agency and you would have to wonder if any budgets get passed in an election year.   Even if approved, these funds would not be available until fiscal year 2013, which starts next October (Just in time for election day in November!)

Second, this is one more indication that the agency knows it has a long way to go before it is fully ready to enforce SEMS.  A 13% increase is a whacking big increase, especially at a time when other government programs are being cut back.   It is probably realistic, given the agencies efforts to staff up and educate new inspectors.

The final point is the difference in budget requests for the two sister agencies.  BOEM, which handles permitting, has suffered from a lack of resources and that is one reason that permitting has been slowed.  BSEE, which handles inspections and enforcement, has suffered from a lack of resources and needs to increase expertise.   The industry has generally supported additional funding for both BSEE and BOEM because it wants to avoid permitting delays on the one hand and wants expertise in inspectors.  However, the uneven funding request (a 2% increase for permitting vs. a 13% increase for enforcement) may raise a few eyebrows.

For additional information contact Ken Wells at ken@pecpremier.com

Hi Ken,

This is a grave concern to us. We are currently sorting contractor verification requirements based on the MOA and the Lead agency determinations. We need to understand if we have a good argument for BSEE or do we need regroup.

This raises a very good question and, like so many good questions, it doesn’t have an easy answer.   The SEMS regulations state explicitly that “Nothing in this  subpart affects safety  or other matters under the jurisdiction of the Coast Guard.”   However, what does that mean?   Clearly it means BSEE won’t tell the Coast Guard how to do its job.  But that does not necessarily mean that vessel owners are off the hook for a couple of reasons –

1.  BSEE may still require Operators to evaluate vessels on  safety-related procedures, safe work practices, training and Mechanical Integrity  under their SEMS plans, even though these are  under the Coast Guard authority.   How can this be?  Well, BSEE (in its previous incarnation as MMS) has a long history of blurring the lines between the agencies.  Just last month, BSEE and BOEM released JOINT NTL No. 2012-G01, telling vessel crews how to avoid hitting marine mammals.   The industry agrees on the importance of avoiding collisions with marine mammals, but what could be more clearly a matter of Coast Guard authority than vessel collisions?  Yet BSEE appears to be taking the lead on this issue. 

   The SEMS rule itself is a little vague on when a vessel falls under BSEE’s direct authority.   There are times when a vessel is considered a facility under SEMS and that opens the vessel to all of the facility requirements including hazard analysis and documentation that goes back to their design and construction.   Does this mean BSEE will develop the expertise to regulate vessels?  We can assume the answer is no.  But the agency may be saying that, if the Operator has a SEMS plan, it must evaluate vessels and their crews to make sure they comply with the SEMS plan and with other agencies’ regulations.   This is very similar to what was done with the EPA’s vessel discharge permits.  Most of the items covered by the permits are within the Coast Guard’s authority; the EPA permit requires compliance with the Coast Guard.
    

2. The Operators themselves may require certain things of vessel owners simply because of the nature of Safety Management Systems.   They are looking for a consistent safety management system across all of their contractors/vendors stretching back to their manufacturers and trucking firms.     This is in keeping with the concept of safety management, but it raises some pretty significant questions about how BSEE will enforce the regulations.   The idea of BSEE asking whether a trucking firm has a Management of Change policy when it changes truck models is a little frightening. 

   Some of these areas are going to be messy.  Crane safety is an example.   Part of the answer on crane safety takes place on the facility, whether it is a platform or a MODU.  Part of the answer is on the boat.  Further confusing the issue, for many unmanned facilities, the crane is on the boat itself.   How do you sort that out?    API RP 75 says definitively that crane operations must be part of safe work practices and evaluated by the Operator.

So how to deal with all this?   For many vessel companies it is a matter of making sure their International Safety Management plans map over to the Customer’s SEMS.   We have worked with a number of boat owners to help them show how the elements of their ISM plans meet the requirements of the customer’s SEMS plan.   In most cases it is a very clear match, especially since the ISM plans are audited by third party auditors already.   

That said, BSEE’s statements that vessels are facilities during certain types of activities opens a new can of worms, especially since the newest generation of vessels are designed to perform well work that previously required a MODU.   It is an area where the industry really needs the Coast Guard and BSEE to add clarity.

PEC Premier Adds SEMS Awareness to SafeGulf Training

SEMS awareness training is now available as a part of the SafeGulf offshore safety orientation program. On January 1^st, PEC Premier added a Safety and Environmental Management System module to its one-day Basic Safety Orientation and its three-day Core safety training course, meaning that both will now meet the new requirements for SafeGulf. The company is also offering stand-alone SEMS training for offshore workers who already have their SafeGulf cards.

The U.S. government is now requiring oil and gas companies to implement SEMS plans for their offshore facilities. As a part of that requirement, contractor personnel who work offshore must have basic safety training before they go to work offshore. Most oil and gas companies require or recommend that contractors meet that by putting their employees through SafeGulf orientation. Earlier this fall, the governing board for SafeGulf added SEMS training as a new element of SafeGulf. That means that workers who go through SafeGulf for the first time must be taught about SEMS as a part of that training.

In order to meet the new SafeGulf requirement, PEC/Premier has updated both its one-day Basic Safety Orientation course and three-day Core Compliance course to include the necessary SEMS topics. This will allow new students to take either Basic or Core and receive their PEC SafeGulf card with a SEMS endorsement.

PEC Premier offers its training through a unique network of more than 1,000 approved instructors located all over the United States. The PEC Premier system ensures that those instructors are qualified to teach by making sure they have the necessary background, have gone through a train-the-trainer course and are routinely audited, all of which fit the SEMS requirement that instructors be qualified to teach required courses.

Additionally, many companies are looking for ways to provide SEMS training to their existing employees who have already taken SafeGulf. To fill that need, PEC Premier has partnered with Moxie Media to develop a training module that focuses on SEMS. This training is available as either on-line Computer-Based Training (CBT) or as a DVD with a special test option to ensure that the training can be verified and audited if necessary. This program has rapidly become the most-used industry SEMS training, in part because PEC is able to link SEMS training with PEC SafeGulf records, allowing personnel who have already gone through PEC SafeGulf to receive the SEMS training without repeating the full SafeGulf training.

For assistance in finding an approved Basic or Core instructor or to order the SEMS training CBT or DVD, please contact PEC Premier’s customer support center at 800.892.8179 or by email at safety@pecpremier.com.

If you have any questions at all please feel free to leave them in the comments or contact us directly at 1.800.892.8179.

SWA has been so effective that the proposed changes to the SEMS rule include requirements for Stop Work Authority:

Your SEMS program must include SWA procedures that authorize and make responsible any and all employees and other personnel (including contractors) who perform activities on the OCS that are regulated under BOEMRE jurisdiction and witness an activity that creates an imminent risk or danger to the health or safety of an individual,  the public, or to the environment to immediately stop the work that is creating the risk or danger. In this section, imminent risk or danger means any conditions activities or practices in the workplace that could reasonably be expected to cause:

(1) Death or serious physical harm immediately or before the risk or danger can be eliminated through enforcement procedures; or

(2) Significant, imminent harm to land, air, aquatic, marine or subsea environments or resources.

(b) The person in charge of a specific activity is responsible for ensuring the work is stopped in an orderly and safe manner. Individuals who receive a notification to stop work must comply with that direction immediately.

(c) Work may be resumed upon a determination by the person on the facility with ultimate work authority that the imminent risk or danger that led to the stoppage does not exist or no longer exists. The decision to resume activities must be documented in writing as soon as practicable.

(d) You must include SWA authority and expectations as a standard line item in all JSA drills.

(e) You must conduct training on your SWA Policy and Program as part of all new  employee and contractor orientations that perform activities on the OCS that are regulated under BOEMRE jurisdiction. Additionally, a review of the SWA Policy must be completed as part of all safety meetings.

So it is worth asking how effective SWA is and how well it has filtered throughout the industry.   A few of the answers may be found in some interesting research done at Nicholls State University in Louisiana.  The research project was led by Michael Gautreaux, M.S., CSP, who is a professor in the Department of Applied Sciences at the school.  He and his team surveyed the industry on perceptions of SWA and he presented preliminary findings at this years’ Deepwater Technical Symposium.

First the good news from the study – After surveying managers, supervisors, HSE professionals and employees and making sure there was a good mix  from the drilling, production and service sectors, the researchers found general agreement that:

1. Company SWA programs are effective
2. The company culture supports the use of SWA
3. The decision to stop work will be supported, even if it turns out to have been unnecessary.

However, there are some pretty interesting differences among the different groups:

1. Generally managers think the program is a lot more effective and that it has more success than their supervisors, employees or HSE professionals.
2. Supervisors are a lot less likely to believe that the company encourages workers to use SWA than the managers.
3. HSE professionals are less likely to believe that the oil and gas industry as a whole supports SWA
4. Employees are less likely to believe they have adequate training on SWA than the HSE professionals (who theoretically provide the training).

What does it all mean?  Overall it is a positive sign that SWA is being used and is effective.   In most cases the differences in perceptions between the groups are not a cause for concern.   The results are preliminary and Professor Gautreaux and his team will continue to refine their research.

For companies, the study is a good reminder that a successful SWA program requires continually training personnel on the process and really driving home the message that the company will back up employees who stop the job.  SWA only works if employees know that they have a responsibility for ensuring safety and that the company supports them.

The industry has been waiting with bated breath for the SEMS PINC list because it clarifies what the agency will focus on when enforcing SEMS.  At the very least,  it helps lease-holders fine-tune their SEMS plans.  This particular PINC list is extensive – more than 20 pages long.  The list goes through each of the 13 elements of SEMS and highlights the specific parts that BSEE personnel should ask to see.   To no one’s surprise, the PINC list focuses on documenting and verifying procedures.  For example, under the section covering contractor safety, the list says personnel should:

Verify that when selecting contractors, operators should obtain and evaluate information regarding a

contractor’s safety and environmental management policies, practices, and past performance along with their

procedures for selecting sub-contractors.

In other words, the agency is saying to operators, “Show us the process you use to decide if a contractor is safe.”   Other parts require the operators to share their SEMS expectations with contractors and that the two sides agree on the safety approach to be used on the facility.

As if anyone needed reminding, the PINC list shows how much is riding on SEMS compliance.   Incidents of Noncompliance carry a potential fine of $35,000 per day.  The list also helps clarify when an infraction could result in a shutdown of the facility.    For most items on the list, failure to comply results in a warning INC.  However, failure to have a SEMS plan or allowing an unsafe condition to exist that could threaten the facility and everyone on board could result in an order to shut down the entire facility until the problem is fixed.  In cases where a particular piece of equipment presents a hazard or personnel working on that equipment are not properly trained, that problem could result in an order to shut down that specific piece of equipment.

On December First, he gets his wish. The new director will be Coast Guard Rear Admiral James A. Watson IV. By all accounts this is a good move for the agency and for the offshore industry. Director Bromwich came in at a low point, as oil was flowing into the Gulf of Mexico and both the agency and the industry were coming in for fierce criticism. He made it clear that he was going to be an enforcer. The New York Times article that announced Bromwich’s appointment quoted President Obama in no uncertain terms: “His charge over the next few months is to build an organization that acts as the oil industry’s watchdog — not its partner.”

Bromwich took that role seriously and had an at-times contentious relationship with industry and members of Congress,  but it has to be said that he did steer the agency through a period of rapid and extreme change.

But now it is time to chart a new course. Strained relations between Americans who work for a given industry and the government agencies that regulate them only go so far, especially when it comes to safety and protecting the environment. The Safety and Environmental Management Systems (SEMS) rules that went into effect this week are a perfect example. Safety management approaches don’t work unless there is an atmosphere of cooperation and trust. Safety management is about committed companies who are constantly seeking ways to improve their safety and environmental policies. Mistrust between industry and agencies only tends to drive unsafe policies underground where they are hard to identify and fix. While some may argue that the agency’s approach to offshore activities may have been warranted given in the months following Macondo, it is not the best way to approach the future.

That’s where Admiral Watson may be the perfect person for the job. He was the Federal On-Scene Coordinator for the entire government response to the Macondo incident. He has a very good reputation as a problem-solver, who listens to all sides and makes up his own mind. As the saying goes, “he can disagree without being disagreeable.” He should be able to help BSEE to be the watchdog over offshore energy while still keeping an open dialogue with industry. His approach is also well-suited to restore morale to the staff at BSEE, which has taken a beating over the last year.

On a final note, isn’t it interesting that when U.S. Presidents need someone to take on a tough job in government, they increasingly turn to the U.S. Coast Guard? From President Bush putting Admiral Thad Allen in charge of the Hurricane Katrina response and Rear Admiral Larry Hereth in charge of the Hurricane Rita response. The Coast Guard was given the lead on Macondo and a main role in responding to recent international disasters like the Haiti earthquakes. There is a reason for this, Coast Guard officers have a reputation as problem-solvers, who focus on solutions rather than finger-pointing. The dramatic improvement in maritime safety and the decline in maritime vessel pollution over the past 20 years is evidence of the Coast Guard’s effectiveness in working with industry toward common goals while still maintaining its enforcement authority.

Good luck to Admiral Watson and welcome.

Well, the deadline is here. The question is, what happens next? A good article by Hearst Newspaper reporter  Jennifer A. Dlouhy looks at the implementation of SEMS (and quotes PEC on the contractor reaction).  She spoke to officials at the Bureau of Safety and Environmental Enforcement (BSEE) and they said the agency intends to hit the ground running:

The Interior Department’s Bureau of Safety and Environmental Enforcement could launch audits immediately, and spokesman David Smith said Monday they will begin soon. He emphasized that the audits are distinct from other regulatory procedures such as reviews of exploration plans or drilling permit applications.

“At the outset, we do not plan to publish the results of individual SEMS audits but instead to report results in the aggregate so that operators can learn about the areas in which we are most commonly finding problems and deficiencies,” Smith said.

Industry leaders say they are hoping for a transition period, during which federal regulators notify companies of violations but delay possible fines or other penalties.

The Director of BSEE, Michael Bromwich has said that the agency will begin enforcement in November and that the agency wants to use teams of investigators to review an operator’s SEMS plan. However, the agency has not really indicated whether it has the staff and experience to fully implement that approach. One way that the agency could begin enforcing the regulations is to do its traditional inspections and ask SEMS-related questions as a part of that function. It remains to the seen.

In the meantime, the comment period just closed on a proposal from BSEE to revise SEMS and add some new requirements. The agency received about 25 different comments and they contained some thoughtful recommendations for improving SEMS. Hopefully the agency will take these comments under consideration before the final rule is published. It is anyone’s guess when the rule will be finalized. Generally, it takes 3-6 months for a regulation to get through the internal government process. It would be good if the agency would also give industry another grace period to implement the changes. All that suggests that the new rules won’t be in place before next summer or fall. To review the proposed SEMS revisions and the public comments, go to Regulations.gov and type in the Docket ID: BOEM-2011-0003.

The industry is putting the finishing touches on plans now. Here is what PEC Premier is doing (from a news release published today):

Final Countdown to SEMS – Update on PEC Premier Services

Mandeville, LA (PRWEB) November 09, 2011
The federal deadline for offshore oil and gas companies to implement Safety and Environmental Management System (SEMS) plans is just one week away. To help the industry address the new rigorous safety deadlines, PEC Premier is offering a range of services.

PEC provides contractor safety evaluation to some thirty offshore companies, including twenty that have signed on with PEC in just the last year. In order to meet this customer demand, PEC has made improvements to its online database system, making the system significantly faster, more user friendly and focused on putting the right safety information at the fingertips of its customers.

“The SEMS regulations are a significant new set of new rules that face the offshore oil and gas industry,” said PEC Premier President Wes Carr, “the operators and contractors we work with are pushing as hard as they can to meet this deadline and implement effective safety improvements. We want to make sure we are doing our part to help the industry comply.”

For operators, PEC has redeveloped its online standardized safety questionnaire and training tracker to provide the tools they need to evaluate their contractors safety and training programs. Additionally, PEC offers the following services to help contractors meet the SEMS needs of the oil and gas operators:

• SEMS training for offshore oilfield workers – Working in partnership with Moxie Media, PEC Premier has developed awareness-level training in SEMS for contractor personnel who work offshore. This training is based on recommendations from industry working groups that urged SEMS training for personnel and it follows the SafeGulf curriculum for SEMS training. It is available in either DVD or online computer based training formats.
• SafeGulf training – PEC trains outside instructors to teach the one-day Basic and three-day Core safety training that meets the requirements of SafeGulf. Most offshore oil and gas companies either require or recommend contractor personnel go through SafeGulf before they go offshore.
• Verifications of contractor written safe work practices – SEMS requires that oil and gas companies verify that contractors have written safe work practices. PEC Premier’s desktop verifications help meet this key government requirement.
• SEMS workshops for contractors – Through a structured process, PEC helps contractors understand their customers’ needs under SEMS, including the development of their own safety and environmental management systems plan, if that is a customer requirement.
• PEC Premier Training Tracker – The online Training Tracker, a requirement with some oil and gas companies, allows contractors to upload training records and documentation into the PEC database. This allows them to make this information available for operators when it is needed, without having to devote staff time to continually manage these records internally.

For more information on PEC Premier’s services contact Ken Wells at ken(at)pecpremier(dot)com or (800) 892-8179.