1

National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling

A Competent and Nimble Regulator: 

A New Approach to Risk Assessment and Management

Staff Working Paper No. 21

Staff Working Papers are written by the staff of the National Commission on the 

BP Deepwater Horizon Oil Spill and Offshore Drilling for the use of members of 

the Commission. They do not necessarily reflect the views either of the 

Commission as a whole or of any of its members. In addition, they may be based

in part on confidential interviews with government and non-government 

personnel.

“The industry needs a robust, expertly staffed, and well-funded regulator that can keep 

pace with and augment industry's technical expertise. A competent and nimble 

regulator will be able to establish and enforce the rules of the road to assure safety 

without stifling innovation and commercial success.” 

Testimony of Marvin Odum, President, Shell Oil Company, and Upstream 

Americas Director, Royal Dutch Shell.1

The regulation of the offshore oil and gas industry in the U.S. Gulf of Mexico has not 

been robust, expertly staffed, well funded, competent or nimble. The fatality rate for 

U.S. offshore oil and gas workers has been more than four times higher per hour worked 

than in Europe, according to data collected by industry groups and government 

regulators (see below), despite many of the same companies working in both venues. 

This fatality data suggest that regulators in developed offshore oil and gas producing 

countries – Norway, the United Kingdom, Australia and Canada – regulate for safety 

much more effectively than their US peers. 

The paper examines some shortcomings in the US regulatory approach, particularly its 

failure to embrace a risk-based oversight approach. It presents a case for restructuring 

the Offshore Program, now the Bureau of Ocean Energy Management, Regulation and 

Enforcement (BOEMRE) and creating a separate, independent safety regulator with 

consolidated authority over energy-related operations, structures, and workers. It 

discusses institutions, processes, and resources in the U.S. context for effective risk 

 1 Testimony before the National Commission on BP Deepwater Horizon and Offshore Drilling, November 9, 

2010. 
2

assessment and management of the offshore energy sector, and it examines other 

countries’ regulatory approaches. 

The U.S. Offshore Program: Unclear Purpose, Limited Resources, and Conflicts of 

Interest

The Minerals Management Service (MMS, now BOEMRE) was created by Secretary of 

the Interior James Watt to regulate offshore oil and gas development, and manage

revenue collection from all federal and Indian lands. It was organized with regional 

managers responsible for all aspects of program implementation - leasing, safety, and 

environmental protection – with wide variation in resources and personnel across the 

three regional offices: the Gulf of Mexico, Pacific, and Alaska.2

 

Safety oversight of the offshore oil and gas industry was under a structure where leasing 

and increasing production were most visible and valued at the top of the organization.

Senior managers generally agreed that expanded oil and gas production on the outer 

continental shelf (OCS) was in the national interest, and many saw the safety program 

 2 See “Who is BOEMRE?” http://www.boemre.gov/aboutBOEMRE/
3

as being necessary to protect and expand opportunities for such oil and gas 

development.3

A lull in offshore activity in the early 1990s turned into a boom with the expansion into 

deepwater; in fact a record number of wells were drilled in 1997.4 This acceleration in 

activity dramatically increased the workload for the Offshore Program, in particular in 

the Gulf of Mexico regional office. The new drilling operations tended to be more 

complex and farther from shore, with well production rates orders of magnitude higher 

than were common for the shallow water shelf leases. In the midst of this expansion,

the Offshore Program in 1996 reached the nadir of its resources in terms of total 

budget.

5

 The budget austerity of the 1990s also affected the Coast Guard, leaving MMS 

to fill in the gaps with respect to safety of offshore personnel—an added responsibility 

without additional resources.6

 3 Interview with Bud Danenberger, former Chief Engineer of MMS. 

4 One of the reasons for the dramatic scale-up in drilling was the greater proportion of oil than natural gas in 

deepwater reservoirs, therefore higher profitability even with the higher production costs. Commission staff 

analysis of BOEMRE historical wells-drilled data. 5 Commission staff analysis of MMS yearly budget request and enactments, tracked by nominal and real (2005) 

dollars.

6 Inspection Under, and Enforcement of, Coast Guard Regulations for Fixed Facilities on the Outer Continental 

Shelf by the Minerals Management Service, 67 Fed. Reg. 5912 (February 7, 2002).

0

100

200

300

400

500

600

$-

$50 

$100 

$150 

$200 

$250 

$300 

19841985198619871988198919901991199219931994199519961997199819992000200120022003200420052006200720082009

Barrels of Oil (Millions)

Millions of Real 2005 Dollars

Year

MMS Offshore Program Budget and Gulf of Mexico Oil Production, 1984-2009

Ultra-Deep (5,000+ ft)

Deep (1,000-4,999 ft)

Shallow (0-999 ft)

OEMM Enacted Budget

Source: Commission staff, adapted from DOI and EIA

Note: The budget numbers do not include revenue management or general administration.
4

MMS Actions to Manage Deep Water Expansion

In 1998, MMS implemented a performance management approach for the larger, more 

complex deepwater production systems then being developed by industry. Notice to 

Lessees and Operators (NTL) 98-8N required operators to engage MMS at the 

conceptual stage for a Deep Water Operations Plan (DWOP). A DWOP is required any 

time a non-conventional production technology is to be used, even if the project is in 

shallow water. DWOPs are first submitted at the conceptual stage so that major 

investments are not made before BOEMRE is satisfied with the mitigation of safety and 

environmental risks. If the conceptual plan is approved, a final DWOP covering all 

aspects of the structure, station keeping, riser, subsea components, safety systems, and 

operating procedures must be submitted. Proposed use of any new technology or 

alternative compliance plans must be identified and described.7

As in the regimes of the peer regulators in other countries with similar safety and 

environmental concerns, the intent was to “allow MMS to review a project from a total 

system approach, emphasizing operational safety and environmental protection” to 

demonstrate that the project was being developed in an acceptable manner prior to 

major expenditures for engineering design.8 Given the known risks associated with 

large offshore installations,9

Philosophically, the agency was moving toward a regulatory regime tied more to 

performance and less to prescription. At an international conference of the Society of 

Petroleum Engineers (SPE) in 1998, a senior MMS manager laid out the current thinking 

with regard to regulation, “[B]oth the Marine Board and an internal MMS Inspection 

task force report reinforced the point that operators bear the primary responsibility for 

safety. The Marine Board report noted that the major factors in safety operations are 

(1) management’s safety policy and (2) the attitudes and training of personnel who 

manage and operate the facility.”

the industry embraced the standards for risk assessment 

and failure analysis for these deepwater production facilities by developing an industry 

standard which was referenced in the regulation.

10 This extended to voluntary adoption by industry of 

Safety and Environmental Management Plans rather than being required to do so. 

 7 Scarlett, Lynn, Igor Linkov, and Carolyn Kousky. Discussion Paper, Risk Management Practices, 

Cross-Agency Comparisons with Minerals Management Service, January 2011, RFF DP 10-67. P. 24 8 Notice of revised guidelines for Deepwater Operations Plans 

http://www.gomr.boemre.gov/homepg/whatsnew/newsreal/1998/980617s.html

9 Ten years earlier, a gas leak on Occidental Petroleum’s Piper Alpha platform in the U.K. North Sea caused an 

explosion that killed 167 people. http://home.versatel.nl/the_sims/rig/pipera.htm Arco’s South Pass Block 

60 Platform B had been destroyed by fire and explosion in 1989, killing seven people. 

http://www.gomr.boemre.gov/PDFs/1990/90-0016.pdf. 10 A Performance-Based Approach to Offshore Regulation, C.U. Kallaur, Minerals Management Service, presented 

at the 1998 SPE International Conference on Health, Safety and Environment in Oil and Gas Exploration and 

Production. Caracas, Venezuela, June 7-10, 1998. The Marine Board of the National Academy of Sciences 

report had been in response to a request from MMS in the aftermath of the Piper Alpha and South Pass Block 60 

accidents. 
5

The technical reviews of these complex deepwater systems strained the agency’s

resources since they called for trained engineers and scientists to complete them.

11 To 

manage an expanding workload in an environment of budget austerity, MMS 

announced an increase in the rental rates on deepwater leases that had been issued

under royalty waivers. Rent paid on a lease during the exploration and development 

stage prior to production, was the only significant source of funds beyond 

appropriations available to support the agency’s expanding deepwater oversight 

responsibilities. Industry successfully lobbied its supporters in the Gulf Coast 

Congressional delegations to prevent any increase in these rental rates.

12 

As it introduced the deepwater operations plans, MMS also initiated efforts to modify 

the incident reporting requirements to better assess risks. (As explained below, the sort 

of data on accidents collected by regulators abroad can become the basis for improved 

standards.) Industry opposed such reporting as duplicative of Coast Guard 

requirements. MMS proposed instead a system of voluntary reporting of performance 

measures.

13 

In 2003, after five years of voluntary reporting proved inadequate, MMS proposed a 

new rule to require more detailed incident reporting.14 This new data collection rule 

would have included all unintentional gas releases, a hazard for fires and explosions and 

significant indicator of process safety risks. The Offshore Operators Committee (OOC)15

 11 Reviews of the facilities were a priority given the risk of structural failures, as happened with the BP Thunder 

Horse platform. Structural defects were revealed during a relatively minor hurricane months after deployment 

which then took three years to repair. http://www.rigzone.com/news/article.asp?a_id=36258.

 

vehemently objected, stating that the “proposed rulemaking is very prescriptive, 

complicated and burdensome. Since it is so prescriptive compared to the existing 

performance based regulations, the proposed rulemaking may actually limit the 

reporting of certain incidents and the data received.” The comments again cited 

possible duplication with reporting to the Coast Guard. According to a former head of 

12 In 1998, in the bill funding MMS for fiscal year 1999 the Congress directed MMS “to maintain its current 

financial terms for deepwater leases for the remainder of the incentive period.” (U.S. Congress Conference 

Report, Making Omnibus Consolidated And Emergency Supplemental Appropriations For Fiscal Year 1999, 

Report 105–825, October 19, 1998. P. 1207.) Representative Bob Livingston (R-LA) and Senator Kay Bailey 

Hutchison (R-TX) took the lead on the appropriations riders in their respective chambers. Inside Energy, Oct 5, 

1998. 13 U.S. Minerals Management Service. “NTL No. 98-6N, Performance Measures for OCS Operators and Form MMS131,” Notice to Lessees and Operators (NTLs) of Federal Oil, Gas, and Sulphur Leases in the Outer Continental 

Shelf. April 1, 1998. http://www.boemre.gov/ntls/Attachments/ntl98-6n.htm. The industry in the U.K. had 

formed an organization, Step Change for Safety, the previous year with the explicit purpose of improving 

offshore safety. http://stepchangeinsafety.net/stepchange/About.aspx 14 U.S. Minerals Management Service, “Oil and Gas and Sulphur Operations in the Outer Continental Shelf –

Incident Reporting Requirements,” Federal Register 68, no. 147.44910 (July 8, 2003). 

http://www.boemre.gov/federalregister/PDFs/July8_FR.pdf. 15 The Offshore Operators Committee (OOC) is the lobbying group representing most of the offshore industry 

including BP, Shell, Exxon, and Chevron, as well as a number of smaller operators. Comments filed November 

24, 2003. 
6

MMS in an interview with Commission staff, the MMS held firm, only to be overruled by 

the White House Office of Management and Budget (OMB).16 

The final rule, not issued until 2006 required a gas release be reported to MMS only if it 

resulted in an “equipment or process shut-in” or mechanical closure.17 This was 

significantly less information than the companies had to report to their regulators in 

Norway and the U.K. Not only had the offshore industry long been required to track 

and report in detail on the circumstances of such releases to regulators in the North Sea, 

such information was subject to extensive scrutiny by operators as well as regulators 

(see further discussion below). Duplication with the Coast Guard or not, the reporting 

requirement applied only to accidental releases; without a system failure there would 

be no reporting requirement. During the time it took to complete the narrowed down 

rule, there were 246 fires or explosions, at least 21 with injuries or fatalities. Better 

understanding of the likelihood and circumstances of such unintended gas releases –

precursors to a fire or explosion – might have helped prevent some of these Incidents.

Offshore Statistics for Fires and Explosions (1996-2009)18

Years Fires & 

Explosions

Events 

with

Injuries

Events 

with

Fatalities

1996-‘02 657 47 4

2003-‘05 246 21 1

2006-‘09 506 7 1

From 1996 through 2009, in addition to the fires and explosions shown in the chart 

above, there were 79 losses of well control in the Gulf of Mexico, some of which led to 

an explosion or fire. The Macondo blowout in April 2010 led to both. (Appendix A 

includes a complete listing of the losses of well control in the Gulf of Mexico since 1996.)

A month after the rule was final, the Offshore Operators Committee cited the limited 

voluntary data in comments opposing a requirement that all operators have a 

 16 The decision by OMB to overrule the agency was from an interview with E.P. Danenberger via teleconference, 

September 2, 2010, confirmed via email dated October 25, 2010. The draft proposed rule submitted by MMS to OMB 

would have been a pre-decisional document not available to the public. 17 U.S. Minerals Management Service, “Oil and Gas and Sulphur Operations in the Outer Continental Shelf – Incident 

Reporting Requirements,” Federal Register 71, no. 73.19640 (April 17, 2006). 

http://www.boemre.gov/federalregister/PDFs/AC57-4-17-06.pdf. This was insufficient for the purposes of comparing 

data with regulatory peers, and MMS was not able to participate in this important aspect of the IRF performance 

measures project. (http://www.irfoffshoresafety.com/country/performance/) 18 Based on MMS data received via e-mail on August 31, 2010. Due to changing reporting requirements, various data 

recording methods, and spreadsheet design, it’s challenging to determine the severity of events. Reporting 

requirements for fires changed in 2006, so rates of fires per year are not comparable pre and post 2006. Note: 

numbers do not represent number of injuries or fatalities, but rather number of fires and/or explosions that resulted 

in at least one injury or fatality. For example, the Deepwater Horizon blowout and explosion that killed 11 men is one 

of the two events that resulted in a fatality since 2006.
7

documented safety and environmental management plan: “as demonstrated in the 

MMS performance measures, the rate of incidents has significantly decreased since 

1996 which we believe can be attributed to operators focusing on safety and protecting 

the environment.”19 Having made sure the government did not have access to the best 

and most complete information as to what was going on offshore, the industry group 

then used lack of information to argue that it was getting safer out there. 

By 2003, five years into the new performance based approach to regulating deep water, 

neither the regulator nor the industry were collecting and analyzing the data that other 

safety regulators consider to be the most critical hazard precursor to monitor.20 

The U.S. Record for Offshore Worker Safety

The conventional wisdom is that the safety culture of an offshore operation is affected 

by the tenor set by the senior management of the individual operator as well as the 

regulatory regime. Contractors working on drilling rigs are under constant pressure to 

get the next job. If the regulatory regime does not include rigorous management 

oversight, contract awards may be based as much on willingness to "accommodate" an 

operator as on cost.21 Given that roughly 80% of offshore workers are contractor 

employees, this has serious implications for worker safety. In addition to the reporting 

on hazardous occurrences described above, the statistics for occupational, as opposed 

to system safety, in the U.S. do not compare well to the those of the peer regulators.

Safety regulators in Norway and the U.K. are part of the labor ministries. These 

regulators have consolidated safety responsibility for the offshore workforce engaged in 

oil and gas related activities (see below). In the United States, responsibility for worker 

safety offshore is divided between the Coast Guard and BOEMRE. The Coast Guard has 

responsibility for vessels, including Mobile Offshore Drilling Units (MODUs); the overlaps 

in statutory jurisdiction have been addressed in a series of Memoranda of Agreement 

between the Coast Guard and BOEMRE.22 Neither agency requires drilling rigs or 

MODUs to have a safety management plan. There are also situations where it is not 

clear whether there is any federal agency with oversight responsibility, for example, as 

with helicopters servicing offshore oil and gas facilities.23

 19 The OOC comments also stated that limited resources made it difficult for the agency to oversee such a 

requirement anyway. 

 

20 UK report on hydrocarbon releases. http://www.ptil.no/news/trends-in-risk-level-2009-employees-positive-gasleaks-cause-concern-article6836-79.html 21 Based on staff interviews and conversations with a number of people in industry, international regulators and 

the World Bank. One North Sea regulator told Commission staff that some workers have told him they feel safer 

in the harsh environment of the North Sea than on rigs in the Gulf of Mexico.

22 There are a series of Memoranda of Understanding and Agreement between the two agencies to clarify which 

agency will carry out which responsibilities where they overlap. http://www.boemre.gov/MOU/MOUindex.htm 23 A helicopter crash in 2009 took eight lives without even registering in the MMS statistics because it did not 

occur taking off or landing on a platform. The Sikorsky S-76 C crashed on January 4, 2009 near Morgan City, 

Alabama. This information was obtained from a query of the National Transportation Safety Board database on 
8

The fatality rate for U.S. offshore oil and gas workers has been more than four times 

higher per hour worked than in Europe, according to data collected by industry groups 

and government regulators (see graph below). While the relationship between injury 

rates in U.S. waters as compared to Europe vary widely by data source, a comparison of 

official data filed with the national regulators shows only 34 injuries reported for every 

fatality in U.S. waters, whereas 545 injuries were reported for every fatality in European 

waters.24 The North Sea and Maritime Canada are much harsher offshore environments 

than the Gulf of Mexico, and the presence of organized labor and legal requirements for 

worker safety representatives undoubtedly increase the likelihood of reporting 

compliance. (According to Commission staff interviews with a number of industry 

officials, the U.S. has virtually no organized labor presence in the offshore sector, nor 

are there any provisions of law requiring a worker safety representative on offshore 

facilities.25

However, it seems unlikely that those factors account for such a significant difference. 

Conversations with BOEMRE staff revealed that the operators are responsible for 

reporting injuries and fatalities for themselves and contractors. The agency does not

request any such data from contractors or subcontractors.

) 

 helicopter accidents. http://www.ntsb.gov/ntsb/Response2.asp. Based on various interviews with the 

BOEMRE staff, there appears to be a lack of clarity with regard to responsibility for worker safety offshore, 

including gaps in worker protection. The MMS staff confirmed the agency initiated taking over inspections on 

fixed platforms when it became apparent the Coast Guard was not able to do so. They noted the lack of any 

OSHA presence in the offshore. The Commission staff has not had the time or resources for a complete 

investigation. 

24 Injury statistics are based on standardized reporting metrics for the International Regulators Forum. 25 Based on conversations with a number of industry sources. 
9

Most offshore inspections in the Gulf of Mexico are carried out by one or two people, 

often visiting more than one facility in a day.26 BOEMRE inspection findings are not 

public documents. Further, since the data collection requirements were revised in 

2006, detailed analysis of the incident information has not been published, nor is there 

any formal interaction with the industry on trends in offshore safety.

Strained budgets and lack of backup staff have seriously limited training and 

professional development in recent years. In addition, BOEMRE does not have a 

 26 Based on staff review of inspection records, conversations with BOEMRE staff and nonpublic 

government documents, significantly more resources are apparently available in California relative to the 

number of platforms, including more inspectors, more extensive inspections of each platform, use of 

laptops to track and compare records over time

0

1

2

3

4

5

6

7

8

0

1

2

3

4

5

6

7

8

0

1

2

3

4

5

6

7

8

International Association

of Drilling Contractors,

2004-2009

International Association

of Oil & Gas Producers,

2004-2009

International

Regulators’ Forum,

2007-2009

Fatalities from Offshore Oil and Gas Operations

Fatalities per 100 million manhours

US

Europe

US

North 

America

Europe

Europe*

0

100

200

300

400

500

600

700

800

0

100

200

300

400

500

600

700

800

0

100

200

300

400

500

600

700

800

International Association

of Drilling Contractors,

2004-2009

International Association

of Oil & Gas Producers,

2004-2009

International

Regulators’ Forum,

2007-2009

Injuries from Offshore Oil and Gas Operations

Injuries per 100 million manhours

US

Europe

US

North 

America

Europe

Europe*

Note: Data from the International Association of Oil & Gas Producers includes helicopter-related incidents. Data from the 

International Association of Drilling Contractors and the International Regulators’ Forum include helicopter-related incidents only 

if it is at or near an offshore installation.

*Europe for the International Regulators’ Forum data represents the United Kingdom, Norway, and the Netherlands.

Source: IADC Incident Statistics Program, International Association of Drilling Contractors, http://www.iadc.org/asp.htm; Safety 

performance indicators, International Association of Oil & Gas Producers, http://www.ogp.org.uk/; IRF Country Performance 

Measures, International Regulators’ Forum, http://www.irfoffshoresafety.com/country/performance/.
10

competitive salary scale to recruit and retain licensed and highly skilled non-managerial 

technical staff as its peer regulators do. 

Laxity in regulation and data collection appears to have caused deterioration in the 

safety culture in the Gulf. Max Ruelokke27, the chief regulator in Newfoundland, 

Canada, was blunt in describing the condition of a Transocean rig that returned to 

Canada after a stint in the Gulf of Mexico under contract to Statoil. “The deficiencies on 

the Henry Goodrich were numerous - more than 50, and were split - about 50% being in 

non-compliance with "good oilfield practice", and 50 % in non-compliance with our 

regulations. Of the latter, many of them would not pass the "good practice" test 

either.”28

Peer Offshore Regulatory Regimes – Risk Based Approach to Managing Safety

As part of its investigation, the Commission examined the safety oversight of offshore oil 

and gas activity in other developed countries. The United Kingdom and Norway, after 

tragic disasters, transformed from prescriptive regimes to a model built on baseline 

prescriptive regulations with performance requirements that force industry to go well 

beyond simple compliance. Australia and Maritime Canada, both in transition now 

after their own accidents, and the agenda of the International Regulators Forum (IRF) 

offer additional insights.29

Risk-Based Approach to Regulating Offshore Oil and Gas Activities. All of these other 

regulators have undergone a shift in philosophy and practice from a focus on prescriptiveonly regulations enforced with inspections to a risk-based performance approach specific 

to individual facilities, operations, and environments. This approach, sometimes referred 

to as a safety case or more generally, a safety assurance review, puts the burden on the 

companies seeking license to operate in sovereign waters to demonstrate they have 

identified all of the hazards and risks associated with a specific activity and developed a 

plan to manage those risks. In addition to production platforms, the petroleum-related 

activities of MODUs, like the Deepwater Horizon, are also regulated under a safety case or 

subject to a certification and safety management requirement.

 (See attached Appendix B: Comparison of National Offshore 

Oil and Gas Regulatory Regimes for more information.)

30

These regulators all require a careful identification of the hazards, risks, and 

consequences of a specific activity, whether drilling exploratory wells in a frontier 

province or managing an aging production platform. These regulators are under no 

illusion that this approach can eliminate risk or dangers. They do, however, believe such 

 27 Max Ruelokke is the Chairman and Chief Executive Officer of the Canada-Newfoundland and Labrador 

Offshore Petroleum Board. http://www.cnlopb.nl.ca/abt_management.shtml. 28 Conversation with Max Ruelokke, at IRF meeting then confirmation details in an email dated November 24, 

2010. 

29 The information on the international regulators is based on a number of conversations and interviews as well as 

research on the websites of the regulators from Norway, the United Kingdom, Australia and Newfoundland, Canada. 30 Based on interviews with the staff of BOEMRE and various public statements and testimony, the agency holds the 

operator responsible for the activities of its contractors, including the MODUs.
11

an approach is essential to avoid the complacency inherent in a regime too reliant on 

prescription-based regulations only. 

All of the peer regulators also require reporting of major uncontrolled hydrocarbon 

releases, which are categorized as “dangerous occurrences.” Root cause investigations 

are a priority with such incidents, as they are the most significant leading indicator for 

dangerous accidents. Annual reports with detailed summary operational and 

occupational statistics, including injuries and lost work time, incidents by type and 

severity, and root cause investigations, are actively reviewed with industry. 

A report from the Norwegian Petroleum Safety Authority’s ongoing Risk Level in 

Petroleum Activity study has reaffirmed that “[t]he two types of near misses for the 

probability of acute discharges are well control incidents and hydrocarbon leaks. 

Although the latter largely relate in practice to gas escapes, they have been included in 

this study because they could cause very serious explosions. These in turn might 

escalate to cause well damage and thereby acute discharges to the sea. The Piper Alpha 

disaster on the UK continental shelf in 1988 provides a case in point.”31 Steve Walker of 

the Health and Safety Executive called the UK statistics not good enough when he 

released the 2009 statistics: “Major and significant hydrocarbon releases are up by more 

than a third on last year. This is a key indicator of how well the offshore industry is 

managing its major accident potential, and it really must up its game to identify and 

rectify the root causes of such events.”32 In a newsletter to offshore workers, he 

exhorted their cooperation as well.33 

Norway. Following a tragic platform failure that took 123 lives, by the mid-1980s 

Norwegian regulators had recognized that the inspection-based approach was wholly 

inadequate.34 Thus the Norwegian system evolved toward regulations “that describe 

what must be achieved, not how it must be.”35

 31 Risk level in the petroleum activity – project report – acute discharges – Norwegian continental shelf – 2001-09, 

released 11/18/2010, available at http://www.ptil.no/news/new-rnnp-report-surveys-acute-discharge-risk-on-thencs-article7407-79.html.

 The Petroleum Activities Act, effective in 

1985, made three key changes: first, creation of a new overarching body of rules on 

safety for petroleum activities; second, a requirement on licensees to implement 

32 HSE has maintained a data base of hazard indicators since the Cullen Report. 

https://www.hse.gov.uk/hcr3/help/help_public.asp#Severity "Offshore industry warned over 'not good enough' 

safety statistics", August 24, 2010. http://www.hse.gov.uk/press/2010/hse-offshorestats.htm. While this report was 

clearly in the aftermath of the Macondo and Montara blow outs, the report out of the prior year’s safety statistics

referenced related marine and helicopter fatalities not under HSE’s remit as well as the intent to be take a “tough 

approach to poor performers to help preserve and improve the industry's safety performance as a whole.” 

http://www.hse.gov.uk/press/2009/e09061.htm

33 http://www.hse.gov.uk/offshore/teashacknews/nov10.pdf 34 In March 1980, the Alexander Kielland—built as a drilling rig but under lease to Phillips Petroleum Company to 

house offshore workers at the Ekofisk Field in the Norwegian North Sea—capsized, killing 123 of the 212 people on 

board the “flotel.” http://www.ptil.no/news/learning-from-incidents-in-focus-at-the-safety-forum-annualconference-article6986-79.html. 35 Commission Staff Interview with Magne Ognedal, Director General of the Norwegian Petroleum Safety 

Authority, Sept. 7, 2010. 
12

internal controls; and third, the use of risk analyses.36 The law also unified responsibility 

for mobile units, formerly under the jurisdiction of the maritime authority, and fixed 

installations under the National Petroleum Directorate (NPD). Safety regulation in 

Norway has since been moved to a separate entity, the Petroleum Safety Authority 

(PSA).

The regulations are risk-based and must be applied as appropriate for each location and 

activity. Guidance documents refer to codes and standards that are considered 

acceptable. The regulator has asked industry to develop standards for specific 

purposes: for example, aging infrastructure. 

Drilling rigs, some of which are MODUs, are required to have an Acknowledgement of 

Compliance (AOC) in order to operate; the AOC is similar to the safety case used 

elsewhere.

37

 

 A rig or MODU owner must go through a detailed certification process and 

meet the requirements for equipment and workforce to obtain the AOC. If the rig or 

MODU leaves the Norwegian North Sea, it must continue to operate under all terms and 

conditions of the AOC or resubmit to an extensive recertification process.

According to PSA Director General Magne Ognedal, Norway asks companies to do 

everything required in the U.K. safety case but has less emphasis on a comprehensive 

set of documents. (Uniquely, the Norwegian Petroleum Directorate is a member of the 

operator’s management committee and has access to all documentation that is shared 

with the PSA.) Prior to any drilling activities, a company must file a consent application 

that includes use of an AOC rig, spill response plan, and specific drilling plans. The PSA 

reviews the plans for “fit for purpose,” then may either consent or require changes 

and/or more information. 

United Kingdom. The use of the safety case in the U.K. came from the 

recommendations of Lord Cullen in his Report of the Public Inquiry into the Piper Alpha 

Disaster.38 A critical recommendation was for a single regulatory body for offshore 

safety that would be responsible for fixed installations as well as mobile production and 

drilling units. Responsibility for regulating the offshore industry was also brought under 

the Health and Safety Executive (HSE).39 Lord Cullen’s first three recommendations laid 

out the main requirements for the safety case: 

40

 36 “From prescription to performance in petroleum supervision” http://www.ptil.no/news/from-prescription-toperformance-in-petroleum-supervision-article6696-79.html 37 Guidelines for AOC application is available at http://www.ptil.no/getfile.php/Regelverket/SUT-veiledningen_e.pdf 38 The Piper Alpha production platform operated by Occidental Petroleum 120 miles northeast of Aberdeen, Scotland, 

exploded and sank, killing 167 people, including 2 rescuers in July 1988. 

http://home.versatel.nl/the_sims/rig/pipera.htm.

39 Moving the responsibility for offshore safety into the larger HSE allowed the program to draw on a pool of expertise 

in areas such as fire protection and management of other hazardous industries.

40 Recommendations 4-13 provided specific details for compliance as well as transition issues. (p. 387-8). Magne 

Ognedal had testified before Lord Cullen regarding the evolution in thinking and practice in the Norwegian North Sea. 
13

1) The operator should be required to submit to the regulatory body a Safety 

Case in respect of each of its installations. 

2) The Safety Case should demonstrate that certain objectives have been 

met, including the following:

(i) that the safety management system (SMS) and that of the installation41

(ii) that the potential major hazards of the installation and the risks to 

personnel thereon have been identified and appropriate controls 

provided, and 

are adequate to ensure that (a) the design and (b) the operation of the 

installation and its equipment are safe; 

(iii) that adequate provision is made for ensuring in the event of a major 

emergency affecting the installation (a) a Temporary Safety Refuge (TSR) 

for personnel on the installation; and (b) their safe and full evacuation, 

escape and rescue... 

3) The SMS should be in respect of (a) the design (both conceptual and 

detailed) of the operator’s installations; and (b) the procedures (both 

operational and emergency) of those installations. The SMS should set out 

the safety objectives, the system by which these objectives are to be 

achieved, the performance standards which are to be met and the means by 

which adherence to these standards is to be monitored. It should draw on 

quality assurance principles similar to those stated in BS 5750 and ISO 9000. 

HSE is involved from the initial design stage in reviewing the safety case and issues 

extensive guidance “intended to help decision-makers assess the relative importance of 

codes and standards, good practice, engineering judgment, risk analysis, cost benefit 

analysis and company and societal values when making decisions.”42 The safety case 

must be presented and defended to a review team at HSE prior to commencement of 

any activities, where a major focus is especially on major hazards or (process) safety. 

The standard is to manage risks to “a level as low as reasonably practicable” (ALARP)43. 

A third party evaluation is required for well designs and all critical safety elements of the 

project including equipment, such as blowout preventers. 

 Lord Cullen acknowledged that testimony in his recommendations. The Public Inquiry into the Piper Alpha Disaster, 

Cullen, The Honourable Lord, HM Stationery Office, 1990, p. 387.

41 “installation” refers to any facility, whether a platform or mobile offshore drilling unit (MODU). 

42 The system as now implemented by HSE is detailed in the Offshore Installations (Safety Case) Regulations 

2005 (SCR05). HSE Information Sheet, Offshore Information Sheet No. 2/2006, Offshore Installations 

Regulations 2005, Regulation 12 Demonstrating compliance with the relevant statutory provisions, U.K. Health 

and Safety Executive, http://www.hse.gov.uk/offshore/is2-2006.pdf 43 ALARP is not a recognized standard in the U.S. See Steinzor, Rena I., Lessons from the North Sea: Should 

'Safety Cases' Come to America? (2011). Boston College Environmental Affairs Law Review, Vol. 38, 2011; U of 

Maryland Legal Studies Research Paper No. 2011-3. Available at SSRN: http://ssrn.com/abstract=1735537
14

Some have criticized the safety case as implemented by HSE as industry self-regulation 

or an extensive, contractor-driven paper exercise. Steve Walker, Head of the Offshore 

Division, HSE, flatly denies those criticisms.44

• our Safety Case Regulations do not set standards of control - those are set in 

other more specific regulations such as those that require the prevention of fire 

and explosion, proper well design and control, emergency evacuation 

arrangements, etc;

 He described the HSE approach as follows: 

• a Safety Case demonstrates that the duty holder has arrangements in place,

which, if implemented, are capable of achieving compliance with the legal 

objectives of the specific regulations. HSE's assessment (and eventual 

acceptance) of the Safety Case is based on our judgment that the arrangements 

and measures described in it, taken as a whole, are likely to achieve compliance 

with the specific regulations if implemented as described;

• a Safety Case is a document that gives confidence to both the duty holder 

and the regulator that the duty holder has the ability and the means to control 

the major accident risks effectively - it provides an extra level of regulatory 

control on top of the specific regulations; 

• but (and this is the point I think missed by [many]) confirmation of 

compliance is made by the post-acceptance programmes of inspection and

enforcement, based on the accepted safety case. 45

Australia. The offshore safety policies and practices in Australia are modeled to some 

extent on those of the U.K. HSE. The National Offshore Petroleum Safety Authority 

(NOPSA)46 is the safety regulator in federal as well as in state and territorial waters, but 

has not had jurisdiction over well design and integrity. Australia also took on the 

recommendations of the Cullen Report and moved to a safety case approach to regulate 

production.47 The safety case, in the words of NOPSA CEO Jane Cutler, is characterized 

by an acceptance that “the ongoing management of safety on facilities is the 

responsibility of those best placed to manage the risks - the operators. The role of role 

of the regulator is to provide robust challenge and oversight.”48 

As in the U.K., all facilities – drilling ships, MODUs, and platforms – must have a safety 

case. Unlike the U.K. HSE, NOPSA is not engaged in the safety review process until after 

the production design plans under the safety case have been developed. 

 44 Steve Walker described the safety case as “not like a magic toad you wave over a platform like a blessing. It’s 

a living document.” Discussion with Steve Walker and other regulators in Herndon, VA, September 9, 2010. 45 Email from Steve Walker dated October 24, 2010. 46 http://nopsa.gov.au/ 47 The transition to the current regime in response to Piper Alpha (1988) began with a series of amendments to 

the legislation the offshore oil & gas industry between 1992 and 1996 to transition to a safety case regime.

48 Interview with Jane Cutler and Simon Schubach, September 10, 2010 (Washington, D.C.)
15

In the case of the Montara well blowout in Australian waters in 2009, the authorities of 

the Northern Territory were responsible for the review of the well design and operator’s 

safety case. The outcome of the inquiry into the Montara blowout is a 

recommendation to transfer responsibilities for well design and integrity to NOPSA.49 

Maritime Canadian Provinces. The Canadian Maritime provinces have independent 

joint boards with the federal government - Canada-Newfoundland and Labrador 

Offshore Petroleum Board and Canada-Nova Scotia Offshore Petroleum Board.50 Unlike 

the North Sea and Australian models, leasing, as well as safety and environmental 

regulation are managed by the same entity.51 While not using the term safety case, 

“the Operations and Safety Department has an established safety assessment process to 

review Operators' applications in a systematic manner prior to the Board issuing a work 

authorization. This process considers the safety of the activity as a whole and its 

component parts including the installation, its facilities, personnel and procedures. This 

process also provides confidence that each Operator has an appropriate system in place 

to manage risk to personnel both from major hazards and from day to day occupational 

hazards. As part of the safety assessment process, Safety Officers may visit installations 

or vessels to conduct a safety audit or safety inspection.”52 As in the North Sea and 

Australia, individual safety plans are required for facilities – drillings ships, MODUs, and 

production platforms. 

Independence and Professional Standing of the Safety Regulator. As noted, the safety 

regulators in Norway and the U.K. are part of the labor ministry and have no 

responsibility for leasing or revenue matters. They are charged solely with safety 

oversight and have the final authority to consent to or prohibit drilling plans and 

production operations. Such authority is proposed for the Australian regulator, but not 

yet in force. The Canadian regulators for Nova Scotia and Newfoundland and Labrador 

also manage the leasing, but each has a designated Chief Safety Officer with complete 

authority to shut down operations in the interest of safety or environmental protection. 

These regulators are responsible for overseeing and ensuring the integrity of hazardous 

activities, including and especially the protection of the offshore workforce. Each of 

these regulators is headed by someone selected competitively based on technical 

credentials and experience, and their decisions with regard to safety are not lightly or 

easily circumvented or overturned. The harsh offshore environments of the North 

 49 Release of the Montara Commission of Inquiry Report and Draft Government Response, 

http://www.ret.gov.au/Department/responses/montara/Pages/MontaraInquiryResponse.aspx

50 Information on the Canadian systems from discussions with Max Ruelokke, Chairman and CEO, CanadaNewfoundland and Labrador Offshore Petroleum Board, http://www.cnlopb.nl.ca/, and Stuart Pinks, CEO, 

Canada-Nova Scotia Offshore Petroleum Board, http://www.cnsopb.ns.ca/, September 9, 2010 (Washington, DC) 

and October 18-19, 2010 (Vancouver, BC, Canada) and from the websites. 51 The Newfoundland and Labrador government have called for an independent safety agency for its offshore oil 

sector.

52 Quoted from the description of the Safety Assessment on the website of the Canada-Newfoundland and Labrador 

Offshore Petroleum Board. http://www.cnlopb.nl.ca/safe_assess.shtml
16

Atlantic and remoteness of the Australian offshore, especially as compared to the Gulf 

of Mexico, have required each to have specialized, professional staff. All of the 

regulators have the hiring authority and benchmarked salary scales to recruit a highly 

skilled technical staff. The emphasis tends to be on advanced degrees in engineering 

and/or experience in oil and gas or other high-risk industries. 

Continuous and specialized training is a priority. Several of the regulators believe the 

emphasis on ongoing training is a competitive advantage in recruitment. All either have 

or are working toward tailored training and certification programs. Some technical 

training is offered in-house by the regulators, but personnel often attend specialized 

university courses and training programs certified by industry organizations. All of these 

regulators have their own programs in inspection practices. Some have courses on 

investigation techniques put on by the national police.

Other areas of commonality among the peer regulators discussed above include the 

approach to inspections and responsibility for and engagement with the offshore 

workforce. All of these regulators have team approaches to supervision, audits and 

inspections. Oversight is planned and scheduled with staffing determined based on the 

scope of activities and, to an extent, familiarity with specific facilities and operations. 

Shore-based audits start the process, with offshore inspections carried out using a 

systems approach rather than a checklist. The emphasis is on assessing the actual 

performance of management systems. Some continuity in staffing for audits is valuable 

but all have safeguards to avoid “capture.” 

These regulatory systems all have active tri-partite engagement involving the regulator 

with the offshore workforce as well as the companies. Labor has an official voice in all 

of these regimes, whether through unions or statutorily guaranteed worker safety 

representatives. The North Sea industry is heavily unionized, whereas Canada and 

Australia have some union presence. The U.K. and Australia have specific statutory 

requirements for worker-elected safety representation with both authority and 

responsibility. In Canada individual workers have a duty of safety. All actively promote 

labor engagement in industry efforts to improve safety management. The U.K. 

regulator, for example, has a quarterly newsletter for the offshore workforce where it 

reaches out for support to address critical challenges.53 Surveys of the offshore 

workforce are conducted on a periodic basis to assess the safety culture. 

Recommendation for an Independent U.S. Safety Authority

In the United States, efforts to move toward the sort of regulatory reforms described 

above in other countries have met with little success. In recent years, as lucrative 

deepwater oil production grew, so did the political pressure on the Department of the 

 53 The November 2010 issue of the “Teashack,” a newsletter published by HSE for offshore workers, calls on workers 

to help reduce hydrocarbon releases. http://www.hse.gov.uk/offshore/teashacknews/nov10.pdf
17

Interior to increase revenues. As the Wall Street Journal reported, “Stephen Allred, who 

as Assistant Secretary of the Interior oversaw MMS from 2006 to 2009, said the agency 

does conduct spot inspections of oil rigs, and checks operators’ compliance with safety 

procedures. However, ‘Their role is not to baby-sit’ the operators, he said. The agency's 

primary task during inspections is to verify how much oil is being pumped, which is key 

to another MMS duty, maximizing payments the government receives for oil and gas 

rights from energy producers.”54 

Allred’s comments reflect the Congressional pressure on the agency to generate 

revenues. Inspectors were under constant pressure to ensure production and verify 

pipeline meters, even to the point of inspecting meters at onshore processing plants, in 

place of time spent on the safety aspects of offshore facilities.55

The Offshore Program, recognizing the need to better manage its responsibilities, hired 

LMI Government Consulting in 2006, tasking the company with evaluating “its 

organizational effectiveness by functionally assessing the program, with the goal of 

improving organizational efficiency and effectiveness in an environment of increasing 

workload and requirements.” 56 Although the program had a record for effectively 

awarding and managing oil and gas leases, 57 LMI pointed to the inherent conflict of 

awarding leases while also regulating the operations of the oil and gas industry.58 This 

conclusion was demonstrated clearly when a survey of senior leaders showed that they 

believed the dominant focus of the program was on Access to Resources over all other 

priorities.59 

Other findings of the study included: 

• Need to clarify roles and responsibilities, resource requirements, and funding.60

• Inconsistent and unstructured approach to information management...difficulties 

in determining and disseminating best practices, over reliance on long-service 

members of staff as sources of knowledge, cultural barriers between head office 

and regional staff, and duplication of effort between regions.61

• Some functions appeared to overlap...coordination of resources could be 

improved in the permitting function, and research could be streamlined if all 

efforts were consolidated. 62

 54 “Oil Regulator Ceded Oversight to Drillers”, Wall Street Journal, May 7, 2010. 55 Non-public government document and interviews with BOEMRE staff. 56 Offshore Minerals Management, Business Assessment and Alignment, report INT60TI, LMI Government Consulting, 

May 2007. (Hereafter referred to as “LMI”). p. 1-1. The review involved “not for attribution” interviews of 96 staff 

members and 22 external stakeholders, as well as workshops and a series of sessions to develop an implementation 

plan. . P. 2-5. 57 In fact, the MMS offshore program had been in the top 11% for program effectiveness rated by the Office of 

Management and Budget (OMB) for Fiscal Year 2005. p.3-7. 58 LMI p.3-6. 59 LMI, p. 3-3.

60 LMI, p. 3-6. 61 LMI, p. 5-3. 62 LMI, p. 3-7.
18

• At times decisions are made ad hoc and tend to be reactive rather than 

proactive. Too many functions were geographic or personality-based rather 

than process driven63. 

Among the report’s conclusions: 

• Roles and responsibilities need clarification.64

• Services, such as inspections, would become increasingly complex, with more 

operations, including possible operations in the Arctic. [The program] will best 

serve both its customers and the public if it has access to the same technology as 

industry and can base its decisions on up-to-date science.65

• The workforce appeared to be more risk-averse than most government agencies 

with which LMI had worked.

 

66

Based on Commission staff interviews with the MMS staff involved, the last conclusion 

foreshadowed the agency's oversight role during the early days of the response to the 

Macondo blowout, as agency staff appeared hesitant to assert themselves.

 

67

The overarching recommendation of the LMI review was that the program should 

realign its workforce in a more efficient functional structure to better use its existing 

expertise.68 Senior staff spent months on the review in 2006-7, only to have it shelved, 

not implemented. DOI Secretary Ken Salazar’s Safety Oversight Board came to similar 

findings and conclusions, albeit from a more dispirited workforce, in 2010.

69

The overlapping authorities of BOEMRE and the Coast Guard have encouraged industry 

to argue against duplication, while both agencies, underfunded and without a unique 

mandate, have failed to protect offshore workers. The gap posed by the lack of OSHA 

responsibility offshore can be filled by a single agency. An agency with its own organic 

act

 

70

 63 LMI, p. 3-9.

and a clear, unambiguous portfolio could eliminate the conflicts of interest and 

political pressures existing today. Such an authority would consolidate the responsibility 

for safety, including infrastructure and operational integrity, as well as spill prevention 

and response, for all offshore oil and gas and renewable energy development activities, 

structures, and workers. That agency would also have a statistical and analytical 

responsibility to collect and produce data that contribute to better risk analysis. 

64 LMI, p. 3-9 65 LMI, p. 3-6

66 LMI, p. 3-11. 67 Staff Working Paper No. 6, entitled "Stopping the Spill: The Five-Month Effort To Kill the Macondo Well." P. 7 68 LMI, p. 3-11 69 Outer Continental Shelf Safety Oversight Board, Report to Secretary of the Interior Ken Salazar, 

September 1, 2010, available at 

http://www.doi.gov/news/pressreleases/loader.cfm?csModule=security/getfile&PageID=43677

70 An organic act is a statute enacted by Congress that creates an administrative agency and defines its 

authorities and responsibilities.
19

In Europe, change followed major accidents. Magne Ognedal, the Director General of 

the Norwegian Petroleum Safety Authority, described the evolution of the Norwegian 

system in a number of conversations with Commissioners and staff. “My experience is 

that you unfortunately often need a major accident, or even a disaster, to engender 

political support for streamlining regulatory regimes. Moreover, history shows that 

major accidents apparently must happen in your own jurisdiction to have such an effect 

on political support. Before 1985, we had 13 different agencies or authorities with selfcontained powers and regulations to regulate parts of our offshore activities.”71 The 

U.S. can similarly learn from the Deepwater Horizon disaster and consolidate 

responsibility. 

An organic act delineating the authorities and responsibilities for an independent safety 

authority would constructively consolidate the various responsibilities now under the 

Outer Continental Shelf Lands Act (OCSLA), the Pipeline Safety Act, and various Coast 

Guard Authorizations. A standalone safety act would lead to focused Congressional 

oversight on the new agency’s record in personal as well as system safety as is the case 

already with other hazardous industries, including onshore pipelines.72

Ensuring Independence. Though some aspects of a new, independent safety agency can 

be implemented by the administration, Congressional action would still be needed. 

Only statutory requirements for a fixed term for the director and the primacy of 

technical judgment over politics can ensure the long-term independence of the safety 

agency. The director position should be held by someone with technical qualifications 

and experience recruited through a professional search. The authority to assess 

program costs on the regulated industry would also require legislation. Legislation 

would also be required to consolidate responsibility and authority for energy worker 

safety whether on a mobile drilling unit, a production platform, or engaged in installing 

a wind tower. 

 

Funding the Regulator. To ensure the agency has the ability to provide adequate 

regulatory oversight to the increasingly complex OCS program, the budget for the 

agency should be funded directly from an assessment on the regulated industry, 

recovered under a formula related to production volumes, for example. Experience has 

clearly shown that the regulator must be adequately funded on a consistent basis in 

order to maintain staff capability and competence at the highest standard to regulate 

and supervise high hazard activities in remote offshore locations. That requires funds 

for helicopters and other vessels, ongoing training and the capability to respond 

immediately as needed in emergencies. 

 71 The exact quote is from an interview available at 

http://budsoffshoreenergy.wordpress.com/interviews/magne-ognedal/ but he shared the same perspective 

information directly with the commission in a meeting on November 10, 2010 in Washington, DC. 

72 The Pipeline Inspection, Protection, Enforcement, and Safety Act of 2006, Public Law No: 109-468, imposed 

new requirements for previously unregulated low-stress pipelines in response to the BP pipeline spills on the 

North Slope of Alaska in 2006. The act also authorized funding for the program for fiscal years 2007-2010. 
20

Many other U.S. federal regulators are funded with such assessments.73 Comparable to 

the Department of the Interior’s role related to the offshore energy sector, the Federal 

Communications Commission sells access to the spectrum under a competitive bidding 

process, but recovers its cost of regulating industry activities in the public interest 

through a formula based assessment on the regulated industry.74 Other parts of the oil 

and gas industry pay such assessments for safety oversight programs, including the 

Office of Pipeline Safety.75 

These assessments on regulated industries are consistent with OMB guidance, “[I]f the 

benefits accrue to a limited number of private individuals or organizations and do not 

have special social or distributional benefits, then the program should be financed by 

charges paid by the private beneficiaries.”76 The performance of other hazardous 

industries subject to federal safety regulation, such as petroleum and natural gas 

pipelines, are reviewed periodically be the Congress under a regular reauthorization 

process. The agency and the Congressional oversight committees are forced through 

that process to ensure the statutory responsibilities and funding are adequate to the 

challenge. 

Challenges with Opportunities

Creating a more competent and nimble regulator faces several major challenges. First, 

there has been reluctance among some in the oil and gas industry to acknowledge that 

safety standards for offshore drilling in the Gulf of Mexico fall below those elsewhere in 

 73 The Federal Energy Regulatory Commission also “recovers the full cost of its operations through annual charges and 

filing fees assessed on the industries it regulates as authorized by the Federal Power Act (FPA) and the Omnibus 

Budget Reconciliation Act of 1986. The Commission deposits this revenue into the Treasury as a direct offset to its 

appropriation, resulting in no net appropriation.” http://www.ferc.gov/about/strat-docs/FY11-budg.pdf. 74 Section 6003 (a) of the Omnibus Budget Reconciliation Act of 1993 (Public Law 103-66) added a new Section 9 to 

the Act. Section 9 (a) of the Communications Act authorizes the Commission to collect annual regulatory fees to 

recover the annual costs of its enforcement, policy and rulemaking, user information, and international activities. 47 

U.S.C. 159 (a). 47 U.S.C. 159 (b) (1) (A) and 47 U.S.C. 159 (g). The Schedule of Fees sets forth annual regulatory fees for 

specific categories of regulates in the Mass Media, Common Carrier, Wireless, International and Cable Television 

Services. http://www.fcc.gov/fees/. The Federal Communications Commission also auctions licenses for commercial 

use of the electromagnetic spectrum, http://wireless.fcc.gov/auctions/. 

75 “Section 60301 of Title 49, United States Code, authorizes the assessment and collection of pipeline user fees to 

fund the pipeline safety activities conducted under 49 U.S.C. 60101 et seq. The Pipeline and Hazardous Materials 

Safety Administration (PHMSA) assesses each operator of regulated interstate and intrastate natural gas transmission 

pipelines (as defined in 49 CFR Part 192), and hazardous liquid pipelines carrying petroleum, petroleum products, 

anhydrous ammonia and carbon dioxide (as defined in 49 CFR Part 195) to pay a share of the total Federal pipeline 

safety program costs in proportion to the number of miles of pipeline each operator has in service the end of calendar 

year 2008.” http://www.phmsa.dot.gov The 2010 fee assessed on liquid pipelines was offset by $18.8 million, 

roughly half of the total program allocated , from the Oil Spill Liability Trust Fund. Letter dated April 5, 2010, from 

Cynthia Quarterman, Administrator, Pipeline and Hazardous Materials Safety Administration, to Senator Daniel K. 

Inouye, Chairman, Committee on Appropriations.

76 Analytical Perspectives, Budget Of the U.S. Government, Office of Management and Budget, fiscal Year 2011, 

www.budget.gov, p. 201. See also OMB Circular No. A–25: “User Charges’’ (July 8, 1993).
21

the world; if there is no problem, this is no need to change. Second, new approaches to 

regulation will require additional funding to implement during a period when focus will 

be on reducing the costs of government. Third, needed reforms will take time, 

particularly for incorporating greater competence to analyze risk at an agency where the 

necessary skills sets are not adequately represented.

But there are opportunities as well. The spill at Macondo demonstrated that there are 

costs to accepting higher than necessary risks of blowouts and led to a reexamination of 

the historic safety statistics, some of which are presented here, which demonstrated a 

poor safety record in the Gulf, even before Macondo. Moreover, regulatory models in 

other countries, earlier planning at the Department of the Interior, and reinvigorated 

planning after last year’s spill mean that reforms will not have to start from scratch.
Appendix A: Loss of Well Control Incidents

22
23

Appendix B: Comparison of National Offshore Oil and Gas Regulatory Regimes 

The purpose of this appendix is to give interested readers more information on, and 

links to, the various offshore regulatory agencies outside the United States. Unless 

otherwise stated, the material is from the agencies’ websites. 

Norway.1

Ministry of Energy

Management of offshore activities is divided among a number of Norwegian 

government entities. Under the ,

2 Norwegian Petroleum 

Directorate (NPD)

the 

3

Petroleum Safety Authority (PSA)

is responsible for negotiating lease concessions based on 

competition among companies on technical competence and financial commitments. 

The 4

, under the Department of Labor, participates in 

the evaluations. Companies must be approved by the PSA, which sets standards and 

limits on participation depending on the location, both at the initial leasing stage and 

subject to review prior to any development activity. Companies new to the region or 

lacking experience are accepted only as part of an experienced team. Projects are 

managed collectively, with all parties liable. The NPD participates on the management 

committee of each development and has access to all data and plans, which it shares 

with the PSA. If the PSA is not convinced that the companies have adequately 

considered all risk, a project is not allowed to proceed. The NPD approves development 

plans to ensure efficient and optimal recovery of resources, but the PSA must consent to 

drilling plans before activity proceeds. 

By the mid-1980’s5 Norwegian regulators recognized the need to shift from the

traditional inspection-based approach, which had not proved sufficient. The Norwegian 

system evolved toward regulations that describe what must be achieved, not how it 

must be achieved. The regulations are risk-based and must be applied as appropriate 

for each location. Guidance documents refer to codes and standards that are 

considered acceptable. The PSA has asked industry to develop standards for specific 

purposes – aging infrastructure, for example. The regulatory process is one of consent,

not approval, with the burden on industry to prove that its plans should gain consent. 

The PSA created a requirement for an Acknowledgement of Compliance (AOC)6

 1 Information on the Norwegian system partly from discussions with Magne Ogdenal, Director General, and senior 

staff of the Petroleum Safety Authority, September 7, 2010 (Washington, DC) and November 4, 2010 (Washington, 

DC).

for 

drilling rigs – similar to a safety case for a rig. A rig owner must go through a detailed 

2 Norwegian Ministry of Petroleum and Energy, http://www.regjeringen.no/en/dep/oed.html?id=750 3 Norwegian Petroleum Directorate, http://www.npd.no/en/

4 The Petroleum Safety Authority was part of the National Petroleum Directorate until January 2004. 

http://www.ptil.no/main-page/category9.html 5 In March 1980, the Alexander Kielland—built as a drilling rig but under lease to Phillips Petroleum Company to 

house offshore workers at the Ekofisk Field in the Norwegian North Sea—capsized, killing 123 of the 212 people on 

board the “flotel.” http://www.ptil.no/news/learning-from-incidents-in-focus-at-the-safety-forum-annualconference-article6986-79.html. 6 Guidelines for AOC application is available at http://www.ptil.no/getfile.php/Regelverket/SUT-veiledningen_e.pdf
24

certification process and meet the requirements for equipment and workforce. If the 

rig leaves the Norwegian North Sea, it must continue to operate under all terms and 

conditions of the AOC or it will have to go through an extensive recertification process in 

order to return. 

The PSA staff is largely comprised of degreed technical professionals in fields ranging 

from engineering to anthropology. “[C]ore competencies for personnel performing 

offshore audits and verifications were identified as high level skills within: incident 

investigation, auditing practices, risk management and Human Factor methodology. 

These core competency skills were to accompany the various professional backgrounds 

of PSA personnel. The PSA has worked with the University of Stavanger to develop a 

graduate level curriculum that has evolved into a Masters in Risk and Safety 

Management, open to industry as well as staff of the PSA. Some of the course modules 

are available online.7

The training across core competencies provides a common basis for supervisory 

activities independent of discipline background. The PSA believes the training program 

provides a recruitment advantage. In addition to being a two-way, synergistic learning 

arena it also leaves the formal handling of content and overall responsibility for modules 

and the masters program to the university. 

 

The professional staff participates in all activities: development of regulations, audits, 

and verification of industry operations offshore. Audits of company facilities are scoped 

prior to visits to offshore facilities with the team picked to address the specific situation. 

Norway asks companies to do everything required in the UK safety case approach but 

has less emphasis on a comprehensive set of documents. Four weeks prior to any 

drilling activities, a company must file a consent application that includes use of an AOC 

rig, spill response plan, and specific drilling plans. PSA reviews the plans then, and may 

either consent or require changes and/or more information. 

The agency sets priorities in its annual supervision plan for audits and verifications. This 

is a strategic document not disclosed to the public or the affected industry. Inspections 

are organized based on perceived risks, including recent experience and trends with 

accidents and incidents, industry plans, input from other cooperating agencies, and the 

consequences of new or revised regulations. The PSA visits each facility at least once 

every three years. 

 7 In 2005 a strategic PSA Competency Plan was developed, aimed at developing core competency modules at the 

masters level through a University of Stavanger cooperation project. The initial activities resulted in an ongoing 

parallel development approach by the 5 cooperating state agencies (covering health and environment). The master 

program is being introduced in the spring 2011 with 7 PSA participants. From an email from Odd Bjerre Finnestad 

dated January 14, 2010.
25

An annual safety report is released at a Safety Forum8 with industry and labor. The 

health and safety environment in general and recent incident and spill experience is 

reviewed with industry to focus efforts at improving performance. The annual Trends in 

Risk assessment effort, initially focused on major accidents, has shifted scrutiny to risks 

of hydrocarbon releases.9 A biannual confidential survey of industry workers is 

conducted to assess their experience. 

Audits and inspections of individual operators are planned based on the overall set of 

risk-based priorities. Through audits (systematic examination of management and 

control systems) the PSA carries out supervision of the established systems. Norway has 

without question the most transparent oversight and supervision process of the peer 

group, including posting summaries of audit reports on the website.10 Audits are 

supplemented with verification measures including measurement, testing, and 

inspection.

United Kingdom (U.K).

11 The Department of Energy and Climate Change (DECC)12

Health and Safety Executive (HSE)

and 

the 13 manage offshore oil and gas activities in the U.K. 

The Director for Energy Development in DECC oversees both the Office of Oil and Gas 

Licensing, Exploration and Development and the Office of Environment and 

Decommissioning, which is responsible for environmental consultation and permitting. 

Safety and risk management are under the offshore office within HSE, a division of the 

Department for Work and Pensions. As in Norway, the DECC geologists and engineers 

evaluate development plans from the perspective of optimal resource recovery. HSE is 

responsible for setting standards and oversight of the safety case for all drilling and 

production activities. 

HSE requires a safety case14

 8

The Safety Forum, led by Director Magne Ognedal, includes the following: Norwegian Oil Industry Association (OLF), 

the Federation of Norwegian Industries, the Norwegian Shipowners' Association, the Norwegian Union of Energy 

Workers (SAFE), Lederne, the Norwegian Union of Marine Engineers (DSO), Industry Energy (IE), the Norwegian 

Confederation of Trade Unions (LO) and the Norwegian United Federation of Trade Unions. 

for each “facility;” the mobile offshore drilling units (MODU) 

would be required to have a safety case for any drilling operation. For production 

http://www.ptil.no/safety-forum/category167.html 9

The Risk Level Project, initiated in 1999, monitors risk levels using quantitative and qualitative measures, including 

incident indicators, barrier data, interviews, work seminars, field work and a major questionnaire survey every other 

year. http://www.ptil.no/trends-in-risk-level/category155.html. See also a paper titled “PSA's Risk Level Measuring 

Scheme and how available data are collected and used” presented by Torleif Husebø, Discipline Leader for Process 

Safety, at the International Regulators Offshore Safety Conference in October 2010, available at 

http://www.irfconference2010.com/uploadfiles/documents/Tuesday/1110%20Torleif%20Husebo.pdf

10 See the PSA website for a more thorough description of the supervision program as well as posted reports at 

http://www.ptil.no/audit-reports/category156.html 11 Information on the U.K. system from discussions with Steve Walker, Head Offshore Division, HSE on September 9, 

2010 (Herndon, VA) and October 19, 2010 (Vancouver, BC, Canada) and from the HSE website.

12 The office Heads for offshore licensing and environment both report to the Director, Energy Development. 

http://www.decc.gov.uk/assets/decc/About%20us/1_20100622105016_e_@@_deccorganogram.pdf 13 http://www.hse.gov.uk/offshore/index.htm 14 “The Offshore Installations (Safety Case) Regulations 2005 (SCR05) aims to reduce the risks from major accident 

hazards to the health and safety of the workforce employed on offshore installations, and in connected activities. The 
26

facilities, the operator would be required to have a safety case. The safety case must be 

presented and defended to a review team at HSE prior to any activities. HSE is involved 

from the initial design stage in reviewing the safety case. The operator must notify HSE 

21 days prior to any planned activities to have the well design reviewed. These reviews 

focus on major hazards safety (process safety). A third party evaluation is required for 

well designs and all safety critical elements of the project including equipment, such as 

blowout preventers.

Responsibility for regulating the offshore industry was brought under HSE after the 

report into the Piper Alpha disaster found that the “comparatively small size of the 

Safety Directorate appears to have been a factor restricting the scope of the in-house 

expertise” leading to a reactive approach rather than proactive systems management. 

Moving the responsibility for offshore safety into the larger HSE allowed the program to 

draw on a pool of expertise in areas such as fire protection and management in other 

hazardous industries. The transition to a safety case approach to managing offshore 

activities took several years and required a significant increase in staffing levels and 

expertise. Within HSE, the offshore program has a cadre of inspectors with backgrounds 

in oil and gas and other high-risk industries. Recruitment emphasis is on advanced 

degrees in technical fields and/or extensive experience. The strategy is to recruit 

experts, then train them to be inspectors. 

Safety culture is at the center of the management of all risks offshore, including major 

accident hazard risks (process safety). The regulations require the “safety case duty 

holders” to cooperate with all others to ensure the health and safety of all personnel on 

an installation. Documented safety management systems are required. 

The system is one of industry responsibility for demonstrating risk assessment and risk 

management, with an underpinning of minimum requirements. The safety case 

requires a demonstration by duty holders that all hazards that could cause a major 

accident have been identified; that all major accident risks have been evaluated; and

that measures have been, or will be, taken to control the major accident risks to ensure 

compliance with the relevant statutory provisions. The standard is to manage risks to “a 

level as low as reasonably practicable” (ALARP). HSE issues extensive guidance for risk 

assessment and development of safety cases. “These guidelines describe a framework 

that is intended to help decision-makers assess the relative importance of codes and 

standards, good practice, engineering judgment, risk analysis, cost benefit analysis and 

company and societal values when making decisions. They aim to encourage the 

 regulations implement the main recommendations of Lord Cullen's Report of the Public Inquiry into the Piper Alpha 

Disaster.” HSE provides extensive guidance on the requirements for developing a safety case as well as the oversight 

and audit process. http://www.hse.gov.uk/offshore/safetycases.htm
27

development of transparent decision-making processes, thereby helping duty holders 

meet their regulatory obligations.”15

Inspections are planned based on the activities and past experience at a specific facility. 

Manned platforms are subject to inspection 3-4 times per year, drilling units at least 

once a year. Pre-meetings are held with the companies prior to the offshore visits. 

Surprise inspections are not considered useful, as the intent is to test and validate the 

key elements of the safety case, including the management systems. Each facility’s 

safety case is thoroughly reviewed at least once every five years. 

HSE encourages offshore workers, especially through the trade unions, to be involved in 

managing their own health and safety. The Offshore Installations (Safety 

Representatives and Safety Committees) Regulations of 1989 provides the legal 

framework for safety representatives among the workforce who are independent of the 

management. These safety representatives have independent powers to investigate 

complaints, potential hazards, and accidents, and to make representations to 

management and the HSE on behalf of the workforce. To ensure the system is working 

as intended, HSE set up a Workforce Involvement Group (WIG)16 to review progress. 

The Step Change in Safety17 program was established in 1997 by the oil and gas industry 

trade associations with the aim of reducing the offshore injury rate through the 

development and sharing of best practices. The original plan to measure safety 

performance in relation to Lost Time Injury Frequency on offshore installations was

expanded to include aviation safety, marine safety, and the prevention of major 

accidents. The membership has also expanded to include HSE and the trade unions. 

Step Change appears to serve as an active communication and awareness tool for all 

stakeholders and is considered by HSE to be a critical part of maintaining the safety 

culture. 

Australia18

Department of Energy, Resources and Tourism

. With the exception of safety, the offshore industry in Australia is managed 

by the state and territorial governments in near coastal waters and by the federal 

19 in waters beyond the three-mile limit. 

Leasing is handled jointly by the state and federal authorities, depending on location. 

 15 HSE Information Sheet, Offshore Information Sheet No. 2/2006, Offshore Installations Regulations 2005, Regulation 

12 Demonstrating compliance with the relevant statutory provisions, U.K. Health and Safety Executive, 

http://www.hse.gov.uk/offshore/is2-2006.pdf 16 http://www.hse.gov.uk/aboutus/meetings/iacs/oiac/wig.htm 17 http://stepchangeinsafety.net/stepchange/

18 Information on the Australian system from discussions with Jane Cutler, head of NOPSA and Simon Schubach, 

September 10, 2010 (Washington, DC) and October 18-19, 2010 (Vancouver, BC, Canada) and from the NOPSA 

website.

19 http://www.ret.gov.au/Pages/default.aspx
28

The National Offshore Petroleum Safety Authority (NOPSA)20 is the safety regulator in 

federal as well as in the state and territorial waters. Australia took to heart the 

recommendations of the Piper Alpha Cullen Report and moved to a safety case 

approach with active worker involvement in safety culture. The policies and practices 

of NOPSA are modeled closely on, and appear to be implemented in very nearly the 

same manner as, those of the U.K. HSE. 

The transition to the current regime in response to Piper Alpha (1988) began with a 

series of amendments to the legislation covering the offshore oil and gas industry 

between 1992 and 1996 to transition to a safety case regime. The safety case is

characterized by an acceptance that the direct responsibility for the ongoing 

management of safety on facilities is the responsibility of those best placed to manage 

the risks: the operators. The role of the regulator is to provide robust challenge and 

oversight. In 1999, the Australian government commissioned an Independent Review 

Team (IRT), which endorsed the move to a consistent national approach to offshore 

safety. The principles for regulation that established NOPSA, included: 1) a consistent 

national approach, 2) a safety case approach, and 3) a legislative framework that is clear 

and enforceable and that requires operators to discharge their responsibilities for 

safety. NOPSA opened its doors on January 1, 2005.21

As in the U.K., all facilities – drilling ships, MODUs, and platforms – must have a safety 

case. Unlike the U.K. HSE, NOPSA is not engaged in the safety review process until after 

the production design plans under the safety case have been developed. In the case of 

the Montara well blowout in 2009, the authorities of the Northern Territory were 

responsible for the review of the well design and operator’s safety case. Based on the 

findings of the official inquiry into the Montara incident, Martin Ferguson, the Minister 

for Resources and Energy, declared the government’s intention to extend the functions 

of NOPSA to include structural integrity of facilities, wells, and well-related equipment, 

environmental regulation.22 

“The [Montara] Inquiry concurs with the view of other recent inquiries that 

responsibility for well integrity should be moved to the National Offshore Petroleum 

Safety Authority (NOPSA) (see below). Ensuring the integrity of the well is essential for 

ensuring safety and environmental outcomes. The Designated and Joint Authority (JA) 

arrangements currently in place pursue a mix of objectives: policy, promoting industry 

development and regulatory. The Inquiry is concerned that under these arrangements 

 20 http://nopsa.gov.au/ 21 Presentation by Jane Cutler, Vancouver, October 19, 2010 

http://www.irfconference2010.com/uploadfiles/documents/Wednesday/Jane%20Cutler.pdf

22 Statement by the Minister for Resources and Energy, the Honorable Martin Ferguson AM, MP, 

November 24, 2010. http://www.ret.gov.au/Department/Documents/MIR/montara-ministerialstatement.pdf. 
29

well integrity issues do not receive necessary priority, thereby prejudicing safety and 

environmental objectives.”23

The Minister’s speech and the draft Government Response to the Montara Report 

emphasize the government’s commitment to establish a single national regulator for 

offshore petroleum activities by January 2012. The proposed National Offshore 

Petroleum Safety and Environmental Management Authority will become the regulator 

for all offshore petroleum activities conducted more than three nautical miles from the 

territorial sea baseline. To ensure that the focus of the agency is clearly on the safety, 

integrity, and environmental performance of the offshore industry, title administration 

and related activities will be managed separately. 24

The level of unionization is low in the Australian offshore; however, the occupational 

health and safety legislation provides some authority and protection for nonmanagement workplace safety representatives. Incident reporting is kept confidential 

to encourage compliance, but a move to greater transparency is under consideration. 

The industry association does not have an equivalent to the U.K.’s Step Change in Safety

program.

Maritime Canada25

Canada-Newfoundland and Labrador Offshore Petroleum Board26

: The Canadian Maritime provinces have independent joint boards -

and Canada-Nova 

Scotia Offshore Petroleum Board27 - with the federal government to lease and manage 

offshore oil and gas development. Unlike the North Sea and Australian models, leasing, 

safety, environmental oversight, and regulation are managed by the same entity. 

However, the Newfoundland and Labrador government have called for an independent 

safety agency for its offshore oil sector. 

While not called a “safety case”, the regulators have “an established safety assessment 

process to review Operators' applications in a systematic manner prior to the Board 

issuing a work authorization. This process considers the safety of the activity as a whole 

and its component parts including the installation, its facilities, personnel and 

procedures. This process also provides confidence that each Operator has an 

appropriate system in place to manage risk to personnel both from major hazards and 

from day-to-day occupational hazards. As part of the safety assessment process, Safety 

Officers may visit installations or vessels to conduct a safety audit or safety 

 23 Report of the Montara Commission of Inquiry, Commissioner David Borthwick AO PSM, 

June 2010, http://www.ret.gov.au/Department/Documents/MIR/Montara-Report.pdf, p. 18 24 Details on the Government’s response to the Montara Inquiry may be found at 

http://www.ret.gov.au/Department/responses/montara/Pages/MontaraInquiryResponse.aspx

25 Information on the Canadian systems from discussions with Max Ruelokke, Chairman and CEO, CanadaNewfoundland and Labrador Offshore Petroleum Board and Stuart Pinks, CEO, Canada-Nova Scotia Offshore 

Petroleum Board, September 9, 2010 (Washington, DC) and October 18-19, 2010 (Vancouver, BC, Canada) and from 

the websites.

26 http://www.cnlopb.nl.ca/ 27 http://www.cnsopb.ns.ca/
30

inspection.”28 As in the North Sea and Australia, individual safety plans are required for 

facilities: drillings ships, MODUs, and production platforms. 

Oversight and inspections are managed in a manner similar to the North Sea, with 

comprehensive reviews of each facility’s safety plan once every three years. The Boards

meet with the industry quarterly for a thorough review of activities and incidents,

including a review of lessons learned. The Boards use the same training matrix for their 

staff to maintain up to date expertise as the Canadian industry,

29 supplemented with 

conferences on investigations put on by the Royal Canadian Mounted Police 

The Boards are independent and operate at arms-length from the Federal and Provincial 

Ministers of Natural Resources, and ministers cannot easily override the decisions of a 

Board Chief Executive. Each Board has designated a Chief Safety Officer with complete 

authority to shut down operations, based on unacceptable safety or environmental risk. 

An inquiry panel that investigated a 2009 helicopter crash that killed 17 offshore 

workers has recommended that a new, independent safety regulator be 

established for oil and gas activities offshore Newfoundland and Labrador.

This recommendation has been endorsed by the provincial government and is being 

reviewed by the Federal government.30

International Regulators Forum

A growing group of regulators from countries with offshore oil and gas activity –

certainly the U.S. and its peers - are members of the International Regulators Forum 

(IRF) on Global Offshore Safety.

31 International Committee on Regulatory Authority 

Research and Development (ICRARD)

 The 

32

 28 Quoted from the description of the Safety Assessment on the website of the Canada-Newfoundland and Labrador 

Offshore Petroleum Board. http://www.cnlopb.nl.ca/safe_assess.shtml

, an adjunct of the regulator’s forum, serves as 

the mechanism for sharing research and studies on health, safety, and environment in 

the petroleum sector. After two of the worst offshore blowouts and oil spills in history 

on opposite sides of the globe – the Montara well off Australia and the Macondo well in 

the U.S. Gulf of Mexico – the IRF held two meetings and an international safety 

29 http://www.capp.ca/getdoc.aspx?DocId=181712&DT=PDF, Atlantic Canada Offshore Petroleum Industry: Standard

Practice for the Training and Qualifications of Personnel, Canadian Association of Petroleum Producers (CAPP)

30 Offshore Helicopter Safety Inquiry Report, St. John's Newfoundland,

11/17/10: http://www.cnlopb.nl.ca/ohsi_information.shtml

Globe and Mail article, Sue Bailey, 12/13/10:

http://www.theglobeandmail.com/news/national/atlantic/newfoundland-premier-w

ants-independent-agency-to-monitor-offshore-oil-safety/article1835221/ 31 National Offshore Petroleum Safety Authority, (NOPSA);Petroleum Safety Authority, Norway, (PSA); US Bureau of 

Ocean Energy Management, Regulation & Enforcement (BOEMRE); New Zealand Department of Labor, (DOL); 

Canada-Nova Scotia, and Canada-Newfoundland and Labrador, Offshore Petroleum Boards, (CNSOPB / C-NLOPB); 

Brazilian National Petroleum Agency, (ANP); The Health and Safety Executive, Great Britain, (HSE); and State 

Supervision of Mines, the Netherlands, (SSM) 32 The International Committee on Regulatory Authority Research and Development (ICRARD) is focused on 

transferring knowledge in the area of health, safety and environment in the petroleum sector, http://www.icrard.org/
31

conference in 2010.

33 A consensus list of finding and recommendations providing 

guidance for assessing and improving offshore safety was developed by the 200+

attendees at the annual conference. The consensus findings and recommendations of 

the conference, which provide guidance for assessing and improving offshore safety 

programs, are summarized below.34

• Regulatory regimes function most effectively when a single entity has broad 

safety and pollution prevention responsibility. Gaps, overlap, and confusion are 

not in the interest of safety or regulatory efficiency.

• The regulator’s core responsibilities and objectives must be clearly identified.

Managers must minimize distractions so that regulatory personnel can focus on 

these objectives.

• Safety management and regulatory priorities should be identified through a 

comprehensive risk assessment program. Training and competency 

development programs should be updated to reflect the new risk information.

Contracting strategies should be reviewed to assess their safety and risk 

implications.

• Government and industry should promote an improvement mentality, not a 

compliance mentality. Continuous communication among regulators, operators, 

contractors, workers, industry associations and public interest groups is essential 

for continuous improvement.

• Operators and contractors must manage their companies to achieve safety 

objectives and must continually assess the effectiveness of their management 

programs. Regulators should challenge industry to resolve potential safety 

problems rather than seek to resolve the problems for them.

• Regulators should serve as catalysts for learning by distributing information, 

hosting workshops, participating in research, and identifying gaps in standards 

and best practices. Wherever possible, the best standards should be identified 

and applied internationally.

• Accident investigations should be conducted independently and findings should 

be promptly and broadly distributed. Industry or government should maintain 

comprehensive and verified incident data bases. Offshore companies should 

regularly discuss the causes and implications of past accidents with their 

employees.

• Industry and government cannot rely solely on incident data to identify risks.

New indicators must be explored and assessed, particularly for major hazards 

and safety culture. Worker input is also essential.

• Peer-based audit programs should be considered for both regulators and 

operators.

 33 The IRF held a special meeting in September in Herndon, VA to discuss the two blowouts as regulators were seeking 

information from industry and assessing the risks of such an occurrence in their own domains. The second meeting 

was held on October 21, 2010 following the 3rd International Regulators’ Offshore Safety Conference, 18-20 October 

2010 Vancouver, British Columbia, Canada.

34 http://www.irfconference2010.com/showcontent.aspx?MenuID=940
32

• Industry and regulators should make better use of technology for real time 

monitoring of safety parameters.

• Sustaining outstanding safety performance is critical to the reputation of 

industry and government. All personnel should be trained to be safety leaders 

and should be empowered to stop work without blame.

• Industry and government should investigate other actions and programs that 

might help promote, sustain, and monitor a culture of safety achievement.

Following the conference, IRF members met and approved a strategic agenda focusing 

on the following topics35

• Safety culture and leadership;

: 

• Blowout preventer integrity and operational issues;

• Performance indicators;

• Operator competency/capacity criteria; and

• Use of standards and industry best practice.

 35 http://www.irfoffshoresafety.com/conferences/2010conference/communique.aspx