70944 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

DEPARTMENT OF HOMELAND 

SECURITY 

Coast Guard 

33 CFR Parts 140, 143, and 146 

46 CFR Parts 61 and 62 

[Docket No. USCG–2014–0063] 

RIN 1625–AC16 

Requirements for MODUs and Other 

Vessels Conducting Outer Continental 

Shelf Activities With Dynamic 

Positioning Systems 

AGENCY: Coast Guard, DHS. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The Coast Guard proposes to 

establish minimum design, operation, 

training, and manning standards for 

mobile offshore drilling units (MODUs) 

and other vessels using dynamic 

positioning systems to engage in Outer 

Continental Shelf activities. Establishing 

these minimum standards is necessary 

to improve the safety of people and 

property involved in such operations, 

and the protection of the environment 

in which they operate. This notice of 

proposed rulemaking would decrease 

the risk of a loss of position by a 

dynamically-positioned MODU or other 

vessel that could result in a fire, 

explosion, or subsea spill, and supports 

the Coast Guard’s strategic goals of 

maritime safety and protection of 

natural resources. 

DATES: Comments and related material 

must be submitted to the online docket 

via http://www.regulations.gov or reach 

the Docket Management Facility on or 

before February 26, 2015. Comments 

sent to the Office of Management and 

Budget (OMB) on collection of 

information must reach OMB on or 

before February 26, 2015. 

ADDRESSES: Submit comments using one 

of the listed methods, and see 

SUPPLEMENTARY INFORMATION for more 

information on public comments. 

• Online—http://www.regulations.gov 

following Web site instructions. 

• Fax—202–493–2251. 

• Mail or hand delivery—Docket 

Management Facility (M–30), U.S. 

Department of Transportation, West 

Building Ground Floor, Room W12–140, 

1200 New Jersey Avenue SE., 

Washington, DC 20590–0001. Hand 

delivery hours: 9 a.m. to 5 p.m., Monday 

through Friday, except Federal holidays 

(telephone 202–366–9329). 

Collection of Information. Submit any 

comments on the collection of 

information discussed in section VI.D. 

of this preamble both to the Coast 

Guard’s docket and to the Office of 

Information and Regulatory Affairs 

(OIRA) in the White House Office of 

Management and Budget. OIRA 

submissions can use one of the listed 

methods. 

• Email (preferred)—oira_

submission@omb.eop.gov (include the 

docket number and ‘‘Attention: Desk 

Officer for Coast Guard, DHS’’ in the 

subject line of the email). 

• Fax—202–395–6566. 

• Mail—Office of Information and 

Regulatory Affairs, Office of 

Management and Budget, 725 17th 

Street NW., Washington, DC 20503, 

ATTN: Desk Officer, U.S. Coast Guard. 

Viewing material proposed for 

incorporation by reference: Make 

arrangements to view this material by 

calling the Coast Guard’s Office of 

Regulations and Administrative Law at 

202–372–3870 or by emailing HQSSMB-CoastGuardRegulationsLaw@

uscg.mil. 

FOR FURTHER INFORMATION CONTACT: For 

information about this document, call or 

email Lieutenant Jeff Bybee, Coast 

Guard; telephone 202–372–1357, email 

Jeff.B.Bybee@uscg.mil. For information 

about viewing or submitting material to 

the docket, call Cheryl Collins, Program 

Manager, Docket Operations, telephone 

202–366–9826. 

SUPPLEMENTARY INFORMATION: 

Table of Contents for Preamble 

I. Public Participation and Request for 

Comments 

A. Submitting Comments 

B. Viewing Comments and Documents 

C. Privacy Act 

D. Public Meeting 

II. Abbreviations 

III. Basis and Purpose 

A. Basis 

B. Purpose 

IV. Background 

V. Discussion of Proposed Rule 

VI. Incorporation by Reference 

VII. Regulatory Analyses 

A. Regulatory Planning and Review 

B. Small Entities 

C. Assistance for Small Entities 

D. Collection of Information 

E. Federalism 

F. Unfunded Mandates Reform Act 

G. Taking of Private Property 

H. Civil Justice Reform 

I. Protection of Children 

J. Indian Tribal Governments 

K. Energy Effects 

L. Technical Standards 

M. Environment 

I. Public Participation and Request for 

Comments 

We encourage you to submit 

comments (or related material) on this 

rulemaking. We will consider all 

submissions and may adjust our final 

action based on your comments. 

Comments should be marked with 

docket number USCG–2014–0063 and 

should provide a reason for each 

suggestion or recommendation. You 

should provide personal contact 

information so that we can contact you 

if we have questions regarding your 

comments, but please note that all 

comments will be posted to the online 

docket without change and that any 

personal information you include can be 

searchable online (see the Federal 

Register Privacy Act notice regarding 

our public dockets, 73 FR 3316, Jan. 17, 

2008. 

Mailed or hand-delivered comments 

should be in an unbound 81⁄2 x 11 inch 

format suitable for reproduction. The 

Docket Management Facility will 

acknowledge receipt of mailed 

comments if you enclose a stamped, 

self-addressed postcard or envelope 

with your submission. 

Documents mentioned in this notice, 

and all public comments, are in our 

online docket at http://

www.regulations.gov and can be viewed 

by following the Web site’s instructions. 

You can also view the docket at the 

Docket Management Facility (see the 

mailing address under ADDRESSES) 

between 9 a.m. and 5 p.m., Monday 

through Friday, except Federal holidays. 

D. Public Meeting 

We plan to hold a public meeting and 

will announce the time and place in a 

later notice in the Federal Register. 

II. Abbreviations 

ANSI American National Standards 

Institute 

ASOC Activity Specific Operating Criteria 

CAMO Critical Activity Mode of Operation 

DHS Department of Homeland Security 

DP Dynamic Positioning 

DP–1 Equipment class 1 

DP–2 Equipment class 2 

DP–3 Equipment class 3 

DPO Dynamic Positioning Operator 

DPOQ Dynamic Positioning Operator, 

Qualified 

DPSAO Dynamic Positioning System 

Assurance Organization 

DPVAD Dynamic Positioning Verification 

Acceptance Document 

FMEA Failure Modes and Effects Analysis 

FR Federal Register 

GT ITC Gross tonnage as measured under 

46 U.S.C. 14302, Convention Measurement 

System 

IEC International Electrotechnical 

Commission 

IMCA International Marine Contractors 

Association 

IMO International Maritime Organization 

MERPAC Merchant Personnel Advisory 

Committee 

MISLE Marine Information for Safety and 

Law Enforcement 

MODU Mobile Offshore Drilling Unit 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 70945 

1 43 U.S.C. 1333(a) extends the Constitution, laws 

and civil and political jurisdiction of the United 

States to, among other things, all artificial islands, 

and all installations and other devices permanently 

or temporarily attached to the seabed, which may 

be erected thereon for the purpose of exploring for, 

developing, or producing resources therefrom, or 

any such installation or other device (other than a 

ship or vessel) for the purpose of transporting such 

resources. 

2OCS activity is defined in 33 CFR 140.10 to 

mean ‘‘any offshore activity associated with 

exploration for, or development or production of, 

the minerals of the Outer Continental Shelf.’’ 

3As defined in a MODU’s Well Specific 

Operating Criteria (WSOC) or the Activity Specific 

Operating Criteria (ASOC) for a vessel other than a 

MODU. WSOC and ASOC are defined in proposed 

46 CFR 62.10–1. 

4When a MODU performs an emergency 

disconnect from a well during critical activities 

involving hydrocarbon pressure, the Blowout 

Preventer (BOP) is the last line of defense to shut 

in the well and prevent a subsea spill and/or an 

uncontrolled fuel source from potentially feeding a 

fire on the MODU. The potential for failure of the 

BOP was illustrated during the DEEPWATER 

HORIZON casualty. The Coast Guard has received 

multiple voluntary reports of DP system failures 

that caused a loss of position and an emergency 

disconnect, including failures during critical 

activities when the BOP was the only thing 

preventing a catastrophic spill. Because there is no 

mandatory reporting requirement, the Coast Guard 

believes that emergency disconnects during critical 

activities are much more prevalent than indicated 

by voluntary reports. 

5 In one example from voluntary reporting, a 

dynamically-positioned MODU on the U.S. OCS 

suffered a loss of position during critical activities 

while attached to a well in April 2010, and the 

subsea gear was damaged when the MODU 

performed an emergency disconnect. Another 

example occurred in July 2005, when the 

dynamically-positioned logistics vessel SAMUDRA 

SURAKSHA suffered a loss of position while 

attempting a personnel transfer and collided with 

the MUMBAI HIGH NORTH (MHN) platform. The 

collision severed at least one gas riser, causing a 

massive fire that destroyed the MHN platform 

within 2 hours and killed 22 people. 

6For example, in September 2012, the 

dynamically positioned project/construction vessel 

BIBBY TOPAZ suffered a loss of position that 

severed the umbilical of a diver. Similar incidents 

involving the severing of diver umbilicals have 

resulted in diver fatalities. 

7A Critical OCS Activity is defined in 33 CFR 

140.305 of this NPRM, in part, as ‘‘OCS Activities 

where maintaining station is critical because a loss 

of position could cause a personal injury, 

environmental pollution, or catastrophic damage.’’ 

Section 140.305 also contains non-exhasutive lists 

of examples of activities that meet the definitions 

of Critical OCS Activities on a MODU and Critical 

OCS Activities on Vessels Other than MODUs. The 

Coast Guard would provide the DP system industry 

advance notice and an opportunity to provide input 

before determining that additional activities meet 

either of the latter two definitions. 

8Based on teleconferences with industry that 

took place in January 2013. The minutes are 

publicly available at http://www.uscg.mil/hq/cg5/

cg521/. 

MOU Mobile Offshore Units 

MSC Marine Safety Center 

MTS Marine Technology Society 

NOSAC National Offshore Safety Advisory 

Committee 

NPRM Notice of proposed rulemaking 

OCMI Officer in Charge, Marine Inspection 

OCS Outer Continental Shelf 

OCS NCOE Coast Guard Outer Continental 

Shelf National Center of Expertise 

OMB Office of Management and Budget 

OSV Offshore Supply Vessel 

§ Section symbol 

SMS Safety Management System 

STCW Standards for Training Certification 

and Watchkeeping 

U.S.C. United States Code 

VSL Value of a statistical life 

WSOC Well Specific Operating Criteria 

III. Basis and Purpose 

A. Basis 

Several sections of the Outer 

Continental Shelf Lands Act (OCSLA) 

(43 U.S.C. 1331–1356a) provide ‘‘the 

Secretary of the Department in which 

the Coast Guard is operating’’ with 

rulemaking authority. The Secretary’s 

authority under all these sections is 

delegated to the Coast Guard through 

Department of Homeland Security 

Delegation No. 0170.1, paragraph II(90). 

43 U.S.C. 1333(d)(1) gives the 

Secretary ‘‘authority to promulgate and 

enforce such reasonable regulations 

with respect to lights and other warning 

devices, safety equipment, and other 

matters relating to the promotion of 

safety of life and property on the 

artificial islands, installations, and other 

devices referred to in subsection (a) 1 of 

this section or on the waters adjacent 

thereto, as [the Secretary] may deem 

necessary.’’ The Coast Guard interprets 

section 1333(d)(1) as conferring 

authority to regulate any Outer 

Continental Shelf (OCS) vessel or 

facility (collectively referred to as ‘‘OCS 

unit’’) attached to the OCS seabed or 

engaged in OCS activity to support such 

a unit.2

Section 1347(c) requires promulgation 

of ‘‘regulations or standards applying to 

unregulated hazardous working 

conditions related to activities on the 

[OCS] when . . . such regulations or 

standards are [determined to be] 

necessary’’ and authorizes the 

modification ‘‘from time to time’’ of 

‘‘any regulations, interim or final, 

dealing with hazardous working 

conditions on the [OCS].’’ Section 

1348(c) requires promulgation of 

regulations for onsite scheduled or 

unscheduled inspections of OCS 

facilities ‘‘to assure compliance with 

. . . environmental or safety 

regulations.’’ Additionally, section 1356 

calls for regulations requiring, with 

limited exceptions, all OCS units to be 

manned by U.S. citizens or resident 

aliens and to comply with ‘‘such 

minimum standards of design, 

construction, alteration, and repair’’ as 

the Secretary or the Secretary of the 

Interior establishes. 

B. Purpose 

Dynamic Positioning (DP) systems 

typically use computers to automate 

control of vital power and propulsion 

systems to maintain a vessel’s position 

using a position referencing system. 

Mobile offshore drilling units (MODUs) 

engaged in deepwater drilling and 

vessels engaged in other operations that 

require station-keeping adjacent to 

MODUs or production platforms now 

routinely use DP systems for cargo, 

personnel, or fuel transfers where 

conventional mooring is not practical. 

Coast Guard regulations have not kept 

pace with these new technological 

developments. 

A DP incident that results in a loss of 

position 3 on a MODU or other vessel 

engaged in Outer Continental Shelf 

(OCS) activities is a system safety failure 

that may result in serious consequences 

for human safety and the environment 

during certain critical operations. For 

example, a loss of position on a MODU 

during well-control operations could 

result in a subsea spill that is difficult 

to contain.4 A logistics vessel could lose 

position and strike a floating or fixed 

facility, thereby causing damage to the 

gas export riser, which may result in an 

explosion, a loss of life, or an 

environmental event.5 A project/

construction vessel could lose position 

while conducting diving operations, 

risking the lives of the divers.6

To reduce the likelihood of a DP 

incident causing loss of position and the 

resulting consequences, many large 

offshore lease-holding corporations 

require MODUs and other vessels using 

DP systems while performing Critical 

OCS Activities 7 on their leases to meet 

a minimum DP system design standard.8

Additionally, they require these vessels 

to implement operating guidelines and 

employ procedures and decisionsupport tools to ensure the DP system is 

operated within its design limits. They 

also require Dynamic Positioning 

Operators (DPOs) and other essential 

personnel to be well trained. 

We are proposing DP standards for 

MODUs and other vessels that use DP to 

engage in OCS activities because of the 

risks described above; the ongoing trend 

of more operators moving further 

offshore for mineral exploration and 

production; the expanded use of DP, 

which is driven in part by the trend of 

moving operations further offshore and 

resultant mooring challenges; the 

difficulty of responding to incidents 

further offshore, as illustrated by the 

2010 DEEPWATER HORIZON incident; 

the need to update outdated or 

outmoded Coast Guard regulations to 

align with changes in the technology 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
70946 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

9 Memorandum of Agreement Between the 

Minerals Management Service—U.S. Department of 

the Interior and the U.S. Coast Guard—U.S. 

Department of Homeland Security (MMS/USCG 

MOA: OCS–04), dated 28 February 2008, Annex I, 

Items 4.c and 4.d. The Minerals Management 

Service has since been renamed the Bureau of 

Safety and Environmental Enforcement. See also, 

the Memorandum of Understanding Between the 

Bureau of Safety and Environmental Enforcement— 

U.S. Department of the Interior, and the U.S. Coast 

Guard—U.S. Department of Homeland Security, 

dated 27 November 2012. The MOA and MOU are 

available on the docket by following the 

instructions under the ‘‘Viewing comments and 

documents’’ section of this preamble. 

10Watch circles show critical distances between 

the wellhead and the MODU, and are used to define 

when a MODU must take certain actions during a 

loss of position incident to disconnect and separate 

from the BOP without damage to the MODU or 

well, injury to the crew, or an environmental event. 

Watch circles are also used in a similar way by 

vessels other than a MODU to avoid the adverse 

effects of a loss of position. 

11MTS is an international organization 

incorporated in 1963 to give members of academia, 

government and industry a common forum for the 

exchange of information and ideas. Its purpose is 

to promote awareness, understanding, 

advancement, and application of marine 

technology. The MTS Dynamic Positioning 

Committee was established in 1996 to promote a 

greater international understanding of DP and 

related issues, and to provide a forum for the 

exchange of information about technology, training 

and education, improvement of reliability, 

development of guidelines, and other pertinent 

issues to facilitate incident-free DP System 

operations. 

12 ‘‘DP Operations Guidance’’ (Marine 

Technology Society, Part 1, Oct. 2010; Part 2, App. 

1, March 2012; Part 2, App. 2, July 2012; Part 2, 

App. 3, July 2012). These documents are available 

in the docket for this rulemaking by following the 

instructions in the ‘‘Viewing comments and 

documents’’ section of this NPRM.) 

and operations that have transpired 

since these regulations were last 

updated; and the need to establish 

appropriate measures that consistently 

assess DP system capabilities and 

improve DP system reliability for each 

OCS activity. These DP standards 

include operation, design, training, 

manning, and watchkeeping 

components. 

IV. Background 

A. General 

The U.S. Coast Guard, within the U.S. 

Department of Homeland Security, is 

responsible for, among other things, 

protecting the marine environment and 

promoting the safety of life and property 

on the OCS. Under OCSLA, Title 46 

United States Code, 33 CFR chapter I 

subchapter N, and 46 CFR chapter I 

subchapter I–A, the Coast Guard 

regulates OCS facilities, MODUs, and 

other vessels engaged in OCS activities, 

including, but not limited to, tank 

vessels, offshore supply vessels, and 

other vessels involved in OCS activities. 

The Bureau of Safety and 

Environmental Enforcement (BSEE), 

within the U.S. Department of Interior, 

is responsible for managing the nation’s 

gas, oil, and other mineral resources on 

the OCS in a safe and environmentally 

sound manner. Under the OCSLA and 

Title 30 CFR, BSEE regulates activities 

such as oil and gas well exploration, 

drilling, completion, development, 

production and servicing, as well as 

pipeline transportation and storage 

activities under its jurisdiction. BSEE 

also grants rights-of use and easements 

to construct and maintain facilities and 

rights of way for sub-sea pipelines, 

umbilicals and other equipment. Among 

other BSEE regulations applicable to oil, 

gas, and sulfur operations on the OCS, 

30 CFR part 250, subpart S, requires 

covered units to maintain a Safety and 

Environmental Management System, 

and 30 CFR part 250, subpart D, sets 

minimum requirements for blowout 

preventers to reduce the likelihood and 

impact of process safety failures. 

Under a Memorandum of Agreement 9

between the Coast Guard and BSEE, the 

Coast Guard is responsible as the lead 

agency for regulation of DP system 

design, and all aspects of DP system 

operation except criteria for well shutin and disconnect when out of the 

watch circle.10

B. Operation and Design Standards 

We initially addressed DP systems in 

the Coast Guard Eighth District policy 

letter 01–2003, dated January 22, 2003, 

‘‘Use of Dynamic Positioning by 

Offshore Supply Vessels for Oil and 

HAZMAT Transfers’’ (available in the 

docket by following the instructions in 

the ‘‘Viewing comments and 

documents’’ section above). That policy 

letter provided guidance for certain 

Offshore Supply Vessels (OSVs) 

engaged in certain operations in the 

Gulf of Mexico, and is consistent with 

International Maritime Organization 

(IMO) Maritime Safety Committee 

Circular 645 (MSC/Circ.645), 

‘‘Guidelines for Vessels with Dynamic 

Positioning Systems,’’ June 6, 1994, 

which divides DP system equipment 

into classes based on reliability levels 

designated as equipment class 1, 2, or 3. 

Equipment class 1 (DP–1) is the least 

reliable and equipment class 3 (DP–3) is 

the most reliable. 

These DP system equipment classes 

are used today, and IMO MSC/Circ.645 

is the foundation for the proposed 

regulations in this notice. DP system 

technologies and industry experience, 

however, have advanced since IMO 

MSC/Circ.645 was published. 

Consequently, there is a significant 

performance disparity among DP 

systems that have the same equipment 

class rating, because system 

configuration, operational, and 

maintenance decisions may effectively 

degrade DP systems rated as equipment 

class 2 (DP–2) or DP–3 to the extent that 

they perform as if they were rated DP– 

1. For example, degradation can occur 

when an operator of a vessel with a DP– 

2 system chooses to operate with closed 

bus ties and minimize the number of 

generators online in order to save fuel 

and avoid wear and tear on equipment. 

By doing so, the redundancy afforded by 

DP–2 may be compromised. 

To address this performance 

disparity, we propose to incorporate 

IMO MSC/Circ.645 into regulations as 

mandatory provisions. We also propose 

to adopt in regulations DP guidance 

issued by the Marine Technology 

Society (MTS) 11 as mandatory 

provisions to provide owners or 

operators of DP MODUs and other 

vessels essential information on how to 

meet some of the requirements in this 

notice of proposed rulemaking 

(NPRM).12

Additionally, in March 2010, we 

tasked the National Offshore Safety 

Advisory Committee (NOSAC) with 

developing recommendations for DP 

system design, engineering, and 

operation standards. The NOSAC 

provided its recommendations in June 

2010 (available in the docket by 

following the instructions in the 

‘‘Viewing comments and documents’’ 

section above), and we have considered 

them in developing this NPRM. A key 

feature of the NOSAC recommendations 

is the risk-based approach of applying 

higher DP equipment class requirements 

to higher risk operations. As part of its 

recommendations, the NOSAC also 

submitted a draft revision of the DP 

operations guidance developed by MTS. 

This draft guidance, which was issued 

by the Dynamic Positioning Committee 

of the MTS, also linked DP equipment 

class to operations. 

After receiving the MTS draft 

guidelines as part of the NOSAC 

recommendation, we published a draft 

policy letter, ‘‘Dynamically Positioned 

Mobile Offshore Drilling Unit Critical 

Systems, Personnel and Training,’’ in 

the Federal Register on December 29, 

2011 (76 FR 81957). The MTS was 

among those that submitted public 

comment on the draft letter, and we 

participated in several DP conferences 

sponsored by MTS. Also, in a ‘‘Notice 

of Recommended Interim Voluntary 

Guidance’’ published in the Federal 

Register on May 4, 2012 (77 FR 26562), 

we recommended that owners or 

operators of DP MODUs voluntarily 

follow the guidance provided in the 


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Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 70947 

13Throughout this NPRM, references to ‘‘vessels 

other than MODUs’’ that conduct certain activities 

or possess certain design characteristics are 

intended to mean vessels that conduct such 

activities or possess such characteristics and are not 

MODUs. 

14See the discussion of ‘‘Standard DP 

Requirements (Critical OCS Activities)’’ in Section 

V of this preamble. 

15ASOC and WSOC are defined in proposed 46 

CFR 62.10–1 and are similar to the Activity Specific 

Operating Guidelines (ASOG) and Well Specific 

Operating Guidelines (WSOG) in the MTS DP 

Operations Guide. With Coast Guard concurrence, 

the content of the ASOC and WSOC may differ from 

the recommendations in the Operations Guide, and 

vessels would be required by the proposed 

regulations to operate within their ASOC or WSOC. 

16 DEEPWATER HORIZON—FINAL REPORT 

available at https://homeport.uscg.mil/mycg/portal/ 

ep/contentView.do?contentId=323899&pageType

Id=13489&contentType=EDITORIAL. 

MTS DP Operations Guidance (MTS DP 

Operations Guide), Part 2, Appendix 1, 

on MODUs (March 2012). Subsequently, 

we published a follow-up ‘‘Notice of 

Recommended Interim Voluntary 

Guidance’’ in the Federal Register on 

October 12, 2012 (77 FR 62247), which 

recommended that owners or operators 

of DP vessels other than MODUs 13 that 

conduct OCS activities on the U.S. OCS 

follow the 2012 MTS DP Operations 

Guide, Part 2, Appendix 2, on project 

construction vessels (July 2012), or 

Appendix 3, on logistics vessels (July 

2012), as appropriate. 

This NPRM would require new and 

existing MODUs, and new vessels other 

than MODUs, that engage in Critical 

OCS Activities using a DP system, to 

comply with certain provisions of IMO 

MSC/Circ.645 and the MTS DP 

operations guidance documents listed in 

the preceding paragraph.14 These 

documents outline a process for 

determining the design limits of a DP 

system and operating within those 

limits. The MTS DP Operations Guide 

provides guidance on determining a DP 

system’s worst-case failure, which is the 

critical design parameter that drives 

how the system should be operated. The 

worst-case failure is used to determine 

the Critical Activity Mode of Operation 

(CAMO), which is defined in the MTS 

DP Operations Guide and in § 140.305 

of this NPRM. The DP system’s CAMO 

is then incorporated into the Activity 

Specific Operating Criteria (ASOC) or 

Well Specific Operating Criteria 

(WSOC) 15 covering Critical OCS 

Activities; those criteria must clearly 

state when a specific OCS activity is a 

Critical OCS Activity. Operating a DP 

system within an ASOC or WSOC 

appropriate to the specific OCS activity 

and in its CAMO during Critical OCS 

Activities helps ensure that the DP 

vessel is operated within its design 

limits and reduces the likelihood of a 

loss of position. 

In this NPRM, we propose design and 

operational standards for DP systems 

used on MODUs and other vessels. As 

discussed below in Section V of this 

NPRM and depicted in Chart A on page 

33, we structured these proposed 

requirements using a risk-based 

approach tied to the type and size of the 

MODU or other vessel and whether a 

Critical OCS Activity is conducted. We 

are proposing the regulations below 

after considering the NOSAC 

recommendations, the MTS and IMO 

guidance, the current and expected use 

of DP technology, and the risks 

associated with loss of position while 

using DP systems to engage in Critical 

OCS Activities. 

C. Training, Manning and 

Watchkeeping Standards 

The increased use of DP provides 

significant new challenges for the 

operators and crews of MODUs and 

other vessels operating on the U.S. OCS. 

Properly qualified DP system operators 

and on-watch personnel must have an 

in-depth knowledge of these positioning 

systems, be able to constantly and 

consistently monitor them, and, when 

appropriate, take manual control to 

maintain the safety of the vessel, its 

personnel and the environment. 

Casualty investigations and anecdotal 

information regarding near misses due 

to DP failures have highlighted the need 

for regulations that address training, 

manning, and watchkeeping 

requirements in support of DP systems. 

The DEEPWATER HORIZON casualty 

investigation, in particular, highlighted 

DP operational concerns, including 

competence, communications, and 

handling of emergencies, and 

recommended that we develop 

operational requirements for vessels 

fitted with DP.16

We do not yet have any operational 

training standards specifically for DP 

systems, nor do we have manning or 

watchkeeping requirements that take 

into account operations using DP 

systems. Furthermore, the existing 

manning and watchkeeping 

requirements in 46 CFR part 15 apply 

only to U.S. vessels, including MODUs. 

To address these gaps, we propose 

minimum training, watchkeeping, and 

manning standards for U.S. and foreign 

MODUs and other vessels using DP 

systems to engage in OCS activities on 

the U.S. OCS. We developed these 

proposed standards after considering 

internationally accepted standards and 

input from the industry. 

The regulations proposed in this 

NPRM were developed, in part, based 

on the recognition that, under 

applicable law, any MODU or other 

vessel operating solely with a DP system 

is a self-propelled motor vessel and is 

considered to be underway. 46 CFR 

10.107 defines ‘‘self propelled’’ as 

‘‘propelled by machinery’’ and 

‘‘mechanically propelled.’’ 

Additionally, 46 U.S.C. 2101, paragraph 

(16), defines ‘‘motor vessel’’ as ‘‘a vessel 

propelled by machinery other than 

steam.’’ Because any vessel operating 

solely with a DP system is propelled by 

machinery, such vessels are selfpropelled. Similarly, because any vessel 

operating solely with a DP system is 

propelled by machinery other than 

steam, such vessels are motor vessels. 

Further, such vessels are self-propelled 

motor vessels regardless of whether the 

machinery involved is used for the 

vessel to make way (transiting) or to 

maintain a fixed position. 

Self-propelled motor vessels, which 

include MODUs operating solely with a 

DP system, are subject to the Standards 

for Training Certification and 

Watchkeeping (STCW) Convention. 

Under Article III, the STCW Convention 

applies to seafarers serving on board 

seagoing ships, including self-propelled 

MODUs, and existing requirements in 

46 CFR 15.1101 specify that a ‘‘seagoing 

vessel means a self-propelled vessel in 

commercial service that operates 

beyond the Boundary Line established 

by 46 CFR part 7. It does not include a 

vessel that navigates exclusively on 

inland waters.’’ Because MODUs and 

other vessels operating solely with a DP 

system on the U.S. OCS are selfpropelled motor vessels operating 

beyond the Boundary Line, they are 

seagoing ships for purposes of the 

STCW Convention. Consequently, the 

STCW Convention watchkeeping and 

hours of rest provisions and the training 

requirements for personnel standing 

watches apply to mariners serving on 

MODUs and other vessels using a DP 

system to engage in OCS activities on 

the U.S. OCS. 

Additionally, MODUs and other 

vessels operating solely with a DP 

system are considered to be underway. 

‘‘Underway’’ is defined in 46 CFR 

10.107 as— 

A vessel . . . not at anchor, made fast to 

the shore, or aground. When referring to a 

mobile offshore drilling unit (MODU), 

underway means that the MODU is not in an 

on-location or laid-up status and includes 

that period of time when the MODU is 

deploying or recovering its mooring system. 

A vessel operating with DP is 

underway when it is not: At anchor, 

made fast to the shore or ocean bottom, 

aground, or in a laid-up or on-location 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
70948 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

17 46 CFR 10.107 defines ‘‘on-location’’ as ‘‘a 

mobile offshore drilling unit [that] is bottom bearing 

or moored with anchors placed in the drilling 

configuration. 

18 IMO Resolution A.1079(28), para. 2. 

19 Id. at para. 4. This document is available in the 

docket for this rulemaking by following the 

instructions in the ‘‘Viewing comments and 

documents’’ section of this NPRM. 20 IMO Resolution A.1079(28), para. 4. 

status.17 Because MODUs and other 

vessels operating solely with a DP 

system are considered to be underway, 

the regulations in 46 CFR subpart B that 

implement STCW Convention 

watchkeeping and hours of rest 

provisions and the training 

requirements for personnel standing 

watches also apply to mariners serving 

on MODUs and other vessels using a DP 

system to engage in OCS activities on 

the U.S. OCS. 

Further, those regulations are 

consistent with IMO Resolution 

A.1079(28), entitled ‘‘Recommendations 

for the Training and Certification of 

Personnel on Mobile Offshore Units 

(MOUs),’’ and dated December 4, 2013, 

which defines a self-propelled MOU as 

‘‘a MOU fitted with a mechanical means 

of propulsion to navigate 

independently,’’ 18 and specifies that all 

maritime crew members on selfpropelled MOUs should meet the 

requirements of the STCW Convention, 

as amended.19

The 2010 amendments to the STCW 

Convention contain guidance on the 

training, experience, and professional 

competence of personnel who operate 

DP systems. The guidance specifies the 

content of the training such personnel 

should receive and the experience they 

should possess. We considered the 

STCW Convention guidance in 

developing the operational training, 

manning, and watchkeeping standards 

in this NPRM. 

Additionally, in November 2011, we 

tasked the NOSAC with developing 

recommendations for safe standards for 

personnel operating vessels using DP 

systems on the OCS. The NOSAC 

provided its recommendations in 

November 2012 (available in the docket 

by following the instructions in the 

‘‘Viewing comments and documents’’ 

section above). The NOSAC also 

submitted reports containing 

recommended practices for MODUs and 

other vessels operating DP systems on 

the U.S. OCS from each of the three 

main groups of NOSAC stakeholders; 

specifically, the owners or operators of: 

(1) OSVs and small vessels; (2) MODUs; 

and, (3) manned and unmanned barges. 

In March 2012, we tasked the 

Merchant Personnel Advisory 

Committee (MERPAC) with reviewing 

the safe operation of dynamically 

positioned vessels operating on the U.S. 

OCS. MERPAC provided its 

recommendations in September 2012 

(available in the docket by following the 

instructions in the ‘‘Viewing comments 

and documents’’ section above). 

We considered the recommendations 

from both advisory committees in 

developing the training, manning, and 

watchkeeping standards in this NPRM. 

Both committees supported the three 

key recommendations summarized as 

follows: 

Recommendation 1. DPOs should be 

credentialed but not necessarily 

‘‘licensed.’’ If the DPO is not a licensed 

officer, a licensed officer of the 

navigation watch shall be provided, if 

required. 

Recommendation 2. Minimum 

training should meet the standards 

found in the International Marine 

Contractors Association’s ‘‘The Training 

and Experience of Key DP Personnel’’ 

(International Marine Contractors 

Association (IMCA) M 117, Rev. 1, 

February 2006); and IMO Maritime 

Safety Committee Circular 738, 

‘‘Guidelines for Dynamic Positioning 

System (DP) Operator Training’’ (MSC/ 

Circ.738/Rev. 1, July 2006). In addition 

to meeting these training standards, 

further training and/or competency 

assessments should be required to 

ensure the proper performance of 

duties, and should be the responsibility 

of companies based on the DP system, 

vessel type, and service/activities. 

Recommendation 3. Operational 

measures, including DP system and 

crew competency requirements, 

manning, and watch protocols should 

be based on risk assessments performed 

under a Safety Management System 

(SMS). 

We agree with the first 

recommendation that the DPO must be 

a credentialed mariner, but need not be 

licensed. The DPO can also be the 

officer in charge of a navigational watch, 

provided the DP system and the 

navigational equipment are collocated, 

and the person is a qualified DPO who 

also holds the appropriate mate or 

officer endorsement. 

We fully agree with the second 

recommendation. 

Regarding the third recommendation, 

we agree with the adoption of 

operational measures, including the 

risk-based approach to DP system and 

crew competency requirements. 

Additionally, we partially agree with 

the recommendation that manning and 

watch protocols be risk based. Because 

a vessel operating under DP is 

considered to be underway, MODUs and 

other vessels using DP must comply 

with existing laws, regulations, and 

international requirements on manning 

and watchkeeping. However, the 

process to determine watchkeeping and 

manning protocols should account for 

the capabilities and limitations of each 

DP system and the nature of the 

operations of the vessel, including 

MODUs. Manning and watch protocols 

incorporating a risk-based approach 

would improve the safety of navigation 

on the U.S. OCS. 

Regarding the training requirements 

of personnel who stand watch on 

MODUs, we are cognizant that the 

competency requirements in STCW for 

masters and officers in charge of the 

navigational watch may exceed what is 

required for a MODU. The STCW 

Convention, however, already permits 

the issuance of limitations based on 

vessel types after identifying the 

competencies that are not applicable. In 

addition, some flag states already issue 

certificates of competency for masters 

restricted to MODUs that would be 

acceptable for the operation of MODUs 

using a DP system to engage in OCS 

activities on the U.S. OCS. 

The existing training, watchkeeping, 

and hours of rest provisions in 46 CFR 

part 15 applicable to U.S. MODUs and 

other vessels are consistent with STCW 

requirements. Furthermore, foreign 

vessels operating on the U.S. OCS are 

obligated to comply with STCW 

requirements because they are seagoing 

vessels under the STCW Convention. As 

a party to the STCW Convention, we are 

proposing changes in this proposed rule 

to address the gap with respect to the 

application of STCW requirements to 

non-U.S. MODUs using a DP system to 

engage in OCS activities on the U.S. 

OCS by extending the application of the 

Convention requirements to them. 

Application of the STCW provisions 

to these MODUs is consistent with the 

guidance in IMO Resolution A.1079(28), 

‘‘Recommendations for the Training and 

Certification of Personnel on Mobile 

Offshore Units,’’ which specifies that 

crew members on self-propelled mobile 

offshore units should meet the 

requirements of the STCW Convention, 

as amended.20 The Dynamic Positioning 

Operator, Qualified (DPOQ) must have a 

thorough knowledge of the CAMO and 

either the ASOC or WSOC, and must be 

familiar with the vessel’s Failure Modes 

and Effects Analysis (FMEA) so that he 

or she understands the vessel’s 

capabilities and can anticipate the 

vessel’s movements in the event of DP 

system failure or other reduced 

operating capacity. Although we 

recognize that mariners working on 

board MODUs and other vessels should 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 70949 

21 Dynamic Positioning System Assurance 

Organizations are described in § 61.50–3 of this 

NPRM. 

also have additional knowledge and 

understanding of the industrial mission, 

as provided in IMO Resolution 

A.1079(28), such a requirement is 

outside the scope of this rulemaking. 

D. Classification, Plan Review, and 

Certification 

This NPRM proposes to require any 

MODU that uses a DP system to engage 

in Critical OCS Activities, or any other 

vessel that uses a new DP system to 

engage in Critical OCS Activities, to 

obtain a DP notation equivalent to IMO 

MSC/Circ.645 equipment class DP–2 or 

higher from a classification society 

recognized under 46 CFR 8.230. The 

classification society must possess DP 

system rules that are aligned with IMO 

MSC/Circ.645 and meet the 

requirements of proposed 46 CFR 

61.50–3 and the MTS DP Operations 

Guide provisions applicable to the 

vessel being classed. The Coast Guard 

Outer Continental Shelf National Center 

of Expertise (OCS NCOE) would 

determine whether the classification 

society is recognized under 46 CFR 

8.230, whether its DP system rules are 

aligned with IMO MSC/Circ.645 and the 

MTS DP Operations Guide provisions 

applicable to the vessel being classed, 

and whether the notations are 

equivalent to DP–2 or higher. Under 

proposed § 61.50–20, actions of the OCS 

NCOE would be appealable to the U.S. 

Coast Guard Deputy Commandant for 

Prevention. 

Obtaining a classification society 

notation of DP–2 or higher mitigates the 

risk of MODUs and other vessels losing 

position during DP operations on the 

U.S. OCS. A DP–2 notation from a 

classification society serves as a 

fundamental building block for safe DP 

operations by ensuring a minimum level 

of reliability for a DP system, but the 

notation does not consider the mission 

of the vessel, nor does it address 

operations. The MTS DP Operations 

Guide further enhances safe DP 

operations by ensuring the MODU or 

other vessel is operated within the 

design limits of the DP system for the 

industrial mission it must carry out. 

As we discuss further in section V. of 

this preamble, different levels of risk are 

associated with different vessels and 

missions. In general, we are proposing 

a risk-based approach tied to the type of 

vessel and whether the vessel conducts 

Critical OCS Activities. In addition, we 

propose to distinguish between vessels 

other than MODUs based on vessel size. 

For the lower risk category of vessels 

that conduct Critical OCS Activities, 

meeting IMO MSC/Circ.645, obtaining 

surveys from a DP system assurance 

organization (DPSAO), meeting DP 

personnel and system training 

requirements, and following the MTS 

guidance is sufficient to ensure a 

satisfactory safety level. 

Accordingly, we do not propose to 

require such vessels to obtain plan 

review from a DPSAO and obtain a DP 

notation equivalent to IMO MSC/

Circ.645 equipment class DP–2 or 

higher from a classification society for 

the purpose of determining compliance 

with Coast Guard DP requirements. 

Instead, we would rely on the DPSAO 

to verify compliance with the provisions 

of this NPRM and be able to provide 

evidence of this to the Coast Guard 

upon request. 

This NPRM would require more 

oversight on MODUs and other larger 

vessels that use a DP system to engage 

in Critical OCS Activities. These higherrisk vessels would be required to obtain 

plan review and surveys from a 

DPSAO 21 in accordance with § 61.50–3 

of this NPRM. 

To qualify for Coast Guard 

authorization to conduct surveys and 

verify compliance with the provisions 

in this NPRM, a DPSAO must 

demonstrate competency and 

effectiveness in vessel plan review and 

survey. Some of the criteria the Coast 

Guard currently uses to recognize 

classification societies under 46 CFR 

8.230 are also applicable to DP system 

assurance organizations, such as having 

quality systems based on industry 

standards, and financial independence 

from MODU and other vessel owners 

and builders. Additional criteria would 

include a documented history of 

providing FMEA and survey services on 

a wide variety of MODUs and other 

vessels with various industrial missions, 

and a minimum amount of documented 

history of providing high quality, 

effective DP assurance, such as 

recommending enhancements to design 

or operational measures. 

In developing the classification, plan 

review, and certification provisions of 

this NPRM, we consulted with 

organizations that currently conduct DP 

assurance on MODUs and other vessels 

on the U.S. OCS, and leaseholders who 

require MODUs and other vessels with 

which they contract to follow the MTS 

DP Operations Guide. Based on this 

feedback and our experience with 

classification societies and DPSAOs, we 

are proposing criteria for DP system 

assurance organizations that are highly 

qualified in DP system assurance. 

Classification societies and other 

DPSAOs that are highly qualified in DP 

system assurance would need to be 

accepted by the Coast Guard after 

demonstrating they meet our proposed 

criteria. After acceptance by the Coast 

Guard, classification societies and other 

highly qualified organizations would be 

eligible to conduct the DP plan review 

and surveys that would be required on 

MODUs and other large vessels. 

V. Discussion of Proposed Rule 

This NPRM would set standards for 

MODUs and other vessels that use a DP 

system for OCS activities, but would not 

require vessels to be equipped with a DP 

system. These standards would not 

prevent owners or operators from 

choosing to meet a higher standard or 

seeking approval of equivalent safety 

measures. 

In this NPRM, we took potential 

economic impact into consideration by 

phasing in certain vessels, other than 

MODUs, with existing DP systems. We 

also propose a risk-based approach tied 

to the type and size of the MODU or 

other vessel and the category (critical or 

non-critical) of OCS activity the DP 

system is used to conduct. This 

approach is depicted in Chart A. 

BILLING CODE 9110–04–P 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
BILLING CODE 9110–04–C 

The chart depicts five levels of DP 

The requirements would be progressive; 

satisfy depending on the level of risk. 

a DP system for OCS activities must 

that MODUs and other vessels that use 

intermediate, standard, and enhanced) 

requirements (none, minimum, 

requirements as well. 

standard, intermediate, and minimum 

requirements would need to meet the 

to the enhanced DP system 

a MODU or other vessel that is subject 

When developing these proposed 

requirements, we considered the risk- conduct. A similar approach is taken in 

activity the DP system is used to 

classes based on the type of OCS 

4.1, recommends various DP equipment 

Operations Guide, in Part 1 of section 

Operations Guide. The MTS DP 

based approach of the MTS DP 


EP28NO14.000</GPH>tkelley on DSK3SPTVN1PROD with PROPOSALS3

Enhanced DP S

33 CFR 140.345: Plan Re

46 CfR 62.20-2: DP Syst

" MODUs am! other vesse

Using DP System Re-quirements an

system to Yes MODU Critical Yes Intermediate andS!:mda

conduct OCS f---*- Of other v·essel? :: ocs activities on activities? r 

US OCS? Standard DP Sy

No Oiher No 33 CFR 140.340: Des\gn 

vessel 46 CfR 62.40-5: Design 

Yes 46 CFR 62.40-10: DP-2 o

46 CFR 62.25-41l: Enviro

New or Critical Yes Over "' MODUs and other vesse

existing DP r[L_ ocs 6000 System Requirements a

activities? GT!TC? \,. Intermediate DP System 

Existing r 

' 

Intermediate DP 

33 CfR 140.335: Operat

46 CFR 61.50: Survey 46 CFR 62.40-15: FMEA 46 CFR 62.40-2(): FMEA 

Critical OCS activities Yes 46 CFR 62.41l-25: CAMO 

and over 500 GT lTC II !\ * See Table 140.335 33 

GRT ifGT lTC Vessels oth<=r than MOD

not DPSystem Requirement

'\. DPSystem Requirement

Minimum DP S

33 CFR 140.330 J Desig

46 CFR 52.40-3 

33 CFR 140.310: Person33 CFR 140.315: Trainin33 CFR 140.320: Master 33 CFR 140.325: Operat

' - -{ No Re
Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 70951 

section 4.4, which recommends 

different numbers and types of position 

reference sensors based on the OCS 

activity. 

The MTS DP Operations Guide also 

distinguishes between critical and noncritical activities and recommends more 

stringent operational requirements for 

critical activities. The proposed 

regulations reflect the risk-based 

approach in the guide by adjusting the 

DP system reliability standard and level 

of oversight depending on the size of the 

vessel and the OCS activity the MODU 

or other vessel is designed to perform. 

This NPRM would require owners or 

operators of DP MODUs and other 

vessels to follow the MTS DP 

Operations Guide, which provides 

essential information to support 

compliance with some of the 

requirements proposed in this NPRM. 

Primarily, this NPRM would 

distinguish between MODUs and other 

vessels that use DP systems to engage in 

Critical OCS Activities and those that do 

not by requiring higher DP standards 

and more robust oversight for Critical 

OCS Activities. For example, because a 

MODU has a higher risk profile than a 

logistics vessel under the MTS DP 

Operations Guide, this NPRM would 

require a MODU to meet higher DP 

standards and be subject to more robust 

oversight than a logistics vessel. 

This NPRM would also distinguish 

between the sizes of vessels other than 

MODUs that use a DP system for OCS 

activities. A primary risk from such 

vessels is a loss of position that results 

in a collision with another structure. 

The consequences of such a collision 

increase with the size of the vessel. For 

this reason, we propose to require a 

higher DP standard for the largest 

vessels other than MODUs with new DP 

systems, which are those greater than 

6000 GT ITC. 

For the same reason, we also propose 

a phase-in for existing vessels other than 

MODUs, where the largest such vessels 

are required to comply first and the 

smallest—those of 500 GT ITC or less 

(500 GRT if GT ITC not assigned)—are 

required to comply only with the 

minimum DP requirements of this 

NPRM. The NPRM would require 

vessels other than MODUs, greater than 

500 tons but less than 900 tons, 

equipped with existing DP systems, to 

comply with the intermediate 

requirements within 9 years after 

publication of the final rule; vessels of 

at least 900 tons but less than 1900 tons 

to comply within 6 years after 

publication of the final rule; and vessels 

of 1900 tons or more to comply within 

3 years after publication of the final 

rule. The decisions to phase in vessels 

other than MODUs and apply minimum 

requirements to the smallest of them are 

also discussed in the regulatory analysis 

section of this NPRM. Those proposed 

provisions are intended to reduce 

economic impact by providing industry 

time to transition to the new 

requirements. A detailed discussion of 

the top four levels of Chart A follows. 

Minimum DP Requirements (NonCritical OCS Activities) 

This NPRM would require vessels, 

other than MODUs, that use an existing 

DP system to engage in non-critical OCS 

activities or are 500 GT ITC or less to 

meet minimum DP requirements. For 

example, a vessel 500 GT ITC or less 

that uses an existing DP system to 

engage in Critical OCS Activities would 

be required to meet minimum DP 

requirements, as would a vessel greater 

than 500 GT ITC that uses an existing 

DP system to engage in non-critical OCS 

activities. Additionally, vessels, other 

than MODUs, that use a new DP system 

to engage in non-critical OCS activities, 

and MODUs that use a new or existing 

DP system for the same purpose, would 

be required to meet minimum training 

and DP system requirements. There are 

no DP incident reporting requirements 

for MODUs and vessels other than 

MODUs subject to only Minimum DP 

System Requirements. 

Proposed 33 CFR 140.330 and 46 CFR 

62.40–3 would require the DP system 

controls to be designed and operated in 

a manner that reduces the probability of 

adverse events such as a drive-off or 

drift-off after a DP system failure. The 

DP system would be required to be 

equipped with audible and visual 

alarms that notify the DPO of DP system 

failure and independent controls 

immediately available to the DPO that 

function after the failure. 

Proposed 33 CFR 140.315 would 

establish minimum requirements for 

DPO and DPOQ training that ensure 

they are appropriately trained in the use 

and limitations of the DP system. Both 

DPOs and DPOQs would be required to 

be familiar with the CAMO, and either 

the ASOC or WSOC of their MODU or 

other vessel, and to demonstrate a 

fundamental understanding of the 

specific DP system’s FMEA. 

Under proposed § 140.325, MODUs 

and other vessels would be required to 

have a vessel-specific DP system 

operating manual on board and readily 

available to the DPO. Additionally, 

MODUs and vessels conducting vesselto-vessel transfer operations using DP 

systems would need to ensure clear 

communication and appropriate 

emergency preparedness between the 

two vessels, which may have differing 

DP system capabilities and operating 

procedures. 

Intermediate DP Requirements 

In addition to meeting the minimum 

DP requirements described above, 

proposed 33 CFR 140.335 would require 

vessels, other than MODUs, greater than 

500 GT ITC (500 GRT if GT ITC not 

assigned) that use a DP system installed 

before [30 DAYS AFTER DATE OF 

PUBLICATION OF THE FINAL RULE] 

to engage in Critical OCS Activities, to 

develop and adhere to their CAMO and 

ASOC. A Critical OCS Activity is 

defined in proposed 33 CFR 140.305 as 

an activity on the OCS in which the 

accuracy and consistency of the vessel’s 

position is a major factor in the safety 

of personnel, property, and the 

environment. For the reasons stated in 

section III.B. of this preamble, we 

believe that the risk of an injury, 

collision, or spill incident is higher 

when a DP system is used to engage in 

Critical OCS Activities and should be 

subject to a higher safety requirement. 

Additionally, 33 CFR 140.335 would 

require MODUs that use a DP system to 

engage in Critical OCS Activities to 

develop and adhere to their CAMO and 

WSOC. The CAMO, ASOC, and WSOC 

would ensure each DP system is 

operated within its design limits for the 

specific operation. Owners or operators 

would also be required to report DP 

system incidents involving a reactive 

change from ‘‘green’’ to ‘‘yellow’’ or 

‘‘red’’ as defined by the ASOC or WSOC. 

The reporting requirement would apply 

to DP system incidents that occur at any 

time, not just those that occur during 

Critical OCS Activities. 

Proposed 46 CFR 61.50–2 would 

require DP system surveys to be 

completed by a DPSAO. In addition, the 

MODU or vessel owner or operator 

would be required to provide the Coast 

Guard with at least 30 days advance 

notice of these surveys, which would 

enable the Coast Guard oversight 

needed to strike a balance between 

ensuring that third parties are 

adequately performing delegated 

functions on the Coast Guard’s behalf, 

and reducing visits to the vessel by the 

Coast Guard. 

The surveys under proposed 46 CFR 

61.50–5 through 61.50–15 are based on 

those described in IMO MSC/Circ.645 

and the MTS DP Operations Guide, and 

would consist of an initial survey, an 

annual survey that ensures the DP 

system remains in good working order, 

and periodic surveys that fully test all 

systems at least once every 5 years. The 

specific tests to be conducted during the 

surveys and the documentation that 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
70952 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

22 IEC 60092–504, Third Edition 2001–03, 

Electrical Installations in Ships—Part 504: Special 

Features—Control and Instrumentation, Clause 5. 

would be required are discussed in 

detail in proposed part 61 of this NPRM. 

Proposed 46 CFR 61.50–3 creates 

requirements that each DPSAO must 

meet to receive approval from the OCS 

NCOE to conduct the surveys described 

above. These provisions include 

requirements for DPSAOs to produce 

documents showing they have a history 

of providing DP assurance to MODUs 

and vessels other than MODUs, and 

have adequate resources and experience 

that demonstrate they are highly 

qualified to provide DP system 

oversight. 

Proposed 46 CFR 61.50–4 requires an 

annual report to be submitted by each 

DPSAO to the OCS NCOE. The annual 

report must contain each investigation 

summary reported to the DPSAO under 

proposed 33 CFR 140.335(i). The annual 

report would provide valuable feedback 

and allow the Coast Guard to verify that 

the FMEA, WSOC, ASOC and CAMO 

are being updated with lessons learned 

that address the cause(s) of each 

incident, thereby reducing the 

likelihood that future incidents will 

occur. Additionally, the OCS NCOE may 

periodically audit the records of 

DPSAOs to determine whether they are 

continuing to provide the DP system 

oversight necessary to verify that DP 

system are in compliance with the 

applicable requirements of this NPRM. 

Proposed 46 CFR 62.40–15 through 

62.40–25 would require MODUs and 

other vessels to which § 140.335 applies 

to conduct testing based on the FMEA 

to determine the CAMO for the DP 

system. The purpose of the testing is to 

uncover failure modes. For example, 

failure modes that could be transmitted 

through a bus tie should be included in 

the CAMO. For this type of failure 

mode, the CAMO should require 

electrical isolation during Critical OCS 

Activities to prevent the failure from 

resulting in a complete power loss and 

subsequent drift off. 

Compliance with these provisions of 

this NPRM would be documented on 

the Dynamic Positioning Verification 

Acceptance Document (DPVAD) issued 

by a DPSAO under proposed 33 CFR 

140.335. 

Standard DP Requirements (Critical 

OCS Activities) 

In addition to meeting the minimum 

and intermediate DP requirements 

described above, proposed 33 CFR 

140.340 and 46 CFR 62.25–40 and 

62.40–5 would require vessels other 

than MODUs, of 6000 GT ITC or less, 

that use a new DP system to engage in 

Critical OCS Activities, to comply with 

IMO MSC/Circ.645 and the 

environmental type testing provisions of 

International Electrotechnical 

Commission Standard 60092–504 

‘‘Electrical Installation in Ships’’, and 

would require that such vessels meet 

the provisions of the applicable MTS DP 

Operations Guide. Because Critical OCS 

Activities consist of relatively high-risk 

activities, including those where loss of 

position on a vessel could strike the 

production riser of a floating or fixed 

facility, which may result in an 

explosion, a loss of life, and/or an 

environmental event similar in 

magnitude to that of the DEEPWATER 

HORIZON, Critical OCS Activities 

should be subject to a higher safety 

requirement. 

DP systems on these vessels would, at 

a minimum, be required to comply with 

the provisions of IMO MSC/Circ.645 

and the MTS DP Operations Guide 

(incorporated by reference, see § 62.05– 

1) relevant to equipment class 2 (DP–2) 

or higher. The applicable provisions of 

IMO MSC/Circ.645 are the following 

paragraphs: 

1.1 Purpose and Responsibility; 

1.3 Definitions; 

2 Equipment Classes; 

3 Functional Requirements; and 

4 Operational Requirements. 

As discussed in the ‘‘Background’’ 

section above, IMO MSC/Circ.645 and 

the MTS DP Operations Guide contain 

recommendations. Circular 645, 

however, is a mature, performance 

based document with wide industry 

acceptance, and we propose to 

incorporate it into regulations as 

mandatory provisions. The proposed 

regulations would also include a survey 

and certification scheme different from 

that in the Circular. Specifically, we 

propose to require the initial survey to 

include a Failure Modes and Effects 

Analysis (FMEA) proving test, and 

require the Critical Activity Mode of 

Operation (CAMO) to be identified. 

Development of a CAMO and ASOC 

or WSOC would also be required for 

each vessel and well, which have 

different characteristics and risks. 

Because of these differences, the 

proposed regulations cannot prescribe 

in detail the content of these 

documents. Such regulations would be 

extremely lengthy, in a constant state of 

change as DP technology evolves, and 

prone to overbroad misapplication of 

standards that should be tailored to each 

vessel and well. 

Instead, we propose to require that 

owners or operators consult the 

applicable portions of the MTS DP 

Operations Guide as a method of 

drafting these documents and 

complying with the other mandatory 

provisions of the regulations. The MTS 

DP Operations Guide contains 

principles for the development of these 

documents that address the risks 

experienced by today’s modern DP 

vessels. The Guide also contains highly 

useful examples that will be applicable 

to a large majority of vessels and wells. 

We anticipate that the examples in the 

MTS DP Operations Guide will be used 

by industry largely without change. 

However, some vessels will employ 

solutions to obtain DP reliability that 

vary from the examples in the Guide, 

and will have the option to request the 

use of alternative guidance from the 

Coast Guard Office of Design and 

Engineering Standards (Commandant 

(CG–ENG)). Where this occurs, the 

OCMI, the vessel owner or operator, the 

classification society, and the DPSAO 

will apply the relevant principles of the 

MTS DP Operations Guide to ensure the 

ASOC or WSOC and CAMO provide a 

sufficient level of DP reliability to meet 

the DP–2 performance standard in IMO 

MSC/Circ.645, paragraph 2.2.2. 

Owners or operators would also be 

required under proposed 46 CFR 62.40– 

10 to obtain an equivalent class notation 

from a classification society possessing 

DP system rules that are aligned with 

IMO MSC/Circ.645 and meet the 

requirements of proposed 46 CFR 

61.50–3 and the MTS DP Operations 

Guide provisions applicable to the 

vessel being classed. These other vessels 

would also need to meet the 

environmental design requirements of 

proposed 46 CFR 62.25–40. That section 

is modeled after a standard promulgated 

by the International Electrotechnical 

Commission (IEC) to ensure critical 

equipment is appropriately designed to 

withstand the marine environment.22

Enhanced DP Requirements (MODUs 

and New DP Systems on Large Vessels) 

In addition to meeting the minimum, 

intermediate, and standard DP 

requirements described above, proposed 

33 CFR 140.345 and 46 CFR 62.20–2 

would require vessels other than 

MODUs, greater than 6000 GT ITC, that 

use new DP systems to engage in 

Critical OCS Activities, and MODUs 

that conduct Critical OCS Activities, to 

obtain plan review and surveys from a 

DPSAO, which would be subject to 

oversight by the Coast Guard. 

The enhanced DP requirements are 

intended to improve DP designs to 

support the industrial mission of the 

MODU or large vessel, and are necessary 

because, as discussed in the Background 

section of this preamble, a significant 

performance disparity exists in various 


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DP systems rated DP–2. For example, a 

DP–2 system on one vessel could 

consist of a power system with two large 

generators, two switchboards, and a bus 

tie; a DP–2 system on another vessel 

could consist of four smaller generators, 

four switchboards, and four bus ties. All 

other things being equal, a bus failure 

on the first power system would result 

in a 50 percent reduction in power and 

thrust, while a bus failure on the second 

would result in a 25 percent reduction. 

For these reasons, and particularly 

because of the higher risk profile of 

these vessels when they are engaging in 

Critical OCS Activities with a DP 

system, more rigorous safety standards 

are necessary. 

Dynamic Positioning Verification 

Acceptance Document (DPVAD) 

Proposed 33 CFR 140.335 would 

create a new document for vessels other 

than MODUs of at least 500 GT ITC, and 

MODUs that use a DP system to conduct 

Critical OCS Activities. 

A DPVAD would document 

compliance with the requirements of 

this NPRM. This document would need 

to be renewed every 5 years, and would 

be issued by a DPSAO after verifying 

that the vessel has met the applicable 

DP requirements in this NPRM. 

Training 

Operating a DP system requires such 

familiarity with the system that the 

industry and international community 

have developed the term DPO to 

describe a person qualified to operate a 

vessel in DP system mode. This NPRM 

proposes to adopt that term, as well as 

the related concept of a qualified 

trainee, called a DPOQ. Both terms are 

defined in proposed 33 CFR 140.305. 

We propose to require that when 

using a DP system to maintain station, 

a DPO must either operate the DP 

system or supervise a DPOQ who is 

operating the DP system. A DPOQ, if 

present, may operate the DP system if 

the DPO and the vessel’s master have 

endorsed the DPOQ in writing. Both the 

DPO and DPOQ must be mariners 

holding credentials as a rating forming 

part of the navigational watch, able 

seafarer-deck, operational-level deck 

officer, chief mate, master, a rating 

forming part of the engineering watch, 

able seafarer-engine, operational-level 

engineer officer, second engineer, or 

chief engineer, and must have 

completed the applicable DP system 

training set out in proposed 33 CFR 

140.315. 

The training requirements for the DPO 

and DPOQ are based on international 

standards: Section B–V/e of the STCW 

Code; IMCA M 117 Rev.1, ‘‘The 

Training and Experience of Key DP 

Personnel’’; and IMO MSC/Circ. 738, 

‘‘Guidelines for Dynamic Positioning 

System (DP) Operator Training’’. There 

are several training facilities in the 

United States that are certified by the 

Nautical Institute, which has 

established industry-accepted standards 

meeting the IMO and IMCA guidance. 

Mariners who receive the training 

specified in proposed 33 CFR 140.315, 

and familiarize themselves with the 

specific system to be operated on a 

particular vessel, are qualified to 

operate that MODU or other vessel in 

DP mode. 

A DPOQ, by contrast, is a trainee 

qualified to operate a DP system when 

directly supervised by a DPO. The 

DPOQ must complete training that 

provides an introduction to the 

functions and use of a DP system, as 

well as 30 days of training on board any 

DP system-equipped vessel, and must 

demonstrate understanding of the 

specific vessel’s system he or she would 

operate such that the DPO and the 

vessel’s master give written 

endorsements of the DPOQ’s 

qualifications. This training sequence is 

based on IMCA M 117, and is in keeping 

with current industry practices. 

Because DP systems vary widely, 

qualifying as a DPOQ is vessel specific; 

a DPOQ from one vessel would still 

require familiarization to qualify as 

another vessel’s DPOQ. The DPOQ must 

be familiar with the specific vessel’s DP 

system, including the generation, 

distribution, and management of power. 

The DPOQ also must have a thorough 

knowledge of the CAMO and either the 

ASOC or WSOC, and must be familiar 

with the vessel’s FMEA so that he or she 

understands the vessel’s capabilities 

and can anticipate the vessel’s 

movements in the event of DP system 

failure or other reduced operating 

capacity. Although we recognize that 

mariners working on board MODUs and 

other vessels should also have 

additional knowledge and 

understanding of the industrial mission, 

as provided in IMO Resolution 

A.1079(28), ‘‘Recommendations for the 

training and certification of personnel 

on mobile offshore units (MOUs),’’ such 

a requirement is outside the scope of 

this rulemaking. 

All records of training for the DPO 

and DPOQ must be maintained by that 

individual and the owner or operator of 

the vessel. The Coast Guard would 

accept company letters, course 

completion certificates from a training 

institution, letters or course completion 

certificates from the DP system 

manufacturer, or certifications from an 

industry-accepted organization as proof 

that the seafarer received training. 

Manning and Watchkeeping 

We also propose to include a 

definition of DP system in 33 CFR 

140.305 and 46 CFR 62.10.1 to make 

clear that a vessel using a DP system is 

a vessel ‘‘underway.’’ As discussed 

above in the ‘‘Background’’ section of 

this preamble, a vessel using a DP 

system is underway when it is not at 

anchor, made fast to the shore or ocean 

bottom, aground, or in an on-location or 

laid-up status. Clarifying that a vessel 

conducting DP operations is underway 

would ensure that appropriate manning, 

training, certification, and hours of rest 

requirements apply. 

To address the application of the 

STCW Convention to MODUs and other 

vessels using a DP system to engage in 

OCS activities on the U.S. OCS, we 

propose manning requirements in 33 

CFR 140.320 that meet the training, 

certification, and watchkeeping 

provisions of the STCW Convention. 

The specifics of these requirements are 

discussed below. 

We propose a risk-based approach 

using a performance standard in 33 CFR 

140.310 to determine the number of 

DPOs and DPOQs necessary for the safe 

operation of the DP system. The 

performance standard includes 

compliance with STCW hours of rest, 

conditions for the operation with a DPO 

and DPOQ, use of the officer of the 

watch as the DPO, and consideration of 

the nature of the DP operations and the 

DP system. This approach provides the 

flexibility to use different configurations 

when operations or the DP system may 

require additional personnel, in order to 

enhance navigational situational 

awareness. 

To ensure proper navigation and 

adequate operational oversight of DPOs, 

we are proposing a requirement in 33 

CFR 140.320 that any MODU or other 

vessel using a DP to engage in OCS 

activities on the U.S. OCS must be 

under the command of a master and 

maintain navigational watches. 

These proposed requirements are 

necessary for the safety of the vessel and 

its personnel in the event of a loss of 

position that requires the use of manual 

control, and when other navigational 

issues arise that are beyond the duties 

and responsibilities of the DPO. Even 

when maintaining a fixed position using 

a functional DP system, a situation may 

arise, such as avoiding a collision with 

a vessel, that would be outside of the 

scope of a DPO’s training, authority, and 

skill level, and require a qualified 

master and navigational watch. 

Additionally, these proposed 


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requirements are consistent with STCW 

training, certification, and watchkeeping 

provisions, as well as the requirements 

in 46 CFR part 15, that are applicable to 

U.S. MODUs and other vessels. 

To address the concern that the 

requirements in the STCW tables of 

competency for masters and officers in 

charge of the navigational watch exceed 

what is required in these proposed 

regulations for a MODU, the STCW 

Convention permits the issuance of 

limitations based on vessel types after 

identifying the competencies that are 

not applicable. Although the proposed 

requirements do not refer to specific 

STCW regulations or identify the 

appropriate competencies (specifically, 

knowledge, understanding, and 

proficiency) applicable to MODUs, the 

Coast Guard will address any 

differences through the issuance of 

exemptions and limitations to the 

credential in accordance with 46 CFR 

11.301(f). We may also consider 

developing policy to identify any 

differences based on MODU type, if 

appropriate. 

In addition, we propose to include a 

requirement in 33 CFR 140.320 that the 

master and officers meet hours of rest 

requirements in Regulation VIII/1 of the 

International Convention on Standards 

of Training, Certification and 

Watchkeeping for Seafarers, 1978, as 

amended, and Section A–VIII/1 of the 

Seafarers’ Training, Certification and 

Watchkeeping Code. These provisions 

would ensure that the watchkeeping 

personnel and the watches on board 

MODUs and other vessels are arranged 

to protect personnel from impairment 

because of fatigue. These proposed 

requirements are consistent with the 

existing regulations in 46 CFR part 15 as 

applicable to U.S. MODUs and other 

vessels. 

We are also proposing a requirement 

in 33 CFR 140.310 to ensure that the 

DPO and the officer of the watch are in 

direct communications during DP 

system operation. Nothing in this 

NPRM, however, is to be interpreted as 

removing or decreasing the 

responsibility of the master and 

watchstanding officers for the safe 

navigation and operation of the vessel. 

Changes to the authority of the master 

and crew on a MODU, including matters 

relating to a MODU’s industrial mission, 

are outside the scope of this NPRM. 

Lastly, we propose to include a 

requirement in 33 CFR 140.320 that 

each MODU be issued a manning 

document identifying the personnel 

complement necessary to maintain 

watches and meet the hours of rest 

requirements. Furthermore, a provision 

similar to existing 46 CFR 15.520 would 

permit the flag state to also consider the 

specialized nature of each MODU, 

including the limitations and 

capabilities of the DP system, when 

determining the minimum manning 

complement. 

VI. Incorporation by Reference 

Material proposed for incorporation 

by reference appears in 33 CFR 140.7, 

46 CFR 61.03–1, and 46 CFR 62.05–1. 

See ADDRESSES for information on 

viewing this material. Copies of the 

material are available from the sources 

listed in 33 CFR 140.7, 46 CFR 61.03– 

1, and 46 CFR 62.05–1. Before 

publishing a binding rule, we will 

submit this material to the Director of 

the Federal Register for approval of the 

incorporation by reference. 

VII. Regulatory Analyses 

We developed this NPRM after 

considering numerous statutes and 

Executive Orders (E.O.s) related to 

rulemaking. Below, we summarize our 

analyses based on these statutes or 

E.O.s. 

A. Regulatory Planning and Review 

Executive Orders 12866 (‘‘Regulatory 

Planning and Review’’) and 13563 

(‘‘Improving Regulation and Regulatory 

Review’’) direct agencies to assess the 

costs and benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, of 

reducing costs, of harmonizing rules, 

and of promoting flexibility. This NPRM 

is not a significant regulatory action 

under section 3(f) of E.O. 12866. 

Accordingly, this NPRM has not been 

reviewed by the Office of Management 

and Budget. A preliminary Regulatory 

Analysis (RA) discussing costs, benefits, 

and alternatives considered is available 

in the docket by following the 

instructions in the ‘‘Viewing comments 

and documents’’ section of this 

preamble above. 

Table 1 summarizes the impacts of 

this NPRM. 

TABLE 1—SUMMARY OF AFFECTED POPULATION, COSTS, AND BENEFITS

Category Notice of proposed rulemaking 

Applicability ..................................... U.S.- and foreign-flag vessels that use an existing or new DP system. 

Affected population over 10-year 

period.

583 existing OSVs, 53 existing MODUs, and 43 existing crewboats. 

322 future OSVs, 57 future MODUs, and 20 future crewboats. 

Industry Costs (7% discount rate) .. $20.180 million (annualized). 

$141.733 million (10-year). 

Benefits (7% discount rate) ............ Monetized, avoided property damage and loss of production: 

$8.812 million (annualized). 

$61.895 million (10-year). 

Non-quantified: 

Reducing the risk of injuries, loss of life, and environmental damage due to a loss of position resulting from 

a DP failure. 

Breakeven Analysis ........................ One incident of the magnitude of the SAMUDRA SURAKSHA disaster would need to be prevented every 

48 years for the benefits to equal the costs. 

* Please refer to the Regulatory Analysis in the docket for details. 

A summary of the RA follows. 

During interactions with industry at 

National Advisory Committees, DP 

conferences, and industry training 

seminars in DP design and operations, 

industry expressed the need for a 

uniform DP standard from the United 

States as a Coastal State. In response, we 

have developed this NPRM, which 

would provide MODUs and other 

vessels that engage in OCS Activities 

while using a DP system on the U.S. 

OCS a uniform standard that addresses 

design, construction, and operation of 

DP systems. This standard would aid 


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23Of this, 255 future OSVs, 2 future MODUs, and 

16 future crewboats are expected to be U.S.-flag. 

owners or operators in safely meeting 

energy market demands and pursuing 

offshore energy ventures that are farther 

offshore and in deeper waters. 

To minimize the costs to industry, we 

have based our proposed standards and 

requirements on established guidelines 

used by today’s DP industry, 

specifically IMO MSC/Circ.645 and the 

MTS ‘‘DP Operations Guide.’’ We have 

also limited the application of the DP 

system design standards to existing and 

new MODUs, and to new vessels other 

than MODUs (e.g., OSVs and crewboats) 

that engage in Critical OCS Activities 

while using a DP system. Vessels other 

than MODUs, with existing DP systems 

that conduct Critical OCS Activities, 

would be ‘‘grandfathered’’ from 

complying with the DP systems design 

standards, which are the most costly 

requirements of this NPRM, and would 

be permitted to phase-in operating 

standards, such as developing and 

maintaining an FMEA, CAMO, and 

ASOCs, reporting and investigating DP 

incidents, and conducting DP Surveys, 

according to the applicable date listed 

in Table 2. 

TABLE 2—PHASE-IN SCHEDULE FOR VESSELS (EXCEPT MODUS) WITH EXISTING DP SYSTEMS

Tonnage of vessel other than MODU Date requirements effective Number of OSVs and crewboats 

affected 

At least 1,900 GT ITC .................................................. Date of Final Rule + 3 years ....................................... 224 OSVs and 0 Crewboats. 

At least 900 GT ITC ..................................................... Date of Final Rule + 6 years ....................................... 183 OSVs and 0 Crewboats. 

Greater than 500 GT ITC ............................................ Date of Final Rule + 9 years ....................................... 85 OSVs and 1 Crewboat. 

This flexibility in the phase-in 

schedule is expected to minimize costs 

for the population of vessels most likely 

to not be in compliance with the 

provisions of this NPRM by date of 

publication of a final rule. Further, by 

extending the phase-in timeline, we 

have reduced the possibility that DP 

testing providers would be 

overwhelmed by any sudden increase in 

demand for their services. Therefore, 

although a less lengthy phase-in 

schedule would lead to an earlier 

accrual of benefits, it may not lead to 

lower costs overall, if indirect costs 

(such as a lower quality of service, 

longer delays between testings, and 

higher prices in the short-term) are also 

taken into account. 

When properly designed and operated 

within design limits, DP systems 

provide industry with an ability to 

safely maintain position, using these 

rapidly evolving, computerized systems 

to stay within meters of their desired 

location even in the face of wind, wave, 

and current forces. However, these 

systems are not immune from failures 

and, because MODUs and other vessels 

in this industry perform high-hazard 

industrial missions, including drilling 

for oil and gas, conducting personnel 

transfers, and handling large quantities 

of oil and hazardous materials, a loss of 

position could result in an incident with 

significant loss of life or large spill of oil 

or hazardous materials. Establishing 

minimum standards for DP systems 

used to conduct OCS activities would 

promote the safety of people and 

property engaged in such operations. 

While this NPRM would impose no 

carriage requirements nor require use of 

DP, it would require that minimum 

design, operation, manning, personnel, 

and training requirements be met if the 

vessel is using DP. 

This NPRM would also require 

vessels engaged in certain critical 

situations (e.g., transfer of personnel 

and/or hazardous materials) to meet 

DP–2 design standards to ensure that a 

single failure of a primary component 

does not lead to catastrophic 

consequences. 

Additionally, the provisions required 

of MODUs and other vessels engaged in 

Critical OCS Activities enhance the 

capability of a DP system beyond what 

it would achieve by obtaining a DP 

equipment class 2 or 3 notation from a 

classification society with DP rules 

aligned with IMO MSC/Circ.645. The 

enhanced capability enables a MODU or 

other vessel to more safely perform its 

industrial mission because the DP 

system is more fault-tolerant and faultresistant, and has greater capability to 

maintain position after a worst-case 

failure than a vessel operating with DP 

equipment class 1. Further, these 

additional provisions would require 

owners or operators to develop and 

implement operational measures and 

decision-support tools (ASOC or WSOC, 

and CAMO) to operate a DP system 

within its design limits, mitigating the 

severity of a DP system failure in the 

event that one occurred. 

Reason for Coast Guard Action 

MODUs and other vessels that use DP 

to engage in OCS activities that operate 

with lower safety standards may cause 

harm or increased risk of harm to 

human safety and the environment. The 

costs of these lower safety standards 

(increased risk) are not completely 

borne by the OSV or MODU owners or 

operators, so they are external to the 

business decisions of these owners or 

operators. The crew, which may face 

increased risk from lower safety 

standards, may not have any say in 

safety-related decisions. Since the crew 

may be adversely affected by business 

decisions which it may not be able to 

mitigate through increasing its price 

(labor cost), it absorbs the cost of the 

externality (increased risk from lower 

safety standards), which is a market 

failure. Oil spills that result from OSV 

or MODU accidents also impose an 

externality in the forms of 

environmental damage and clean-up 

costs that are not borne directly by the 

OSV and MODU owners. 

Affected Population 

Based on the Coast Guard’s Marine 

Information for Safety and Law 

Enforcement (MISLE) data, we estimate 

that 583 existing OSVs (460 U.S.-flag), 

53 existing MODUs (2 U.S.-flag), and 43 

existing crewboats (42 U.S.-flag) would 

be affected by this NPRM. Using 

historical population data from MISLE, 

we forecast that over the 10-year period 

of this analysis, 322 future OSVs (which 

include OSVs less than 6,000 GT ITC 

and OSVs of at least 6,000 GT ITC), 579 

future MODUs, and 20 future crewboats 

would be affected by this NPRM.23


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24 In year 1, we expect that 585 OSVs less than 

6,000 GT ITC, 25 OSVs of at least 6,000 GT ITC, 

59 MODUs, and 46 crewboats would incur costs as 

a result of this provision. Over the 10-year study, 

1,078 vessels would incur costs. 

25Based on teleconferences with industry that 

took place in January 2013. The minutes are 

publicly available at http://www.uscg.mil/hq/cg5/

cg521/. 

26After examining all applicable vessels’ 

Minimum Safe Manning Certificates, we found only 

six existing U.S. OCS MODUs that would not 

comply with this requirement. All six of these 

MODUs are owned by a single entity and are 

flagged by Liberia, which considers these MODUs 

non-self-propelled. 

27The Coast Guard assumes that these positions 

would operate under current industry practices: A 

master and navigational watch would work a 28- 

day on/off schedule, with each work day consisting 

of an 8-hour shift; the master would then be on call 

for the remainder of the day, while three 

navigational watches would rotate 8-hour shifts 

throughout the day. We also expect that two 

masters and six navigational watches would 

alternate 28-day on/off rotations throughout the 

year in order to keep that MODU operational year 

round. As a result, one crew, which consists of 

three navigational watches and one master, would 

work seven rotations per year, while the other 

group would work six rotations per year. 

28 In year 1, we expect that 12 OSVs under 6,000 

GT ITC, and 2 crewboats would incur costs as a 

result of this provision. Over the 10-year study, 390 

OSVs under 6,000 GT ITC and 14 crewboats would 

incur costs. 

29 During the development of this NPRM, the 

Coast Guard held three roundtable discussions with 

representatives from various industry segments. 

Participants and summaries from these discussions 

are available at http://www.uscg.mil/hq/cg5/ 

cg521/. 

TABLE 3—SUMMARY OF AFFECTED POPULATION

Year 

Future 

OSVs less 

than 6,000 

GT ITC 

Existing 

OSVs less 

than 6,000 

GT ITC 

Phased-in 

OSVs less 

than 6,000 

GT ITC 

Future 

OSVs of at 

least 6,000 

GT ITC 

Existing 

OSVs of at 

least 6,000 

GT ITC 

Phased-in 

OSVs of at 

least 6,000 

GT ITC 

Future 

MODUs 

Existing 

MODUs 

Future 

crewboats 

Existing 

crewboats 

Phased-in 

crewboats 

Base .. .................. 563 .................. .................. 20 .................. .................. 53 .................. 43 ..................

1 ........ 22 .................. 0 5 .................. 0 6 .................. 3 .................. 0 

2 ........ 46 .................. 0 10 .................. 0 14 .................. 6 .................. 0 

3 ........ 54 .................. 0 15 .................. 0 20 .................. 10 .................. 0 

4 ........ 77 .................. 224 20 .................. 20 27 .................. 12 .................. 0 

5 ........ 102 .................. 0 25 .................. 0 33 .................. 14 .................. 0 

6 ........ 128 .................. 0 30 .................. 0 38 .................. 15 .................. 0 

7 ........ 159 .................. 183 35 .................. 0 43 .................. 16 .................. 0 

8 ........ 195 .................. 0 40 .................. 0 48 .................. 17 .................. 0 

9 ........ 233 .................. 0 45 .................. 0 53 .................. 18 .................. 0 

10 ...... 272 .................. 85 50 .................. 0 57 .................. 20 .................. 1 

This NPRM would create design, 

operating, manning, and safety 

standards by adding or amending 

regulations in the following categories: 

Minimum DP System Requirements 

DPO and DPOQ Personnel and 

Training 24 (33 CFR 140.310 and 

140.315)—would establish the 

minimum number of DPOs and DPOQs 

necessary for the safe operation of the 

DP system, as well as minimum training 

and experience requirements that a DPO 

or DPOQ must meet prior to operating 

a DP system on the U.S. OCS. A DPO 

or DPOQ must demonstrate thorough 

knowledge of the vessel’s DP system 

components, operational manuals, and 

the CAMO and ASOC or WSOC. We 

expect no additional cost to be incurred 

by industry as a result of these manning 

requirements and training procedures, 

because industry contracts currently 

require these standards.25 In addition to 

incorporating these standards into this 

NPRM, we would also require company 

letters, course completion certificates 

from a training institution, letters or 

course completion certificates from the 

DP system manufacturer, or certification 

from an industry-accepted organization 

as proof of completion of training 

requirements. We estimate that it would 

cost industry $14.30 per DPO or DPOQ 

to have this documentation made 

available for review by a Coast Guard 

official during an inspection (6 minutes 

× $143.00 per hour). This cost would be 

incurred by an owner or operator each 

time a new DPO/DPOQ is hired. 

DP Manning Requirements (33 CFR 

140.320)—would require all applicable 

MODUs and other vessels using a DP 

system to engage in OCS activities on 

the U.S. OCS to be under the command 

of a master and have an adequate 

number of mates or navigational 

watches to meet the hours of rest 

requirements in Regulation VIII/1 of the 

STCW and Section A–VIII/1 of the 

‘‘Seafarers’ Training, Certification and 

Watchkeeping Code.’’ By providing 

some flexibility in the minimum 

number of required masters and 

navigational watches, we expect that all 

but six vessels would comply with this 

requirement prior to the issuance of a 

final rule in order to compete in 

international markets that already 

require this standard.26 We estimate that 

if a vessel would not have complied 

with this requirement in the absence of 

a final rule, then at most it would incur 

an annual cost of $1,193,920. This 

maximum cost would be incurred if a 

vessel did not meet the minimum 

number of mates and navigational 

watches as required in this proposed 

provision. We estimate that each of the 

six non-compliant MODUs would need 

to hire two new masters and six new 

navigational watches in order to comply 

with the hours of rest requirements in 

STCW.27

Intermediate DP System Requirements 

FMEA and FMEA Proving Test 

Document 28 (33 CFR 140.335, 46 CFR 

62.40–15 and 62.40–20)—would require 

all applicable vessels that use a DP 

system while engaging in Critical OCS 

Activities to complete and maintain an 

FMEA and an FMEA proving test 

document. An FMEA would test a 

vessel’s DP system to establish design 

and operational limits, which could 

then be used to develop a CAMO and 

ASOC or WSOC. With these support 

tools, operators would have criteria for 

deciding when to cease operations to 

prevent a worst-case failure from 

occurring. 

Based on roundtable discussions that 

included a majority of the owners and 

operators of MODUs operating on the 

U.S. OCS,29 we expect that all existing 

and future MODUs would comply with 

this requirement even in the absence of 

this NPRM in order to compete in 

international markets. However, similar 

roundtable discussions with OSV and 

crewboat owners and operators 

indicated that roughly 50 percent of 

current vessels would not be in 

compliance with this proposed 

requirement. Owners and operators of 

OSVs and crewboats further indicated 

that it is likely that a similar percentage 

of future vessels would also not be 

compliant with these proposed 

requirements in the absence of a rule. 

Through statements given by FMEA 

testing providers, we estimate that it 


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30 In year 1, we expect that 15 OSVs, and 2 

crewboats would incur costs as a result of this 

provision. Over the 10-year study, 390 OSVs under 

6,000 GT ITC, 40 OSVs of at least 6,000 GT ITC, 

35 MODUs (only the cost of a CAMO), and 14 

crewboats would incur costs. 

31Based on teleconferences with industry that 

took place in January 2013. The minutes are 

publicly available at http://www.uscg.mil/hq/cg5/

cg521/. 

32 In year 1, we expect that 22 OSVs under 6,000 

GT ITC, 5 OSVs of at least 6,000 GT ITC, 59 

MODUs, and 3 crewboats would incur costs as a 

result of this provision. Over the 10-year study, 764 

OSVs under 6,000 GT ITC, 70 OSVs of at least 6,000 

GT ITC, 110 MODUs, and 21 crewboats would need 

to report DP incidents. 

33These reports can be purchased through the 

IMCA Web site at: http://www.imca-int.com/. 

34According to a Coast Guard Subject Matter 

Expert, it would take an owner or operator 20 

minutes to report a DP status change to a DPSAO— 

which is expected to be done via email, and that 

it would take an employee from the DPSAO an 

additional 20 minutes to read and respond to this 

report. 

35 In year 1, we expect that 12 OSVs under 6,000 

GT ITC, 3 OSVs of at least 6,000 GT ITC, and 3 

crewboats would incur costs to conduct DP 

investigations. Additionally, 22 OSVs under 6,000 

GT ITC, 5 OSVs of at least 6,000 GT ITC, 59 

MODUs, and 3 crewboats would incur costs to 

submit DP investigation reports to the DPSAO 

during the first year. Over the 10-year study, 383 

OSVs under 6,000 GT ITC, 35 OSVs of at least 6,000 

GT ITC, and 21 crewboats would incur costs to 

conduct DP investigations, and 895 OSVs under 

6,000 GT ITC, 70 OSVs of at least 6,000 GT ITC, 

110 MODUs, and 21 crewboats would need to 

submit DP investigation reports. 

36Based on teleconferences with industry that 

took place in January 2013. The minutes are 

publicly available at http://www.uscg.mil/hq/cg5/

cg521/. 

37According to a Coast Guard Subject Matter 

Expert, it would take 10 hours on average for a ship 

engineer employed by the owner or operator to 

conduct a DP incident investigation. 

would cost an owner or operator of a 

OSV or crewboat a one-time payment of 

$275,000 per vessel to comply with this 

proposed requirement. 

CAMO and ASOC or WSOC30 (33 

CFR 140.335)—would require all 

applicable vessels to include in the 

vessel’s DP Operations Manual a 

defined CAMO and, depending on 

whether the vessel is a MODU or vessel 

other than a MODU, a ASOC or WSOC. 

A vessel’s CAMO is developed after 

conducting an FMEA to determine a DP 

system’s worst-case failure. The CAMO 

will tabulate how to configure the 

vessel’s DP system, including power 

generation and distribution, propulsion, 

and position reference systems, so that 

the DP system, as a whole is fault 

tolerant and fault resistant. The vessel’s 

CAMO is then used to develop an ASOC 

or WSOC that will provide criteria on 

the operational, environmental, and 

equipment performance limits 

considered necessary for safe DP system 

operations while operating on a well. 

These tools are supplements to a DP–2 

or higher class system, which would 

further decrease the probability that a 

worst-case failure could occur. 

Based on roundtable discussions with 

MODU owners and operators, all 

existing and future MODUs are expected 

to comply with the requirement that a 

MODU must have a WSOC, although 

only 70 percent of existing and future 

MODUs have—or are expected to 

have—developed a CAMO in the 

absence of this proposed rule.31 Similar 

conversations with owners and 

operators of OSVs and crewboats 

indicated that approximately 50 percent 

of current vessels would not be 

compliant with either of these 

requirements. Owners and operators of 

OSVs and crewboats further indicated 

that it is likely that a similar percentage 

of future vessels would also not be 

compliant with these requirements in 

the absence of a rule. Through 

statements provided by industry, we 

estimate that it would cost an owner or 

operator a one-time payment of $9,120 

per vessel to develop a CAMO and 

ASOC or WSOC simultaneously (160 

hours × $59.00 per hour), or $4,560 to 

develop a CAMO or ASOC or WSOC 

separately (80 hours × $59.00 per hour). 

Report Reactive Change of DP 

Status 32 (33 CFR 140.335)—would 

require all applicable vessels to report to 

an authorized DPSAO any incident in 

which the vessel experiences a reactive 

change of the DP system’s status from 

green to yellow and/or red. Neither the 

Coast Guard nor the IMO or MTS 

currently require vessels that use DP 

systems to report changes in status. The 

Coast Guard reviewed documents 

compiled by the International Marine 

Contractors Association (IMCA), which 

is an international trade association that 

represents offshore, marine, and 

underwater engineering companies. The 

IMCA documents compile Dynamic 

Positioning station-keeping incidents 

voluntarily reported by IMCA members. 

Although the documents do not 

specifically note whether an incident 

results in a change in status (i.e., green 

to red or yellow), IMCA notes that an 

activated red DP alert status would 

classify as an incident. We use the 

IMCA incident rate per vessel as the 

best available data on the change in 

status from green to red. 

Based on a review of IMCA station 

keeping incident reports from 2004 

through 2010 (which is the last year the 

report was available publically), we 

estimated that a vessel would 

experience a reactive change of the DP 

system’s status from green to red an 

average of 1.45 times per year.33 Based 

on subject matter expert input from 

Coast Guard personnel in the Office of 

Design and Engineering Standards, we 

assume that vessels would incur a 

similar number of reactive changes of 

the DP system’s status from green to 

yellow, and therefore estimate that an 

owner or operator would need to report 

an average of 2.90 incidents per year per 

vessel. The rate of DP incidents per 

vessel may decrease over time as a 

result of other requirements in this 

proposal. We assess the impact of the 

decreased incident rate in the Benefits 

section of this document. 

Because this proposed requirement 

would be new, we anticipate creating 

new burdens for industry. We estimate 

that it would cost an owner or operator 

$47.67 per change in DP status to 

comply with this proposed requirement 

(20 minutes × $143 per hour). Further, 

we estimate that it would cost the 

authorized DPSAO $13.67 per change in 

DP status to review and record the 

information, which we assume would 

be passed on to the owner or operator 

through the form of the DPSAO charging 

higher prices for its services (20 minutes 

× $41.00 per hour).34

DP Incident Investigations 35 (33 CFR 

140.335)—would require all applicable 

MODUs and other vessels to conduct a 

DP incident investigation for every 

reported DP status change from green to 

red or yellow, and then to submit a 

summary report of the investigation’s 

findings to the authorized DPSAO. As 

every DP incident would require a DP 

investigation, we estimate that an 

average of 2.90 DP incident 

investigations would need to be 

conducted per year per vessel. 

After conducting roundtable 

discussions with owners and operators 

of MODUs and other vessels, we 

determined that all existing MODUs and 

50 percent of existing OSVs are 

currently conducting DP investigations 

following a DP incident, despite not 

being required to do so.36 Through these 

same roundtable discussions, we 

determined that no owners or operators 

of crewboats currently conduct an 

investigation following a DP incident. 

For owners or operators that do not, or 

would not, conduct a DP incident 

investigation in the absence of a rule, 

we estimate that it would cost $570 per 

DP incident to conduct the investigation 

(10 hours × $57.00 per hour).37

In addition to the costs that would be 

incurred to conduct DP incident 

investigations, all owners or operators 

using DP while conducting Critical OCS 

Activities would experience new costs 

to submit the summary report of the DP 

investigation to the authorized DPSAO. 


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38According to a Coast Guard Subject Matter 

Expert, it would take a ship engineer 2 additional 

hours to write a DP investigation summary and then 

submit it to the DPSAO. Also included in this 

estimate is the time it would take on average to 

make changes to the vessel’s CAMO and ASOCs/

WSOCs. 

39According to a Coast Guard Subject Matter 

Expert, it would take a DPSAO employee 2 hours 

on average to read through the report and respond 

if necessary. 

40 In year 1, we expect that 22 OSVs under 6,000 

GT ITC, 5 OSVs of at least 6,000 GT ITC, 59 

MODUs, and 3 crewboats would incur costs as a 

result of this provision. Over the 10-year study, 764 

OSVs under 6,000 GT ITC, 70 OSVs of at least 6,000 

GT ITC, 110 MODUs, and 21 crewboats would need 

to submit annual DP investigation reports. 

41According to a Coast Guard Subject Matter 

Expert, it would take a DPSAO employee 4 hours 

on average to prepare the Annual DP Incident 

Investigation Report on behalf of the owner or 

operator. 

42 In year 1, we expect that 22 OSVs under 6,000 

GT ITC, 5 OSVs of at least 6,000 GT ITC, 59 

MODUs, and 3 crewboats would incur costs as a 

result of this provision. Over the 10-year study, 764 

OSVs under 6,000 GT ITC, 70 OSVs of at least 6,000 

GT ITC, 110 MODUs, and 21 crewboats would need 

to receive a DPVAD. 

43 In year 1, we expect that 22 OSVs under 6,000 

GT ITC, 5 OSVs of at least 6,000 GT ITC, 59 

MODUs, and 3 crewboats would incur costs as a 

result of this provision. Over the 10-year study, 764 

OSVs under 6,000 GT ITC, 70 OSVs of at least 6,000 

GT ITC, 110 MODUs, and 21 crewboats would need 

to report the time and location of the DP Survey. 

44Based on teleconferences with industry that 

took place in January 2013. The minutes are 

publicly available at http://www.uscg.mil/hq/cg5/

cg521/. 

45According to a Coast Guard Subject Matter 

Expert, it would take a DPSAO employee 6 minutes 

on average to notify the OCMI on the time and 

location of the DP Survey. 

46According to a Coast Guard Subject Matter 

Expert, a DP Survey would take approximately 8 

hours to conduct. 

47 In year 1, we expect that 12 OSVs under 6,000 

GT ITC, and 3 crewboats would incur costs to 

obtain DP–2 class notation. Over the 10-year study, 

143 OSVs under 6,000 GT ITC, and 20 crewboats 

would incur costs as a result of this requirement. 

48We assume that owners and operators of 

MODUs will continue to follow this practice in the 

future. 

As this is a new reporting requirement, 

it is not expected that any of the affected 

population would be compliant with 

this part of the provision in the absence 

of this NPRM. Consequently, we 

estimate that it would cost an owner or 

operator $119.10 per DP incident 

investigation to write the summary 

report and then submit it to the 

authorized DPSAO ((2 hours × $57.00 

per hour) + $5.10 shipping fee).38

Further, we estimate that it would cost 

an authorized DPSAO $82.00 per report 

to review and record the information, 

which we assume would then be passed 

on to the owner or operator through the 

form of the DPSAO charging higher 

prices for its services (2 hours × $41.00 

per hour).39

Annual DP Incident Investigation 

Report 40 (46 CFR 61.50–4)—would 

require a DPSAO to submit an annual 

report containing a summary of each DP 

incident investigation conducted 

throughout the year for all vessels using 

its services. Because this would be a 

new requirement, we anticipate new 

burdens for industry and estimate that 

it would cost an owner or operator 

$169.10 per year to have the DPSAO file 

the annual report ((4 hours × $41.00 per 

hour) + $5.10 shipping fee).41 Further, 

we estimate that it would cost the 

Government $150.00 per report to 

review the information provided and 

respond if necessary (2 hours × $75.00 

per hour). 

Emergency Disconnects and Serious 

Marine Incidents Resulting from a DP 

Status Change from Green to Red (33 

CFR 140.335)—would require all 

applicable vessels to report to the 

cognizant OCMI any incident in which 

the vessel initiates an emergency 

disconnect or experiences a serious 

marine incident (as defined by 46 CFR 

4.03–2) after experiencing a reactive 

change of the DP system’s status from 

green to red. Based on a review of IMCA 

documents from 2004 through 2010, we 

estimated that a vessel would need to 

initiate an emergency disconnect 19 

percent of the time it experiences a DP 

change in status. Further, based on the 

same industry documents, a serious 

marine incident (as defined by 46 CFR 

4.03–2) would occur 5 percent of the 

time a vessel experiences a reactive 

change of the DP system’s status from 

green to red. Because this is a new 

requirement, we anticipate creating new 

burdens for industry. We estimate that 

it would cost an owner or operator 

$47.67 per status change resulting in 

either an emergency disconnect or 

serious marine incident to comply with 

this requirement (20 minutes × $143.00 

per hour). Further, we estimate that it 

would cost the government $25.00 per 

report to review and record the 

information (20 minutes × $75.00 per 

hour). 

Dynamic Positioning Verification and 

Acceptance Document (DPVAD) 42 (33 

CFR 140.335)—would create a new 

document for MODUs and applicable 

vessels, other than MODUs, that use a 

DP system to conduct Critical OCS 

Activities. This document would be 

issued by the authorized DPSAO that 

performed the vessel’s DP surveys, and 

would need to be renewed once every 

5 years. 

According to a Coast Guard Subject 

Matter Expert, it is expected that it 

would take an additional 15 minutes for 

a DPSAO surveyor to complete the 

DPVAD, as the DPVAD would be issued 

by the same DPSAO that conducted the 

vessel’s DP surveys. As a result, we 

estimate that it would cost an owner or 

operator $10.25 once every 5 years to 

comply with this provision (15 minutes 

× $41.00 per hour). 

DP Surveys 43 (46 CFR 61.50–2, 61.50– 

5, 61.50–10, and 61.50–15)—would 

require all applicable vessels to have a 

DPSAO conduct DP system surveys on 

an initial, periodic, and annual basis. 

The organization could be the 

classification society that issues the DP 

notation under 62.40–5, because the 

NPRM would require that the 

classification society issuing the DP 

notation be highly qualified in DP 

system assurance. During the initial 

survey, and again during the periodic 

survey 5 years later, a full FMEA test 

must be performed. Based on roundtable 

discussions with owners and operators 

of MODUs and other vessels, of at least 

6,000 GT ITC, we have determined that 

all existing vessels are currently in 

compliance with this requirement and 

that all future vessels would also be in 

compliance with this requirement.44

However, this provision would also 

require a DPSAO to notify the cognizant 

OCMI at least 30 days in advance of the 

time and location of these DP surveys. 

Because this is a new requirement, we 

anticipate new burdens for industry. We 

estimate that it would cost an owner or 

operator $4.10 per year to comply with 

this requirement (6 minutes × $41.00 

per hour).45 Further, we anticipate that 

the OCMI would be present during most 

DP surveys. However, as we anticipate 

that these surveys would occur in 

conjunction with another Coast Guard 

inspection, the cost incurred by the 

Coast Guard to attend DP surveys would 

be minimized. We estimate that it 

would cost the Government an 

additional $607.50 per survey as a result 

of this NPRM ((6 minutes to record the 

time and location of survey + 8 hours to 

attend the survey) × $75.00 per hour).46

Standard DP System Requirements 

DP System Equipment and Notation 

Requirements 47 (46 CFR 62.40–5)— 

would require all applicable vessels that 

use a DP system while engaging in 

Critical OCS Activities to use, at a 

minimum, a DP–2 class system and to 

obtain, at a minimum, a DP–2 class 

notation. 

Based on vessel specification sheets 

made publicly available by MODU 

owners and operators, all existing 

MODUs comply with this proposed 

requirement, even in the absence of this 

NPRM, in order to compete in 

international markets.48 The same 

cannot be said about vessels other than 

MODUs that use DP, however. After 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 70959 

49Tollefsen, Sveinung. ‘‘DP systems in the OSV 

Industry,’’ May 2010. http://dspace.mit.edu/

bitstream/handle/1721.1/64580/

727052552.pdf?sequence=1. 

50 In year 1, we expect that 5 OSVs of at least 

6,000 GT ITC, and 59 MODUS would incur costs 

to submit their DP system plans to the DPSAO. 

Over the 10-year study, 50 OSVs of at least 6,000 

GT ITC, and 110 MODUs would incur costs as a 

result of this proposed requirement. 

51Based on teleconferences with industry that 

took place in January 2013. The minutes are 

publicly available at http://www.uscg.mil/hq/cg5/

cg521/. 

52According to a Coast Guard Subject Matter 

Expert, it would take 30 minutes for a DPSAO to 

prepare and submit a vessel’s DP system plan to the 

Coast Guard. 

53We document the costs at a 7- and 3-percent 

discount rate as set forth by guidance in the Office 

of Management and Budget’s (OMB) Circular A–4. 

examining existing OSV’s and 

crewboat’s vessel specification sheets, 

we have determined that only 60 

percent of existing OSVs and 70 percent 

of existing crewboats that use DP would 

comply with the DP–2 equipment 

requirement. Because of the mechanical 

and structural demands associated with 

DP–2 systems or higher that are not 

feasible to satisfy in older vessels, the 

Coast Guard proposes to make the 

existing population of OSVs and 

crewboats exempt from the DP–2 

equipment requirements of this NPRM. 

Our research indicates, however, that 

offshore oil and gas entities are starting 

to require that all new, contracted OSVs 

be equipped with DP–2 systems or 

higher.49 This same request is not yet 

being made for all new, contracted 

crewboats though. As a result, we 

estimate that in the years 1 through 3 

following the passage of a final rule, 

one, newly constructed crewboat per 

year would incur costs in order to 

comply with the DP–2 equipment 

requirement. In later years though, all 

crewboats are expected to be equipped 

with a DP–2 classed system even in the 

absence of this proposed rule. 

In addition to determining the 

percentage of existing OSVs and 

crewboats that would comply with the 

equipment standard in this proposed 

rule, we also determined through 

looking at vessel specification sheets 

that only 50 percent of existing OSVs 

and 0 percent of existing crewboats 

would comply with the class notation 

requirement. We have found that 

although this NPRM would grandfather 

certain vessels (other than MODUs) that 

use a DP system installed prior to 

issuance of any rule from this provision, 

owners or operators of OSVs and 

crewboats have pointed out during 

roundtable discussions that it is likely 

that a similar percentage of future 

vessels would also not be compliant 

with this requirement in the absence of 

a proposed rule. 

We estimate that it would cost an 

owner or operator $876,237 per vessel to 

comply with the requirement that a 

vessel using DP to engage in Critical 

OCS Activities must use a DP–2 class 

system or higher, and an additional onetime payment of $64,250 per vessel to 

obtain a DP–2 class notation. 

Enhanced DP System Requirements 

DP System Plans 50 (46 CFR 62.20– 

2)—would require all MODUs and other 

vessels, of at least 6,000 GT ITC, that 

use a DP system installed on or after the 

effective date of a final rule to submit 

their DP system plans to a DPSAO for 

approval. The organization could be the 

classification society that issues the DP 

notation under 62.40–5, because the 

NPRM would require that the 

classification society issuing the DP 

notation be highly qualified in DP 

system assurance. As proposed, these 

plans must include a system 

description, specifications of position 

reference and environmental monitoring 

sensors or systems, the location of 

thrusters and control system 

components, details of the DP system 

monitoring and alarm system, FMEA 

proving test documents and annual 

survey documents, the vessel’s CAMO, 

and the DP system designer’s or 

manufacture’s self-certification of the 

DP system control equipment to the 

environmental design standards. 

Based on roundtable discussions with 

owners and operators of MODUs and 

other vessels, of at least 6,000 GT ITC, 

we have determined that all vessels 

currently would be in compliance with 

this requirement in the absence of a 

rule.51 However, this provision would 

also require the DPSAO to submit the 

plans to the Coast Guard Outer 

Continental Shelf National Center of 

Expertise (OCS NCOE). Because this is 

a new requirement, we anticipate new 

burdens for industry. We estimate that 

it would cost a DPSAO $25.60 ((30 

minutes × $41.00 per hour) + $5.10 

shipping fee) to submit a vessel’s DP 

system plan.52 Further, we estimate that 

it would cost the Government $2,700.00 

(36 hours × $75.00 per hour) to review 

a DP system plan. 

Other 

Dynamic Positioning System 

Assurance Organization Application 

Process (46 CFR 61.50–3 and 62.40–5)— 

would require a DPSAO (for the 

purposes of conducting DP surveys 

under 61.50) to apply to the Coast Guard 

for acceptance to provide these services. 

This provision provides guidelines as to 

who should apply, as well as what 

information the applicant should 

provide in the application. We estimate 

that it would cost a DPSAO $1,235.10 to 

prepare and submit each application 

((30 hours × $41.00 per hour) + $5.10 

shipping fee). Further, we estimate that 

it would cost the Government $600.00 

per application to review each 

document and reach a decision (8 hours 

× $75.00 per hour). 

Request for Comment 

We would appreciate additional 

comments on our cost assumptions, 

including rates of current compliance. 

Information is specifically requested on 

the following: 

(1) Fraction of current MODUs, OSVs 

and crewboats using DP–1, DP–2, or 

DP–3. 

(2) Fraction of newly built MODUs, 

OSVs and crewboats being equipped 

with DP–1, DP–2, or DP–3. 

(3) Frequency of changes in DP status 

from green to red and green to yellow. 

(4) Costs to develop an FMEA and 

WSOC/ASOC. 

(5) Additional cost to equip a newly 

built vessel with DP–2 instead of DP–1. 

Please submit all comments and related 

material according to the instructions 

given in the DATES, ADDRESSES, and 

Public Participation and Request for 

Comments sections of this preamble 

above. 

Costs 

We estimate the total average costs of 

this NPRM to industry for a 10-year 

period as summarized in Table 4.53

TABLE 4—TOTAL INDUSTRY COST OF NPRM 

[Per year] 

Year Undiscounted 

costs 

Discounted costs 

7% 3% 

1 ....................................................................................................................................... $13,295,128 $11,612,479 $12,531,933 


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TABLE 4—TOTAL INDUSTRY COST OF NPRM—Continued 

[Per year] 

Year Undiscounted 

costs 

Discounted costs 

7% 3% 

2 ....................................................................................................................................... 13,583,758 11,864,581 12,803,995 

3 ....................................................................................................................................... 10,900,925 8,898,402 9,975,891 

4 ....................................................................................................................................... 44,460,494 33,918,698 39,502,573 

5 ....................................................................................................................................... 12,960,131 9,240,394 11,179,523 

6 ....................................................................................................................................... 12,958,982 8,635,117 10,852,943 

7 ....................................................................................................................................... 40,540,725 25,246,726 32,963,320 

8 ....................................................................................................................................... 15,177,650 8,833,530 11,981,377 

9 ....................................................................................................................................... 15,965,539 8,684,195 12,236,256 

10 ..................................................................................................................................... 29,112,460 14,799,299 21,662,405 

Total .......................................................................................................................... 208,955,792 141,733,422 175,690,215 

Annualized ....................................................................................................................... ............................ $20,179,651 $20,596,253 

The 10-year discounted present value 

cost to industry of this NPRM is 

approximately $141.733 million 

($73.239 million to domestic owners or 

operators), based on a 7-percent 

discount rate, and $175.690 million 

($91.389 million to domestic owners or 

operators), based on a 3-percent 

discount rate. The annualized cost to 

industry is $20.180 million ($10.428 

million to domestic owners or 

operators), based on a 7-percent 

discount rate, and $20.596 million 

($10.714 million to domestic owners or 

operators), based on a 3-percent 

discount rate. 

Table 5 summarizes the total 10-year 

present value cost to industry of this 

NPRM by risk profile and requirement. 

TABLE 5—TOTAL MARGINAL AND ANNUALIZED INDUSTRY COSTS FOR NPRM BY RISK PROFILE

Requirement 

10-year cost Annualized 

Undiscounted 7% 3% 7% 3% 

Minimum DP Manning Requirements 

Cost to Provide Proof of Training ........................................ $467,996 $332,365 $400,855 $47,321 $46,992 

Cost to Comply with DP Manning Requirements ................ 71,635,200 50,313,567 61,106,279 7,163,520 7,163,520 

Total .............................................................................. 72,103,196 50,645,932 61,507,133 7,210,841 7,210,512 

Intermediate DP System Requirements 

Cost to Complete FMEA and FMEA Proving Test Document .................................................................................. 111,100,000 74,383,054 92,903,263 10,590,474 10,891,097 

Cost to Develop CAMO and ASOC or WSOC .................... 4,208,880 2,858,478 3,540,664 406,983 415,074 

Cost to Report DP Status Changes from Green to Red or 

Yellow ............................................................................... 905,587 565,296 734,721 80,485 86,132 

Cost to Conduct DP Incident Investigations ........................ 6,591,592 4,081,179 5,329,997 581,068 624,838 

Cost to Submit Annual DP Incident Investigation Report ... 860,550 537,146 698,162 76,478 81,846 

Cost to Report Emergency Disconnect and Serious Marine 

Incidents ........................................................................... 28,791 18,548 23,667 2,641 2,774 

Cost to Obtain a DPVAD ..................................................... 14,719 9,594 12,159 1,366 1,425 

Cost to Report DP Surveys ................................................. 20,865 13,024 16,928 1,854 1,984 

Total .............................................................................. 123,730,983 82,466,319 103,259,560 11,741,349 12,105,171 

Standard DP System Requirements 

Cost to Obtain DP–2 System Equipment ............................ 2,628,711 2,299,523 2,478,534 327,400 290,560 

Cost to Obtain DP–2 Class Notation ................................... 10,472,750 7,119,161 8,803,142 1,013,608 1,031,997 

Total .............................................................................. 13,101,461 9,418,684 11,281,676 1,341,009 1,322,557 

Enhanced DP System Requirements 

Cost to Submit DP System Plans ........................................ 4,096 3,222 3,670 459 430 

Total .............................................................................. 4,096 3,222 3,670 459 430 


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We also expect that the Government 

would incur labor costs to review DPO/ 

DPOQ training certificates, annual DP 

investigation reports, notices of 

Emergency Disconnects or Serious 

Marine Incidents that resulted from a 

DP failure, DPSAO applications, and DP 

system plans, as well as to attend DP 

surveys. Table 6 summarizes the 10-year 

costs of this NPRM to the Government. 

TABLE 6—TOTAL GOVERNMENT COST OF NPRM 

[Per year] 

Year Undiscounted 

costs 

Discounted costs 

7% 3% 

1 ....................................................................................................................................... $286,068 $267,353 $277,735 

2 ....................................................................................................................................... 153,180 133,793 144,387 

3 ....................................................................................................................................... 165,220 134,869 151,200 

4 ....................................................................................................................................... 382,700 291,960 340,024 

5 ....................................................................................................................................... 409,808 292,187 353,504 

6 ....................................................................................................................................... 436,068 290,570 365,200 

7 ....................................................................................................................................... 608,143 378,721 494,476 

8 ....................................................................................................................................... 645,120 375,466 509,264 

9 ....................................................................................................................................... 683,585 371,825 523,911 

10 ..................................................................................................................................... 785,380 399,247 584,396 

Total .......................................................................................................................... 4,555,270 2,935,991 3,744,096 

Annualized ....................................................................................................................... 418,019 438,922 

The 10-year discounted present value 

cost to the Government of this NPRM is 

approximately $2.936 million based on 

a 7-percent discount rate, and $3.744 

million based on a 3-percent discount 

rate. The annualized cost to industry is 

approximately $0.418 million, based on 

a 7-percent discount rate, and $0.439 

million, based on a 3-percent discount 

rate. 

Table 7 summarizes, by requirement, 

the total 10-year present value cost of 

this NPRM to the Government. 

TABLE 7—TOTAL MARGINAL AND ANNUALIZED GOVERNMENT COSTS FOR NPRM BY RISK PROFILE

Requirement 

10-Year cost Annualized 

Undiscounted 7% 3% 7% 3% 

Minimum DP Manning Requirements 

Cost to Review Proof of Training ........................................ $245,453 $174,317 $210,238 $24,819 $24,646 

Total .............................................................................. 245,453 174,317 210,238 24,819 24,646 

Intermediate DP System Requirements 

Cost to Review Annual DP Incident Investigation Report ... 763,350 476,475 619,304 67,839 72,601 

Cost to Review Emergency Disconnect and Serious Marine Incidents .................................................................... 15,100 9,728 12,413 1,385 1,455 

Cost to Record and Attend DP Surveys .............................. 3,091,568 1,929,724 2,508,182 274,749 294,035 

Total .............................................................................. 3,870,018 2,415,928 3,139,899 343,974 368,092 

Standard DP System Requirements 

No Cost to Government ....................................................... ........................ ........................ ........................ ........................ ........................

Total .............................................................................. 0 0 0 0 0 

Enhanced DP System Requirements 

Cost to Review DP System Plans ....................................... 432,000 339,849 387,093 48,387 45,379 

Total .............................................................................. 432,000 339,849 387,093 48,387 45,379 

Other Requirements 

Cost to Review DPSAO Applications .................................. 7,800 5,523 6,866 786 805 

Total .............................................................................. 7,800 5,523 6,866 786 805 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
70962 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

We estimate that the combined total 

10-year present value cost of this NPRM 

to industry and Government is $144.669 

million ($74.991 million for domestic 

owners or operators), discounted at 7 

percent, and $179.434 million ($93.665 

million for domestic owners or 

operators), discounted at 3 percent. We 

estimate that the combined annualized 

cost to industry and government is 

$20.598 million ($10.677 million for 

domestic owners or operators), based on 

a 7-percent discount rate, and $21.035 

million ($10.980 million for domestic 

owners or operators), based on a 3- 

percent discount rate. 

Table 8 summarizes the combined 10- 

year cost of this NPRM to industry and 

the Government. 

TABLE 8—TOTAL COST OF NPRM 

[Per year] 

Year Undiscounted 

costs 

Discounted costs 

7% 3% 

1 ....................................................................................................................................... 13,581,195 11,879,832 12,809,668 

2 ....................................................................................................................................... 13,736,938 11,998,374 12,948,382 

3 ....................................................................................................................................... 11,066,145 9,033,271 10,127,091 

4 ....................................................................................................................................... 44,843,194 34,210,658 39,842,597 

5 ....................................................................................................................................... 13,369,939 9,532,582 11,533,027 

6 ....................................................................................................................................... 13,395,049 8,925,687 11,218,143 

7 ....................................................................................................................................... 41,148,868 25,625,447 33,457,795 

8 ....................................................................................................................................... 15,822,770 9,208,996 12,490,640 

9 ....................................................................................................................................... 16,649,124 9,056,020 12,760,167 

10 ..................................................................................................................................... 29,897,840 15,198,546 22,246,801 

Total .......................................................................................................................... 213,511,062 144,669,412 179,434,311 

Annualized ....................................................................................................................... 20,597,670 21,035,175 

Benefits 

As offshore drilling industry 

operations move farther offshore, 

maintaining vessel position and height 

becomes an increasingly more difficult 

task, especially as water depth 

precludes mooring. The vessel’s 

position and height depend on an 

understanding of many variables, such 

as the speed and direction of waves and 

the wind, both of which can be very 

irregular at distances farther offshore. 

DP systems not only remove this 

uncertainty, they can also predict future 

changes in wave speed and direction 

based on current conditions. 

However, despite this advanced 

technology (and in some cases, because 

of this technology) a loss of position can 

still occur while operating under DP. 

Due to the high-risk environment that 

OSVs and MODUs work in, such a loss 

of position could result in catastrophic 

consequences. Property damage, 

environmental damages, and human 

casualties could occur in the event of a 

loss of position or propulsion. 

Table 9 presents the range of potential 

consequences at risk in the event of a 

DP loss of position or propulsion on a 

MODU, OSV, or crewboat. 

TABLE 9—POTENTIAL MONETARY CONSEQUENCES AT RISK THAT COULD RESULT FROM A DP SYSTEM LOSS OF POSITION

Consequence category Range of potential consequences 

Property Damage from Collision ......................................................................................................... $5 million to $1 billion. 

Environmental Pollution ....................................................................................................................... $5 million to $500 million. 

Riser Lost on Seabed .......................................................................................................................... $7 million to $70 million. 

Pipe Bent or Buckled ........................................................................................................................... $3 million to $30 million. 

Downtime from Production .................................................................................................................. Up to $500 thousand per day. 

Loss of Life .......................................................................................................................................... $9.1 million per statistical life. 

At this time, the Coast Guard does not 

have a comprehensive source of 

information on changes in DP status and 

the resulting loss of position incidents, 

as vessels of all types currently do not 

have to report DP failures to the Coast 

Guard. A provision of this NPRM seeks 

to gather this data. 

The following incidents illustrate the 

potential consequences at risk if a 

position is lost during DP operations. In 

April 2010, the MODU DISCOVERER 

CLEAR LEADER experienced a DP 

system failure that resulted in a loss of 

position while conducting well control 

operations on the U.S. OCS. During the 

incident, the DPO was able to initiate a 

cease operations response, however, an 

emergency disconnect was required. 

Although the MODU’s blow-out 

preventer was able to prevent a spill 

that could potentially have been on the 

magnitude of the DEEPWATER 

HORIZON incident, the subsea gear of 

the MODU suffered damages as a result 

of the MODU’s loss of position. The 

Coast Guard’s MISLE database lists 

property damages of $760,000 as a result 

of this incident. Further, the vessel 

experienced a loss of revenue during the 

time when its operations were 

suspended. 

In September 2012, a DP incident 

involving the construction OSV BIBBY 

TOPAZ occurred off the coast of 

Scotland. During dive support activities, 

the BIBBY TOPAZ suffered a DP system 

failure that resulted in a loss of position. 

At the time of the incident, three divers 

were in the water, and when the vessel 

experienced a loss of position, the 

umbilical cord of one of the divers was 

severed. The diver was unable to return 

to the diving bell and had to instead rely 

on his standby air tank for almost 40 

minutes. When the rescue team found 

the diver, he was unconscious, although 

the team was able to revive him. While 


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54The vessel was equipped with DP but was not 

operating under DP at the time of the loss of 

position. 

55Because this information was voluntarily 

provided to the IMCA, the reporting population 

may not be representative of the population as a 

whole. However, as the IMCA is the only 

organization that currently collects this data, it is 

the best data available at this time. 

this incident did not result in any 

fatalities, the vessel’s loss of position 

put the lives of three divers at risk. The 

VSL of the lives that could have been 

lost as a result of this incident is 

$27,300,000. Although this incident did 

not take place in U.S. waters, dive 

support activities while operating under 

DP are regularly conducted on the U.S. 

OCS, with similar consequences at risk. 

Neither of these incidents capture 

fully the potential worst-case 

consequences of a loss of position that 

results from a collision under power of 

a MODU, OSV, or crewboat. The allision 

of the logistics OSV SAMUDRA 

SURAKSHA with a drilling platform 

illustrates the types and potential 

magnitude of worst-case consequences 

that could result from an OSV loss of 

position. In July 2005, the SAMUDRA 

SURAKSHA was transferring personnel 

off the coast of India when the vessel 

experienced a loss of position 54 and 

collided with a platform, severing a gas 

riser in the process. Although an 

emergency shut-off of the gas riser was 

initiated, gas was released, resulting in 

an explosion and massive fire. Twentytwo crewmen lost their lives or went 

missing as a result of the explosion, 

which, when monetized at $9,100,000, 

amounts to $200,200,000. We use the 

fatalities as a reasonable worst-case 

scenario of the potential consequences 

at risk from a loss of position and 

resulting collision between vessels or 

platforms. The incident also had 

environmental damage, property 

damage and loss of production impacts. 

This NPRM mitigates the risk of a DP 

loss of position in several ways. This 

NPRM provides other guidance on 

design and operation standards for all 

DP vessels. The development of 

decision support tools such as CAMOs 

and ASOC or WSOC would provide 

DPOs and DPOQs with a summarized 

and easy to understand guide on the 

limits to safe operating conditions, 

which would help DPOs and DPOQs 

react quicker to prevent or mitigate a 

loss of position while operating DP 

systems. 

Furthermore, requiring owners or 

operators of vessels using DP systems to 

examine DP failures and submit 

documents describing the time, 

location, and reason for why a system 

failure occurred will enable industry 

and the Coast Guard to better 

understand the causes of these failures 

and, in time, develop programs to 

prevent these same failures from 

occurring in the future. Additionally, 

this information can provide assistance 

to manufacturers and operators of DP 

systems in order to contribute to more 

efficient and safer DP systems and 

practices in the future. 

To better understand how many DP 

system incidents occur per year, we 

reviewed reports from the International 

Marine Contractors Association (IMCA), 

which collects and reports incidents of 

DP station-keeping incidents provided 

on a voluntary basis by its members. 

From 2004 through 2010, the IMCA lists 

429 reported DP system incidents. 

However, this figure likely 

underestimates the number of DP 

system incidents that occurred because 

during that time period, members of the 

IMCA were not required to report 

station-keeping incidents. As a result of 

this under-reporting, we use the average 

rate per year at which DP system 

incidents occurred per vessel during 

that same time period, instead of the 

average number of DP incidents 

reported per year, since the rate is less 

likely to be influenced by the number of 

vessels reporting. Figure 1 displays the 

trend in the number of DP incidents 

reported to the IMCA from 2004 through 

2010. 

Although reporting to the IMCA is 

voluntary, and therefore may not 

represent the true population mean of 

the entire affected population’s DP 

incident rate, the IMCA data show that 

the rate of DP system incidents has 

remained relatively stable throughout 

the 7-year period studied, even as the 

number of vessels reporting has 

increased.55 This suggests that DP 

system incidents occur on a relatively 


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70964 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

56 International Marine Contractors Association. 

‘‘Dynamic Positioning Station Keeping Incidents: 

Incidents reported for 2008 (DP system 19)’’. Pg. 2. 

57 International Marine Contractors Association. 

‘‘Guidance on Operational Activity Planning’’. 

November 2012. Pg. 9. 

58 IMCA. ‘‘Guidance on Operational Activity 

Planning’’. November 2012. Pg. 11. 

consistent basis (one to two times per 

vessel per year). 

The IMCA’s report then categorizes 

the cause of each DP system incident 

that was reported as the fault of either: 

Environmental force, power/thrust 

equipment, DP equipment, or operator 

error. Figure 2 summarizes the 

categories as a percentage of the total 

number of DP system incidents that 

occurred from 2004 through 2010 (429 

total). 

Although Figure 2 shows that only 13 

percent of all DP system incidents are 

directly linked to operator error, nearly 

94 percent could have been mitigated by 

attention to human factors— 

environmental faults could have been 

reduced through the development of a 

well defined ASOC or WSOC, power/

thrust faults could have been mitigated 

through the development of a properly 

defined CAMO, DP system faults could 

have been reduced through the 

development of a well defined ASOC or 

WSOC, and operator faults could have 

been diminished through DPOs and 

DPOQs becoming more familiar and 

experienced with a vessel’s ASOC or 

WSOC.56

With regard to the nonhuman, factorrelated elements of this NPRM, DP 

system incidents resulting from power 

generation or thrust faults could have 

been mitigated through the redundancy 

provided by DP–2, and by developing 

and maintaining a vessel’s CAMO. A 

CAMO would ‘‘identify the equipment 

configuration and methods of operation 

that ensure the vessel meets its 

maximum level of redundancy, 

functionality and operation and that no 

single fault will exceed the identified 

worst case failure.’’ 57 Additionally, a 

CAMO would define the most robust 

configuration for the vessel’s power 

plant set-up, thrusters, power 

management, etc., thereby diminishing 

the likelihood that an incident could 

occur as a result of human negligence in 

designing the vessel’s operating 

systems. 

Furthermore, the development and 

maintenance of an ASOC or WSOC 

could reduce the probability that a DP 

system incident occurs as a result of a 

DP reference or DP computer fault. The 

ASOC or WSOC would define, among 

other things, ‘‘maximum environmental 

operating conditions, maximum offsets 

permissible from the set point position, 

position reference systems, and 

auxiliary systems performance limits 

and failures.’’ 58 These guidelines would 

program the DP computer to signal to 

the DPO or DPOQ to cease operations 

whenever the vessel diverged from the 

maximum limits set in the ASOC or 

WSOC. 

While the majority of DP system 

incidents are correctly identified and 

resolved through the DPO or DPOQ 

manually taking control of the system, 

inaction or delayed action can have 

immense consequences. If left 

unchecked, a DP incident could result 

in a loss of position or propulsion, a 

short circuit of the electrical equipment, 

and/or an emergency disconnect. These 

events could result in major property 

damage to the vessel and/or any 

surrounding vessels and facilities, lost 

revenue as a result of any downtime 

caused by damages, injury or loss of life, 

and/or environmental damage as a 

result of released oil or other chemicals. 

Table 10 provides greater detail on 

how each NPRM provision supports one 

of the four below categories: 

• Design Standards and 

Classification; 

• Operations; 

• Manning and Training; and 

• Reporting. 


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TABLE 10—DESCRIPTION OF BENEFITS OF THE NPRM 

Key provision 

Design 

standards & 

classification 

Operations Manning 

& training Reporting Description How provision reduces risk 

33 CFR Part 140—Navigation and Navigable Waters 

140.310 DP system personnel requirements..................... ................... ................ ................ Requires all vessels that 

use a DP system to conduct OCS activities to 

have a DPO or DPOQ 

who is properly trained 

and has no other responsibilities outside of DP.

Codifies industry standards that each 

DPO and DPOQ must follow while 

performing duties, which reduces 

the likelihood of casualties occurring from operator fatigue, inattention or inexperience. 

140.315 Minimum 

DP system training requirements.

.................... ................... ................ ................ Defines the minimum training requirements that 

each DPO and DPOQ 

must have before operating a DP system.

Codifies industry standards that each 

DPO and DPOQ must follow while 

performing duties, which reduces 

the likelihood of casualties occurring from inexperience. 

Requires owners or operators to make available 

their DPO’s or DPOQ’s 

course completion certificates for DP training.

Enables compliance verification for 

this critical area to ensure that 

each DPO and DPOQ has received 

the proper training and has the 

necessary experience required to 

correctly operate a DP system in 

routine and emergency operations. 

140.320 DP system Manning requirements..................... ................... ................ ................ Defines the minimum manning requirements to 

which all MODUs must 

adhere while using DP to 

conduct OCS activities.

Codifies industry standards that each 

DPO and DPOQ must follow while 

performing duties. Ensures that 

each DPO and DPOQ is sufficiently 

rested and prepared to handle the 

challenges of operating a DP system. Ensures that each DPO or 

DPOQ is in direct communication 

with a licensed master and navigational watch at all times while a 

MODU is using dynamic positioning 

to conduct OCS activities, enabling 

correct actions for routine and 

emergency situations and thus reduce the likelihood of casualties occurring from personnel 

miscommunication. 

140.325 Operations..................... ................... ................ ................ Requires all vessels that 

use a DP system to conduct OCS activities to 

meet the DP Operation 

Standards in paragraph 

4.4 IMO MSC/Circ. 645.

Provides a uniform operating standard to which all flag DP vessels 

must adhere. This would reduce 

the probability of operator faults occurring as a result of a lack of familiarity or experience with a DP 

operating system. 

140.330 Minimum 

design standards 

and testing.

.................... ................... ................ ................ Requires all vessels that 

use a DP system to conduct OCS activities to 

meet the DP Design 

Standards in paragraph 

3.4.1 of IMO MSC/Circ. 

645.

Provides design standards to ensure 

a fault tolerant, fault resistant DP 

vessel that minimizes risk of loss of 

position if one component fails. 

140.335 Intermediate DP system requirements..................... ................... ................ ................ Requires all applicable vessels to conduct vessel 

surveys and maintain an 

FMEA, FMEA proving test 

document, and a CAMO.

Ensures that specifics of system design, construction and operation 

are developed and tested to ensure 

that redundancy is actually 

achieved and systems function as 

intended. 


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70966 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

TABLE 10—DESCRIPTION OF BENEFITS OF THE NPRM—Continued 

Key provision 

Design 

standards & 

classification 

Operations Manning 

& training Reporting Description How provision reduces risk 

In addition to meeting the 

minimum DP Operating 

Requirements, all MODUs 

and applicable non-drilling 

vessels must also maintain a CAMO and ASOC 

or WSOC, respectively, 

as described in the MTS 

DP Operation Guidelines.

Ensures that all vessels and MODUs 

have well documented course-ofaction and DP incident emergency 

response plans for all OCS activities. Reduces the probability that 

significant casualties or property 

damage could occur, since the DP 

system would be programmed, following rigorous testing during the 

FMEA, to recognize maximum environmental conditions, maximum offsets permissible from the set position, position reference systems, 

and auxiliary systems. 

All applicable vessels must 

report a DP system status 

change from green to red 

or yellow to a DPSAO.

Provides Coast Guard officials with 

information on how often DP station-keeping incidents occur and 

why, and enables the Coast Guard 

to ensure that operations can be 

resumed safely. 

All applicable vessels must 

conduct a DP investigation whenever the DP status changes from green 

to yellow or red and submit a summary from the 

investigation to the 

DPSAO indicating whether the cause of the DP incident was addressed in 

the vessel’s FMEA, 

CAMO, and ASOC or 

WSOC.

Ensures that FMEAs, CAMOs, and 

ASOC or WSOC are updated 

based on casualties to prevent 

similar DP incidents from occurring 

in the future. This would reduce the 

probability that significant casualties or property damage could 

occur in the future. 

All applicable vessels must 

have the DPSAO complete an annual DP incident investigation report. 

This report would be reviewed annually by the 

OCS NCOE.

Provides Coast Guard officials with 

information on how and why DP 

failures occur. This information provides valuable feedback to ensure 

that future such incidents do not 

occur, which would reduce the 

probability of significant casualties 

or property damage from occurring 

in the future. 

All applicable vessels must 

report a DP incident that 

resulted in an emergency 

disconnect and/or serious 

marine incident to the 

cognizant OCMI.

Ensures that the Coast Guard is notified immediately of DP incidents 

that result in catastrophic damages 

and/or injuries and fatalities. This 

would allow the Coast Guard to 

take immediate action if a serious 

event occurred, and to ensure that 

operations are not resumed until 

the cause of the incident has been 

addressed. 

Creates a new document, a 

DPVAD, which would be 

issued by DPSAO to 

MODUs and applicable 

vessels other than 

MODUs that use a DP 

system while conducting 

Critical OCS Activities. 

This document would be 

issued after the vessel 

has completed its DP surveys.

Ensures safe design and operation 

for all vessels that use a DP system while conducting Critical OCS 

Activities. Ensures that FMEA and 

CAMO are developed and maintained, which would reduce the 

likelihood of significant casualties 

or property damage from occurring 

in the future. 


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TABLE 10—DESCRIPTION OF BENEFITS OF THE NPRM—Continued 

Key provision 

Design 

standards & 

classification 

Operations Manning 

& training Reporting Description How provision reduces risk 

140.340 Standard 

DP system requirements.

.................... ................... ................ ................ Requires all applicable vessels to obtain DP notation 

equivalent to Equipment 

class 2 or higher from an 

authorized classification 

society.

Reduces probability of a DP system 

failure occurring by adding second 

component that would be required 

to fail before system failure. 

140.345 Enhanced DP system requirements..................... ................... ................ ................ In addition to meeting the 

design and operating requirements found in 

140.335 and 140.340, all 

MODUs and new vessels 

other than MODUs of at 

least 6,000 GT ITC must 

also submit, and have approved, the vessel’s design and operating plans 

by the DPSAO that conducted the vessel’s initial 

survey.

Provides increased assuredness of 

safe design and operation for all 

vessels that use a DP system to 

conduct Critical OCS Activities by 

requiring independent third party 

verification of design and planned 

operations. Ensures that FMEA and 

CAMO are developed and maintained, which would reduce the 

likelihood of significant casualties 

or property damage from occurring 

in the future. 

140.350 Operational control..................... ................... ................ ................ Permits the cognizant OCMI 

to suspend an applicable 

vessel from using DP, if 

the vessel is found to be 

not in compliance with the 

requirements in this part.

Ensures safe design and operation 

for all vessels that use a DP system while conducting Critical OCS 

Activities. This will reduce the likelihood of significant casualties or 

property damage from occurring in 

the future. 

46 CFR Part 61—Periodic Tests and Inspections 

61.50–2 Surveys .................... ................... ................ ................ Requires all MODUs and 

applicable vessels other 

than MODUs that use a 

DP system while conducting Critical OCS Activities, to complete DP 

surveys conducted by a 

DPSAO.

Ensures safe design and operation 

for all vessels that use a DP system to conduct Critical OCS Activities by requiring independent evaluation of systems. Periodic surveys 

ensure that FMEA and CAMO are 

maintained, which would reduce 

the likelihood of significant casualties or property damage from occurring in the future. 

Requires the DPSAO conducting the vessel’s DP 

survey to notify the OMCI 

at least 30 days prior to 

the survey.

Allows Coast Guard officials the opportunity to participate in DP system surveys providing government 

oversight and quality control for 

third parties. The Coast Guards 

presence will verify and complement the findings of a third-party 

surveyor, thereby ensuring that DP 

system equipment is operational 

and properly maintained, which 

would reduce the likelihood of a 

loss of position occurring in the future. 

61.50–3 Acceptance of dynamic 

positioning system assurance 

organizations.

.................... ................... ................ ................ Creates specifications that 

DPSAO must meet in 

order to receive approval 

from the Coast Guard 

Outer Continental Shelf 

National Center of Expertise (OCS NCOE) to conduct DP surveys, FMEA 

testing, and plan reviews.

Ensures that DPSAOs are highly 

qualified at conducting an FMEA, 

testing a vessel’s CAMO and 

ASOC or WSOC, and conducting 

DP failure investigations. This 

would reduce the likelihood that 

significant casualties or property 

damage occur because of a poorly 

created CAMO or ASOC or WSOC. 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
70968 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

TABLE 10—DESCRIPTION OF BENEFITS OF THE NPRM—Continued 

Key provision 

Design 

standards & 

classification 

Operations Manning 

& training Reporting Description How provision reduces risk 

61.50–4 Oversight 

of dynamic positioning system 

assurance organizations.

.................... ................... ................ ................ All applicable vessels must 

have the DPSAO complete an annual DP failure 

investigation report. This 

report would be reviewed 

annually by the OCS 

NCOE.

Provides Coast Guard officials with 

information on how and why DP 

failures occur. This information provides valuable feedback to ensure 

that future such incidents do not 

occur, which would reduce the 

probability of significant casualties 

or property damage from occurring 

in the future. Further, this information would allow the Coast Guard 

to determine whether the DPSAO 

is still under compliance with the 

requirements necessary of an authorized DPSAO specified in 

61.50–3. 

61.50–5, 61.50–10, 

61.50–15 Initial, 

periodic, and annual surveys of 

DP systems.

.................... ................... ................ ................ Requires all vessels that 

use a DP system to conduct Critical OCS Activities to have surveys to 

ensure compliance with 

DP system requirements. 

Additionally, these sections require that the authorized DP assurance organization conducting the 

survey notify the Coast 

Guard on the location and 

time of the survey.

Ensures safe design and operation 

for all vessels that use a DP system to conduct Critical OCS Activities. Tests a vessel’s FMEA and 

CAMO to ensure that they are developed and maintained, which 

would reduce the likelihood of significant casualties or property damage from occurring in the future. Allows Coast Guard officials the opportunity to participate in DP system surveys. The Coast Guards 

presence will verify and complement the findings of a third-party 

surveyor, thereby ensuring that DP 

system equipment is operational 

and properly maintained, which 

would reduce the likelihood of a 

loss of position occurring in the future. 

46 CFR Part 62—Vital System Automation 

62.20–2 Required 

plans for DP systems.

.................... ................... ................ ................ Requires all MODUs that 

conduct Critical OCS Activities and all other vessels of at least 6,000 GT 

ITC that have installed a 

DP system on or after the 

effective date of this final 

rule to submit a DP system plan to assurance 

DPSAO.

Ensures safe design for all vessels 

that use a DP system to conduct 

Critical OCS Activities by requiring 

that systems be verified by independent third party, which would 

reduce the probability of significant 

casualties or property damage. 

Classification, plan review and certification requirements serves as a 

fundamental building block for safe 

DP operations by ensuring a minimum level of reliability for a DP 

system verified by a qualified third 

party, particularly for higher risk 

vessels. 

Requires the DPSAO to 

submit a copy of the approved DP system plan, 

as well as the Annual 

Survey Document in subsequent years, to the 

commanding officer of the 

Marine Safety Center.

The Coast Guard’s oversight would 

verify and complement the findings 

of a third-party surveyor, thereby 

ensuring that DP system equipment 

is operational and properly maintained, which would reduce the 

likelihood of a loss of position occurring in the future. It would further provide for government oversight. 

62.25–40 Environmental design 

standards on 

OCS units.

.................... ................... ................ ................ Incorporates IEC environmental standards into 

Title 46.

Reduces the risk of pollution or a 

subsea spill by ensuring that design of DP system equipment 

meets environmental standards. 


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59Although reporting to the IMCA is voluntary, 

we accept this average rate, as it is the best available 

data currently available. 

60Marine Technology Society. ‘‘Reliability and 

Risk Analysis,’’ Dynamic Positioning Conference. 

October 21–22, 1997. Page 29. 

61 Inflation Adjustment Calculation = > 2013 

value =. The average annual CPI–U data was 

obtained from the BLS at http://stats.bls.gov/cpi/ 

cpifiles/cpiai.txt. 

TABLE 10—DESCRIPTION OF BENEFITS OF THE NPRM—Continued 

Key provision 

Design 

standards & 

classification 

Operations Manning 

& training Reporting Description How provision reduces risk 

62.40–3, and 

62.40–5, 62.40– 

10 Design 

standards and 

classification for 

DP systems on 

OCS.

.................... ................... ................ ................ Requires all vessels that 

use a DP system to conduct Critical OCS Activities to meet the DP Operation Standards in IMO 

MSC/Circ. 645 and recommend following the 

MTS DP Operation 

Guidelines. Requires all 

applicable vessels to obtain DP notation equivalent to Equipment class 2 

or higher from an authorized classification society.

Reduces probability of a DP system 

failure occurring, because a DP–2 

system must maintain position at all 

times, excluding incidents involving 

the loss of a compartment. 

All applicable vessels must 

maintain an FMEA that 

demonstrates compliance 

with the applicable provisions of IMO MSC/

Circ.645 for DP equipment class 2 or higher.

Ensures that all vessels and MODUs 

meet their maximum level of redundancy, functionality, and operation, 

and that no single fault would exceed the identified worst-case failure. This would reduce the likelihood of significant casualties or 

property damage, since the DP 

system would alert the DPO or 

DPOQ before a worst-case failure 

occurs. 

62.40–15, 62.40–20 

FMEA and FMEA 

proving test documents.

.................... ................... ................ ................ Requires vessel owners or 

operators to create and 

maintain a vessel’s FMEA 

and FMEA test proving 

document.

Ensures that each vessels’ and 

MODUs’ DP system failure modes 

are assessed and tested to ensure 

that limits are understood and in 

compliance with regulations. 

62.40–25 Critical 

Activity Mode of 

Operation 

(CAMO).

.................... ................... ................ ................ Requires owners or operators to develop and maintain a CAMO.Ensures that all vessels and MODUs 

meet their maximum level of redundancy, functionality, and operation 

and that no single fault would exceed the identified worst-case failure. This would reduce the likelihood of significant casualties or 

property damage, since the DP 

system would alert the DPO or 

DPOQ before a worst-case failure 

occurs. 

Because DP is an emerging technology 

and there are no existing requirements 

for reporting DP incidents, we have 

casualty reports of uncertain quality, 

constraining our ability to conduct a 

casualty review. However, we attempt to 

quantify the potential benefits that are 

expected to result from the requirements 

in this NPRM using the best available 

information that we have gathered from 

various segments of industry. These 

benefits focus on damages only, and not 

on fatalities, injuries or environmental 

damage given the limitations in data 

noted. 

In publicly available documents (2004 

through 2010), the IMCA estimates that 

an average of 1.45 DP incidents occur 

per vessel every year.59 Next, we 

estimate the number of DP incidents 

that are expected to occur given the 

forecasted population figures and the 

average DP incident rate per vessel per 

year. 

Next, we calculate the number of DP 

incidents that resulted in a loss of 

position and damages using IMCA 

station keeping incident reports 

provided from 2004 through 2010. The 

average percentage of incidents that 

resulted in vessel damages from 2004 

through 2010 was 6 percent for nondrilling vessels and 4 percent for 

drilling vessels. 

Using the average percentage of 

incidents that result in vessel damage 

and the total number of incidents 

forecasted to occur during the 10-year 

period of our study, we then calculate 

the total cost that would occur to 

industry as a result of DP incidents. 

According to the MTS ‘‘Reliability and 

Risk Analysis,’’ for DP incidents that 

result in damages, ‘‘the average incident 

cost for drilling is estimated to be $2 

million, which includes rig downtime, 

possible damage, the possibility of a 

fishing job, and even the remote 

possibility of lost well control.’’ 60 We 

note that this cost does not take into 

account the possibility of injuries or loss 

of life that could result from DP 

incidents, and, therefore, is likely an 

underestimate. We then adjust this 

estimate to $2,902,891 to account for 

inflation that occurred between 1997 

and 2013.61 For non-drilling vessels, we 

estimate that the cost per DP incident 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
70970 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

62Calculation used = > × $2,902,891. 63 Day rate for non-drilling vessel = $23,818. 

‘‘Dynamic Positioning System Research Task 

Order,’’ by Rolling Bay, LLC August 2012. The 

average day rate for drilling vessels = $527,506. 

66This reduction is based on a decrease in the 

frequency of DP position-loss incidents, from a 

frequency of six DP position-loss incidents in 6 

months prior to adoption of the MTS DP Operations 

guidance, to five position-loss incidents in 8 years 

following the adoption of the guidance. 

67New DP incident rate per vessel per year = 1.45 

× 0.05. 

that results in damages is $132,991.62

We calculated this figure by estimating 

the percentage difference between day 

rates for non-drilling vessels and 

drilling vessels, and then multiplying 

that percentage by the inflation adjusted 

total damages provided in the MTS 

‘‘Reliability and Risk Analysis.’’ 63

For DP incidents that do not result in 

damages, we calculate the cost to 

investigate the incident, as well as the 

lost revenue that would occur while the 

investigation was taking place. 

According to a Coast Guard Subject 

Matter Expert, it was determined that it 

would take an engineer 10 hours on 

average to investigate a DP incident, at 

an hourly loaded wage of $57.64 Further, 

the Coast Guard estimates that a nondrilling vessel would lose $10,070 of 

revenue per DP incident that does not 

result in any damages, and a drilling 

vessel would lose $219,794 of revenue 

per DP incident that does not result in 

any damages.65 This lost revenue would 

occur as a result of operations having to 

be stopped while the engineer conducts 

the DP incident investigation. 

Following this calculation (our 

baseline), we then calculate the cost of 

DP incidents following the effective date 

of our final rule. First, we needed to 

calculate the rate of DP incidents that 

are expected to occur after publication 

of a final rule. Based on roundtable 

conversations with owners and 

operators of DP vessels that operate on 

the U.S. OCS, we estimate that DP 

incidents would be reduced by 95 

percent after adopting the MTS DP 

Operations guidance.66 If we assume 

that the vessels were experiencing the 

industry average number of incidents 

per year, 1.45, prior to adopting the 

MTS guidance, then a 95-percent 

reduction in DP incidents would equate 

to vessels experiencing only 0.0725 DP 

incidents per year following adoption of 

the MTS guidance.67 Using this new 

figure, we recalculated the number of 

DP incidents that are expected to occur 

given the forecasted population figures. 

However, we continue to use the 

original DP incident rate (1.45 incidents 

per vessel per year) for vessels that 

would not benefit from this proposed 

rule, or would not benefit from the 

proposed rule until the applicable 

phase-in date. 

After implementation of the NPRM, 

we estimate that 2,926 DP incidents for 

vessels other than MODUs (OSVs and 

crewboats) and 361 DP incidents for 

drilling vessels (MODUs) would be 

prevented over the 10-year period of our 

analysis. 

Using the same methodology that we 

used to calculate the cost of DP 

incidents that would occur without this 

proposed rule, we then estimate the 

total cost of DP incidents after 

implementation of this proposed rule. 

We assume that the average percentage 

of DP incidents that result in damages 

remains the same. 

We estimate that the reduction in the 

occurrence of DP failures would result 

in avoided damages of $115.849 million 

($28.375 million to owners or operators 

of domestic vessels), discounted at a 7- 

percent rate, and $146.289 million 

($37.050 million to owners or operators 

of domestic vessels), discounted at a 3- 

percent rate, over the 10-year period of 

our analysis. The annualized benefits 

are estimated to be $16.494 million 

($4.040 million to owners or operators 

of domestic vessels), discounted at a 7- 

percent rate, and $17.150 ($4.343 

million to owners or operators of 

domestic vessels), discounted at a 3- 

percent rate. 

Table 11 summarizes the total 

damages avoided that would accrue to 

industry from issuing this NPRM. These 

avoided damages would accrue from a 

reduction in the frequency of DP 

failures, which would reduce vessel 

downtime, possible damage, and the 

possibility of lost well control. These 

benefits do not reflect the potential 

reduction in the risk of injuries or 

fatalities that would likely occur after 

implementation of this NPRM. Figure 3 

supplements Table 11 by providing a 

graphical representation of the 

difference between the cumulative total 

costs incurred by noncompliant vessels 

prior to the issuance of a final rule, and 

the cumulative total costs incurred by 

noncompliant vessels after issuance of a 

final rule. 

TABLE 11—TOTAL 10-YEAR AVOIDED DAMAGES FROM NPRM 

Time period 

Undiscounted benefits Discounted benefits Annualized benefits 

Vessels other 

than MODUs Drilling vessels Total 7% 3% 7% 3% 

Total Damages from 

DP Incidents prior to 

DP System Rule ....... $105,234,662 $126,218,084 $231,452,746 $157,200,830 $194,581,898 $22,381,862 $22,810,935 

Total Damages from 

DP Incidents after DP 

System Rule ............. 51,101,224 3,746,191 54,847,415 41,351,452 48,293,037 5,887,517 5,661,417 

Estimated Benefits from 

Following MTS Guidance .......................... 54,133,438 122,471,893 176,605,331 115,849,378 146,288,861 16,494,345 17,149,517 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 70971 

Request for Comment 

We request additional comments on 

our benefit model assumptions. 

Information is specifically requested on 

the following: 

(1) Frequency of changes in DP status 

from green to red, and green to yellow; 

(2) The rate of DP incidents that result 

in damages and the type and amount of 

these damages; 

(3) The effectiveness of the proposed 

rule in reducing DP incidents, loss of 

position, and resulting consequences; 

and 

(4) Case studies on DP incidents that 

resulted in a loss of position. 

DATES: Comments and related material 

must be submitted to the online docket 

via http://www.regulations.gov or reach 

the Docket Management Facility on or 

before February 26, 2015. Comments 

sent to the Office of Management and 

Budget (OMB) on collection of 

information must reach OMB on or 

before February 26, 2015. 

ADDRESSES: Submit comments using any 

one of the listed methods, and see 

SUPPLEMENTARY INFORMATION for more 

information on public comments. 

• Online—http://www.regulations.gov 

following Web site instructions. 

• Fax—202–493–2251. 

• Mail—Docket Management Facility 

(M–30), U.S. Department of 

Transportation, West Building Ground 

Floor, Room W12–140, 1200 New Jersey 

Avenue SE., Washington, DC 20590– 

0001. 

• Hand delivery—mail address, 9 

a.m. and 5 p.m., Monday through 

Friday, except Federal holidays 

(telephone 202–366–9329). 

Comparison of Costs vs. Benefits 

We estimate that the total annualized 

net cost of this NPRM is $4.219 million 

($6.680 million to domestic owners or 

operators), discounted at a 7-percent 

rate, and $3.930 million ($6.653 million 

to domestic owners or operators), 

discounted at a 3-percent rate. Tables 12 

and 13 summarize the net costs that 

would be incurred as a result of the 

publication of this NPRM. Figure 4 then 

compares the cumulative net present 

value, using a 7-percent discount rate, 

as a result of publication of this NPRM 

to the net present value of not requiring 

the provisions in this NPRM (i.e., the 

baseline). 

TABLE 12—TOTAL CUMULATIVE NET PRESENT VALUE FROM NPRM 

Year 

Discounted costs Discounted benefits Net present value 

7% 3% 7% 3% 7% 3% 

1 ....................... $11,879,832 $12,809,668 $8,008,721 $8,319,739 ($4,683,985 ) ($4,865,887 ) 

2 ....................... 23,878,206 25,758,050 16,568,099 17,556,832 (8,122,981 ) (8,577,177 ) 

3 ....................... 32,911,477 35,885,141 25,319,946 27,368,422 (8,404,405 ) (8,892,677 ) 

4 ....................... 67,122,135 75,727,738 36,404,432 40,277,695 (31,530,576 ) (35,826,001 ) 

5 ....................... 76,654,716 87,260,764 49,473,907 56,089,844 (27,993,683 ) (31,546,879 ) 

6 ....................... 85,580,403 98,478,907 62,079,796 71,933,404 (24,313,481 ) (26,921,461 ) 

7 ....................... 111,205,850 131,936,702 75,965,563 90,063,319 (36,053,161 ) (42,249,341 ) 

8 ....................... 120,414,846 144,427,343 89,321,957 108,179,291 (31,905,763 ) (36,624,010 ) 

9 ....................... 129,470,866 157,187,510 102,476,664 126,714,614 (27,807,076 ) (30,848,853 ) 

10 ..................... 144,669,412 179,434,311 115,849,378 146,288,861 (29,632,908 ) (33,521,407 ) 

Total .......... 144,669,412 179,434,311 115,849,378 146,288,861 (29,632,908 ) (33,521,407 ) 

Annualized ....... 20,597,670 21,035,175 16,494,345 17,149,517 4,219,059 3,929,732 


tkelley on DSK3SPTVN1PROD with PROPOSALS3EP28NO14.003</GPH>
70972 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

68 Value of a statistical life is currently measured 

at $9.1 million. ‘‘Guidance on Treatment of the 

Economic Value of a Statistical Life,’’ prepared for 

the U.S. Department of Transportation, April 2013. 

http://www.dot.gov/sites/dot.dev/files/docs/ 

VSL%20Guidance%202013.pdf. 

TABLE 13—COMPARISON OF ANNUALIZED BENEFITS AND COSTS TO INDUSTRY AND GOVERNMENT

[7-Percent discount rate] 

Rule Cost to industry Total benefits Net benefits 

DP System NPRM ..................................................................................................... $20,597,670 $16,494,345 ($4,219,059) 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

These net benefits do not include the 

potential reduction in the number of 

injuries or fatalities that would likely 

occur after publication of this NPRM. As 

a result, these net benefits are likely to 

be underestimated. 

Breakeven Analysis 

Based on monetized benefits from 

reduction in property damage and lost 

productivity, the NPRM would not 

result in positive net benefits. However, 

our monetized estimates do not include 

benefits that would accrue to society 

from reducing the risk of fatalities or 

environmental damage from an oil spill 

that could result from a catastrophic DP 

event, such as a collision with a MODU 

during drilling operations caused by a 

DP-related loss of position. It is likely 

then, that we have underestimated the 

total benefits that would result from this 

proposed rule. Unfortunately, because 

of data limitations, we are unable to 

calculate the risk of a catastrophic event 

causing fatalities or oil spills that would 

be prevented as a result of requiring the 

provisions in this proposed rule. 

Instead, we estimate the number of 

fatalities that would need to be 

prevented per year in order for this 

proposed rule to be cost neutral, by 

using the value of a statistical life 

(VSL).68 Using the VSL to monetize the 

value of fatalities and fatalities 

prevented, the NPRM would need to 

prevent 0.5 fatalities per year from 

occurring during the 10-year period for 

net benefits to equal the net cost of this 

NPRM. 

Table 14 summarizes this breakeven 

analysis. 

TABLE 14—EXPAND DP SYSTEMS IN OCS NPRM, BREAKEVEN ANALYSIS

[7 percent, annualized] 

NPRM requirement Annualized net 

cost 

Fatalities 

prevented to 

breakeven 

Total for NPRM requirements .................................................................................................................................. ($4,219,059) 0.46 

The consequences of a loss of position 

while using DP can be high. In order to 

put this breakeven analysis in 

perspective, we consider and compare 

the impacts of two events to illustrate 

potential worst case scenarios that could 

result from a DP-related loss of position. 

First, as an example of the fatalities that 

could result from a loss of position and 

subsequent collision, we use the 

SAMUDRA SURAKSHA incident as a 

reasonable worst case scenario. In order 


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Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 70973 

69We acknowledge that the SAMUDRA 

SURAKSHA incident would not be avoided or its 

consequences mitigated as a result of this proposed 

rule since it involved a foreign flag vessel operating 

in foreign waters. 

70 ‘‘Active Shoreline Cleanup Operations from 

Deepwater Horizon Accident End’’, press release 

from BP, 15 April 2014, available at: http:// 

www.bp.com/en/global/corporate/press/pressreleases/active-shoreline-cleanup-operations-dwhaccident-end.html. 

for this proposed rule’s benefits to equal 

its costs, one worst case event on the 

magnitude of the SAMUDRA 

SURAKSHA which resulted in 22 

fatalities, would need to be prevented 

approximately every 48 years to 

breakeven.69

A loss of position and collision could 

result in a catastrophic oil spill if a 

MODU is involved and the blowout 

preventer does not engage or fails (as 

was the case during the DEEPWATER 

HORIZON). The DEEPWATER 

HORIZON oil spill illustrates the 

potential environmental damage that 

could result from an oil spill from an 

uncontrolled well. The DEEPWATER 

HORIZON incident resulted in an 

estimated 4.9 million barrels of oil 

spilled. To date, the responsible party 

has spent $14 billion on cleanup costs 

alone. This estimate of cleanup costs 

does not include additional restoration 

costs under the Natural Resource 

Damage Assessment process or other 

liabilities or settlements.70 Assuming a 

$14 billion cleanup cost for a reasonable 

worst case catastrophic oil spill, the 

proposed rule would have to prevent 

one such event every 1,000 years to 

breakeven. 

Alternatives 

We examined several alternatives 

with varying degrees of vessel 

applicability and required provisions. 

Of the alternatives examined, we 

selected the alternative that provided 

industry with the largest amount of 

flexibility without sacrificing maritime 

safety. The Coast Guard considered the 

following alternatives: 

• Proposed Alternative (NPRM); 

• Alternative 2: Grandfathering all 

existing non-drilling DP vessels; 

• Alternative 3: No Grandfathering 

and No Phase-in Period; 

• Alternative 4: Proposed Alternative 

Plus Additional DP Manning 

Requirements for non-drilling vessels 

with new or upgraded DP systems; and 

• Alternative 5: Alternative 3 Plus 

Additional DP Manning Requirements. 

Because of the frequency of DPrelated incidents, as well as the 

potential for severe consequences that 

could occur as the result of an incident, 

the Coast Guard decided that the 

benefits that would be gained through 

requiring compliance from existing 

OSVs and crewboats would outweigh 

any additional costs that would be 

incurred by industry. 

In order to minimize the impact on 

existing OSVs and crewboats, the Coast 

Guard developed the proposed 

alternative, which uses a phase-in 

schedule to provide existing nondrilling vessels with some flexibility in 

meeting the provisions of this proposed 

alternative. Further, the Coast Guard 

decided to grandfather existing nondrilling vessels from being required to 

comply with the most costly provisions 

in this proposed rule–-the provisions 

that would require a vessel using DP to 

use a DP–2 system or higher and obtain 

a DP–2 or high class notation. 

Through providing flexibility to 

existing OSVs and crewboats, the 

proposed alternative minimizes costs, 

without sacrificing benefits that could 

accrue from a larger population of 

vessels. 

Table 15 summarizes the alternatives 

considered. The costs and benefits 

displayed are for both total 10-year costs 

and benefits and the annualized cost 

and benefits discounted at a 7 percent 

annual rate. Because the net benefits do 

not include the potential reduction in 

the number of injuries or fatalities that 

are likely to occur after issuance of a 

final rule, Table 15 also includes the 

number of fatalities that would need to 

be prevented for the costs of this 

proposed rule to equal the benefits. 

TABLE 15—COMPARISON OF ALTERNATIVES

Proposal Annualized cost 

(7% discount rate) 

Annualized 

benefits 

(7% discount rate) 

Annualized net 

cost 

(7% discount rate) 

Number of 

fatalities needed to 

be prevented per 

year to breakeven 

Impact of alternative 

Proposed Alternative.$20,597,670 $16,494,345 ($4,219,059) 1 fatality per year • Offers protection for 91% of crew 

from risk of DP failure. 

• Mitigates risk for 462 vessels. 

• Reduces costs by allowing continued use of existing DP–1 systems 

as long as they meet good operational practices. 

• Minimizes burden by allowing 

phase-in of operational requirements based on risk. 

Alternative 2 .......... 13,307,230 13,688,325 (265,983) 0 fatalities per year • Offers protection for 51% of crew 

from risk of DP failure. 

• Mitigates risk for 205 vessels. 

• Minimizes burden by grandfathering 

non-drilling vessels that have installed a DP system prior to the effective date of a final rule. 

Alternative 3 .......... 25,718,386 21,699,818 (4,896,965) 1 fatality per year • Offers protection for 100% of crew 

from risk of DP failure. 

• Mitigates risk for 528 vessels. 

• Requires non-drilling vessels that 

have installed a DP system prior to 

the effective date of a final rule to 

comply with all operational requirements before issuance of final rule. 

Alternative 4 .......... 137,508,218 16,494,345 (121,332,655) 14 fatalities per 

year.

• Offers protection for 91% of crew 

from risk of DP failure. 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
70974 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

71To estimate this cost, we first derive the total 

number of crew members working onboard vessels 

which currently do not comply with this proposed 

rule in its entirety. Next, we calculate the number 

of crew members working on board vessels which 

would benefit from the provisions in each of the 

alternatives listed above. The cost to address this 

risk is then estimated by dividing the annualized 

cost of each alternative by the number of crew 

members expected to be on board vessels which 

would benefit from the provisions in each of the 

alternatives. 

TABLE 15—COMPARISON OF ALTERNATIVES—Continued 

Proposal Annualized cost 

(7% discount rate) 

Annualized 

benefits 

(7% discount rate) 

Annualized net 

cost 

(7% discount rate) 

Number of 

fatalities needed to 

be prevented per 

year to breakeven 

Impact of alternative 

• Mitigates risk for 462 vessels. 

• Minimizes burden by allowing 

phase-in of operational requirements based on risk. 

• Requires additional manning requirements for new builds that industry is unlikely to meet on its 

own. 

Alternative 5 .......... 625,109,533 21,699,818 (608,728,065) 67 fatalities per 

year.

• Offers protection for 100% of crew 

from risk of DP failure. 

• Mitigates risk for 528 vessels. 

• Requires non-drilling vessels that 

have installed a DP system prior to 

the effective date of a final rule to 

comply with all operational requirements before issuance of final rule. 

• Requires additional manning requirements for all vessels using DP 

that industry is unlikely to meet on 

its own. 

* Net Cost does not include avoided fatalities or other benefits of this proposed rule. 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

Although Table 15 shows that 

Alternative 2, which would grandfather 

all existing non-drilling vessels from 

having to comply with this proposed 

rule, minimizes net costs, Alternative 2 

would reduce the risk of a fatality the 

least out of all of the alternatives. This 

is because fewer vessels would benefit 

from the proposed requirements, and 

thus the probability of a DP incident, 

which could result in a fatality, would 

remain at its current rate for a majority 

of existing vessels using DP on the U.S. 

OCS. Furthermore, given the 

catastrophic damage potential of DPrelated incidents from non-drilling 

vessels, the additional costs are 

relatively small. In Table 16, we 

summarize the risk of fatality addressed 

and the cost to address that risk in each 

of the alternatives. 

TABLE 16—COMPARISON OF THE RISK OF FATALITY ADDRESSED BY ALTERNATIVE

Proposal 

Total crew 

subject to 

risk of 

fatality— 

baseline 

Crew with 

risk of 

fatality 

addressed 

Percentage 

of potential 

fatality risk 

addressed 

Annualized 

cost 

Cost per 

fatality risk 

addressed 

Alternative 1 ..................................................................................... 5,119 4,675 91 $20,179,651 $4,316.50 

Alternative 2 ..................................................................................... 5,119 2,623 51 13,072,297 4,983.72 

Alternative 3 ..................................................................................... 5,119 5,119 100 24,990,468 4,881.90 

Alternative 4 ..................................................................................... 5,119 4,675 91 137,090,199 29,324.11 

Alternative 5 ..................................................................................... 5,119 5,119 100 624,381,615 121,973.36 

Table 16 shows that the cost to reduce 

the risk of a fatality occurring while a 

vessel is using DP is minimized under 

the proposed alternative.71

Alternative 1: Proposed Alternative 

The analysis for this alternative is 

discussed in detail previously in this 

RA. 

Alternative 2: Grandfathering All 

Vessels Other Than MODUs With 

Existing DP Systems 

For this alternative, the Coast Guard 

would grandfather all vessels other than 

MODUs with existing DP systems, and 

OSVs and crewboats with an existing 

DP system would not be required to 

comply with any of the DP requirements 

in this NPRM. As a result, this would 

provide industry with the greatest 

amount of flexibility in meeting the 

requirements in the proposed 

alternative, because it would only 

require future OSVs and crewboats to 

comply with the provisions in this 

proposed rule, in addition to still 

requiring MODUs with existing and 

future DP systems to comply 

immediately with the provisions in the 

proposed alternative. This approach was 

created after taking into account the 

increased risk profile of MODUs, as well 

as current industry practices. By 

examining the existing population of 

MODU’s vessel specification sheets, we 

determined that all existing MODUs 

operating on the U.S. OCS that utilize 

DP would comply with the most costly 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
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provisions in this NPRM. Because of 

this, as well as the higher risk profile of 

MODUs, we elected not to grandfather 

in MODUs with existing DP systems as 

outlined in this alternative. 

We considered Alternative 2 because 

of the large proportion of OSVs and 

crewboats with existing DP systems that 

would not be compliant with the most 

costly DP provisions in this NPRM. 

However, because of the high risk 

potential of DP-related incidents, we 

decided that the benefits that would be 

gained through requiring compliance 

from existing OSVs and crewboats 

would outweigh the additional costs 

that would be incurred by industry. 

Alternative 3: No Grandfathering and 

No Phase-in Period 

For this alternative, the Coast Guard 

would require all vessels other than 

MODUs with existing DP Systems to 

comply with the requirements in this 

proposed rule immediately following 

issuance of a final rule. This alternative 

would affect the same number of 

existing OSVs and crewboats as in 

proposed alternative, but would not 

permit existing vessels to phase-in DP 

requirements. 

We considered this Alternative 3 

because of the high probability that 

significant consequences could occur as 

a result of a DP failure. However, this 

alternative places a larger burden on 

industry that cannot be justified by 

either the added benefits that would be 

incurred by requiring the existing 

population of non-drilling vessels using 

DP to comply with the requirements in 

the NPRM immediately following 

publication of a final rule (the net cost 

of this alternative is greater than the 

proposed alternative), or the reducing 

the risk of death for a greater number of 

crew members. As a result, we rejected 

Alternative 3. 

Alternative 4: Additional DP Manning 

Requirements 

Under Alternative 4, all vessels, with 

the exception of MODUs, that have a 

new DP system would be required to 

have a DPO or DPOQ whose only 

responsibility is operating the DP 

system. 

We rejected this alternative because 

industry is unlikely to comply with the 

additional DP manning requirements in 

the absence of this NPRM. As such, 

industry would incur large costs that 

would not be justified by the benefits. 

Alternative 5: Additional DP Manning 

Requirements With No Grandfathering 

Alternative 5 would also require 

additional DP manning requirements, 

but would not grandfather vessels other 

than MODUs that have an existing DP 

system. Because industry is not 

currently complying with this 

requirement and is not expected to 

comply with it in the future, we expect 

that this provision would burden 

industry with large costs that would 

likely force a large number of vessels 

out of the market. We, consequently, 

rejected this alternative. 

B. Small Entities 

In accordance with the Regulatory 

Flexibility Act (5 U.S.C. 601–612), the 

Coast Guard prepared this Initial 

Regulatory Flexibility Analysis (IRFA) 

that examines the impacts of the NPRM 

on small entities (5 U.S.C. 601 et seq.). 

Due to the anticipated impacts on small 

businesses, Coast Guard is including an 

analysis of the NPRM requirements for 

informational purposes. 

A small entity may be— 

• A small independent business, 

defined as any independently owned 

and operated business not dominant in 

its field that qualifies as a small 

business per the Small Business Act (5 

U.S.C. 632); 

• A small not-for-profit organization; 

and 

• A small governmental jurisdiction 

(locality with fewer than 50,000 people). 

An IRFA addresses the following: 

• A description of the reasons why 

action by the agency is being 

considered; 

• A succinct statement of the 

objectives of, and legal basis for, the 

proposed rule; 

• A description of and, where 

feasible, an estimate of the number of 

small entities to which the proposed 

rule will apply; 

• A description of the projected 

reporting, recordkeeping and other 

compliance requirements of the 

proposed rule, including an estimate of 

the classes of small entities which will 

be subject to the requirement and the 

type of professional skills necessary for 

preparation of the report or record; 

• An identification, to the extent 

practicable, of all relevant Federal rules 

which may duplicate, overlap or 

conflict with the proposed rule; and 

• A description of any significant 

alternatives to the proposed rule which 

accomplish the stated objectives of 

applicable statutes and which minimize 

any significant economic impact of the 

proposed rule on small entities. 

1. Description of the Reasons Why 

Action by the Agency Is Being 

Considered 

Agencies take regulatory action for 

various reasons, one of which is the 

failure of markets to reach socially 

optimal outcomes. The market failures 

prompting this proposed rule result 

from the absence of economic incentives 

that promote an optimal outcome. 

The absence of economic incentives 

that promote an optimal outcome results 

in a negative externality. A negative 

externality is an adverse byproduct of a 

transaction not accounted for within the 

transaction. In this case, MODUs and 

other vessels that use DP to engage in 

OCS activities that operate with lower 

safety standards may cause harm or 

increased risk of harm to human safety 

and the environment. The cost of these 

lower safety standards (increased risk) is 

not completely borne by the OSV or 

MODU owners, so they are external to 

the business decisions of these owners. 

The crew, which may face increased 

risk from lower safety standards, may 

not have any say in safety-related 

decisions. Since the crew may be 

adversely affected by business decisions 

which it may not be able to mitigate 

through increasing its price (labor cost), 

it absorbs the cost of the externality 

(increased risk from lower safety 

standards) which is a market failure. Oil 

spills that result from OSV or MODU 

accidents also impose an externality in 

the form of environmental damage and 

clean-up costs that are not borne 

directly by the OSV and MODU owners. 

2. Succinct Statement of the Objectives 

of, and Legal Basis for, the Proposed 

Rule 

Establishing these minimum 

standards is necessary to improve the 

safety of people and property involved 

in such operations, and the protection of 

the environment in which they operate. 

This proposed rule would decrease the 

risk of a loss of position by a 

dynamically-positioned MODU or other 

vessel that could result in a fire, 

explosion, or subsea spill, and supports 

the Coast Guard’s strategic goals of 

maritime safety and protection of 

natural resources. 

Several sections of the Outer 

Continental Shelf Lands Act (43 U.S.C. 

1331–1356a,) provide ‘‘the Secretary of 

the Department in which the Coast 

Guard is operating’’ with rulemaking 

authority. The Secretary’s authority 

under all these sections is delegated to 

the Coast Guard through Department of 

Homeland Security Delegation No. 

0170.1, paragraph II(90). 

43 U.S.C. 1333(d)(1) gives the 

Secretary ‘‘authority to promulgate and 

enforce such reasonable regulations 

with respect to lights and other warning 

devices, safety equipment, and other 

matters relating to the promotion of 

safety of life and property on the 


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72OCS activity is defined in 33 CFR 140.10 to 

mean ‘‘any offshore activity associated with 

exploration for, or development or production of, 

the minerals of the Outer Continental Shelf.’’ 

73We have separated our analysis of OSVs into 

OSVs of at least 500 GT ITC and OSVs under 500 

GT ITC in order to account for the phase-in 

schedule which would only require OSVs of at least 

500 GT ITC to meet more stringent DP 

requirements. 

artificial islands, installations, and other 

devices referred to in subsection (a) of 

this section or on the waters adjacent 

thereto, as [the Secretary] may deem 

necessary.’’ The Coast Guard interprets 

section 1333(d)(1) as conferring 

authority to regulate any OCS vessel or 

facility (collectively referred to as ‘‘OCS 

unit’’) attached to the OCS seabed or 

engaged in OCS activity to support such 

a unit.72

Section 1347(c) requires promulgation 

of ‘‘regulations or standards applying to 

unregulated hazardous working 

conditions related to activities on the 

outer Continental Shelf when . . . such 

regulations or standards are [determined 

to be] necessary’’ and authorizes the 

modification ‘‘from time to time’’ of 

‘‘any regulations, interim or final, 

dealing with hazardous working 

conditions on the Outer Continental 

Shelf.’’ Section 1348(c) requires 

promulgation of regulations for onsite 

scheduled or unscheduled inspections 

of OCS facilities ‘‘to assure compliance 

with . . . environmental or safety 

regulations.’’ Additionally, section 1356 

calls for regulations requiring, with 

limited exceptions, all OCS units to be 

manned by U.S. citizens or resident 

aliens and to comply with ‘‘such 

minimum standards of design, 

construction, alteration, and repair’’ as 

the Secretary or the Secretary of the 

Interior establishes. 

3. Description of and, Where Feasible, 

an Estimate of the Number of Small 

Entities To Which the Proposed Rule 

Will Apply 

Through review of the Coast Guard’s 

MISLE database, as well as comparing 

owners’ annual revenues to the small 

business threshold as defined by the 

Small Business Administration, we 

determined the number of small entities 

within drilling and non-drilling owners 

that would be affected by this proposed 

rule. We did not find any drilling or 

non-drilling vessels owned by 

governments or non-profits. 

Table 17 provides the SBA’s revenue 

thresholds for the entities that are 

affected by this proposed rule. We used 

these standards in our analysis to 

determine which entities should be 

defined as small. 

TABLE 17—STANDARD SIZE OF REVENUE OF ENTITIES AFFECTED BY NPRM 

NAICS code Description of NAICS group Standard size of 

revenue 

213112 ................................ Support Activities for Oil and Gas Operations ............................................................................. $7,000,000 

487210 ................................ Water Transportation Excursion ................................................................................................... 7,000,000 

488330 ................................ Navigation Services to Shipping .................................................................................................. 35,000,000 

488390 ................................ Other Support Activities for Water Transportation ....................................................................... 35,000,000 

522220 ................................ Sales Financing ............................................................................................................................ 7,000,000 

532411 ................................ Commercial Air, Rail, and Water Transportation Equipment Rentals and Leasing .................... 7,000,000 

541990 ................................ All Other Professional Scientific and Technical Services ............................................................ 14,000,000 

Through this analysis, we determined 

that all existing MODUs, 60 percent of 

all existing OSVs of at least 500 GT ITC, 

58 percent of all existing OSVs less than 

500 GT ITC, and 63 percent of all 

existing crewboats exceed these small 

business standards.73

The following tables summarize our 

findings. 

TABLE 18—SIZE OF MODUS

AFFECTED BY NPRM 

Number 

of 

owners 

Number 

of 

vessels 

Entities with Data— 

Above Threshold ....... 2 4 

Entities with Data— 

Below Threshold ....... 0 0 

Total Small Entities ....... 0 0 

Total .......................... 2 4 

Percentage of Small 

Entities ...................... 0.0% 0.0% 

The annual revenue for MODU 

owners that would be affected by this 

proposed rule is within a range of 

$875,000,000 to $3,000,000,000. Our 

results indicate that all drilling vessels 

using DP and currently operating on the 

U.S. OCS exceed the small business 

standards presented in Table 17. 

Next, we examined publicly available 

revenue data for owners and operators 

of OSVs of at least 500 GT ITC that use 

DP while operating on the U.S. OCS. 

These vessels would be required to 

comply with a majority of the 

provisions of this proposed rule by the 

date specified in Table 2 of this 

Regulatory Analysis section. Table 19 

summarizes our analysis on owners or 

operators of OSVs of at least 500 GT 

ITC. 

TABLE 19—SIZE OF OSVS OF AT

LEAST 500 GT ITC AFFECTED BY

NPRM 

Number 

of 

owners 

Number 

of 

vessels 

Entities with Data— 

Above Threshold ....... 21 401 

TABLE 19—SIZE OF OSVS OF AT

LEAST 500 GT ITC AFFECTED BY

NPRM—Continued 

Number 

of 

owners 

Number 

of 

vessels 

Entities with Data— 

Below Threshold ....... 14 56 

Total Small Entities ....... 14 56 

Total .......................... 35 457 

Percentage of Entities .. 40% 12% 

Through our analysis, we estimate 

that approximately 40 percent of owners 

or operators of existing OSVs of at least 

500 GT ITC that use DP are defined as 

small by the SBA threshold. The annual 

revenue stream of the entities affected 

by this proposed rule that are defined as 

small is within a range of $630,000 to 

$51,834,000. 

We then examined revenue data for 

owners or operators of OSVs less than 

500 GT ITC. Although these owners or 

operators would incur some cost as a 

result of this proposed rule, existing 

vessels in this group would be 


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74Or choose to not operate with DP. 

grandfathered from the most costly 

provisions. 

Table 20 describes the results of our 

analysis on the revenue streams of 

owners or operators of OSVs less than 

500 GT ITC. 

TABLE 20—SIZE OF OSVS LESS THAN

500 GT ITC AFFECTED BY NPRM 

Number 

of 

owners 

Number 

of 

vessels 

Entities with Data— 

Above Threshold ....... 14 48 

Entities with Data— 

Below Threshold ....... 10 23 

Total Small Entities ....... 10 23 

Total .......................... 28 71 

Percentage of Small 

Entities ...................... 42% 32% 

Using annual revenue data from 

public databases, we estimate that 

approximately 42 percent of the owners 

of vessels less than 500 GT ITC are 

small entities. The annual revenues for 

owners or operators defined as small 

entities range from $565,000 to 

$3,750,000. The median revenue per 

small entity owner is $3,109,500, while 

the mean revenue is $2,556,965. 

Lastly, we examined the revenue 

streams of owners or operators of 

crewboats that use DP on the U.S. OCS. 

Table 21 summarizes our findings. 

TABLE 21—SIZE OF CREWBOATS

AFFECTED BY NPRM 

Number 

of 

owners 

Number 

of 

vessels 

Entities with Data— 

Above Threshold ....... 8 36 

Entities with Data— 

Below Threshold ....... 3 7 

Total Small Entities ....... 3 7 

Total Entities ............. 11 43 

Percentage of Small 

Entities ...................... 27% 16% 

Using annual revenue data from 

public databases, we estimate that 

approximately 27 percent of the owners 

or operators of crewboats are small 

entities. The annual revenues for 

crewboat owners or operators defined as 

small entities range from $162,000 to 

$2,200,000. The median revenue per 

small entity owner or operator is 

$1,081,000, while the mean revenue is 

$1,147,667. As with OSVs less than 500 

GT ITC, however, these vessels would 

be grandfathered from having to comply 

with the most costly provisions in this 

proposed rule. 

4. A Description of the Projected 

Reporting, Recordkeeping and Other 

Compliance Requirements of the 

Proposed Rule, Including an Estimate of 

the Classes of Small Entities That 

Would Be Subject to the Requirement 

and the Type of Professional Skills 

Necessary for Preparation of the Report 

or Record 

In general, this proposed rule would 

require owners or operators of vessels 

that use DP on the U.S. OCS to— 

• Make available to the OCMI upon 

request a copy of a DPO/DPOQ’s 

certificate of completion of DP training 

courses; 

• Use DP–2 or higher systems if 

conducting Critical OCS Activities; 74

• Receive a DP–2 class notation; 

• Conduct an FMEA; 

• Develop and maintain a CAMO and 

ASOC or WSOC; 

• Report DP system incidents to an 

authorized DP assurance organization; 

• Conduct DP incidents 

investigations whenever the DP system 

status changes from green to yellow or 

red; 

• Report Serious Marine Incidents 

that result from a DP incident to the 

OCMI; 

• Submit a copy of a DP incident 

investigation report to the OCMI 

annually; 

• Report the time and location of a DP 

survey to the OCMI at least 30 days 

prior to the survey; and 

• Submit a copy of the vessel’s DP 

system plan if the vessel is a MODU or 

of at least 6,000 GT ITC. 

Our research indicates that all 

MODUs and OSVs that plan on using 

DP on the U.S. OCS will be built with 

a DP–2 system even in the absence of 

this proposed rule. Further, all existing 

MODUs that use DP on the U.S. OCS 

already are operating with DP–2 or 

higher systems. Lastly, because existing 

OSVs and crewboats would be 

grandfathered from having to comply 

with this requirement, we anticipate 

that only one future crewboat owner per 

year could potentially incur this cost. 

Therefore, this provision is expected to 

have a minimal impact on industry as 

a whole. 

To determine the impact of this 

proposed rule on an individual owner 

or operator, we calculated the expected 

cost for the vessel categories examined 

above to comply with all applicable 

provisions. 

Expected Cost to MODUs 

Because all drilling (MODU) owners 

or operators exceed the small business 

threshold and the expected cost to these 

owners or operators is estimated to be 

well below their annual revenue 

streams, we instead begin our analysis 

with the expected cost to owners or 

operators of OSVs of at least 500 GT 

ITC. 

Expected Cost to OSVs of at Least 500 

GT ITC 

We estimate that the total first-year 

cost of this NPRM to noncompliant 

owners or operators of existing OSVs of 

at least 500 GT ITC would be $286,835 

per vessel. Table 22 summarizes the cost 

per provision to these noncompliant 

vessels. 

TABLE 22—FIRST-YEAR COSTS TO AN EXISTING NON-COMPLIANT OSV OF AT LEAST 500 GT ITC 

Requirement First year cost 

Make Available DPO/DPOQ Training Certificates .............................................................................................................................. $114.40 

Replace DP–1 Crewboats ................................................................................................................................................................... 0.00 

Cost to receive DP–2 Class Notation .................................................................................................................................................. 0.00 

Conduct an FMEA ............................................................................................................................................................................... 275,000.00 

Develop a CAMO and ASOC .............................................................................................................................................................. 9,120.00 

Report DP System Incidents ............................................................................................................................................................... 177.87 

Conduct DP Incident Investigation And Write Report ......................................................................................................................... 2,236.19 

Report Serious Marine Incidents Resulting from DP Incident ............................................................................................................ 3.46 

Submit Annual DP Incident Investigation Report ................................................................................................................................ 169.10 

Obtain DPVAD ..................................................................................................................................................................................... 10.25 

Report DP Surveys .............................................................................................................................................................................. 4.10 


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75These vessels are expected to already comply 

with the FMEA, CAMO and ASOC, and DP 

Investigation requirements. 

TABLE 22—FIRST-YEAR COSTS TO AN EXISTING NON-COMPLIANT OSV OF AT LEAST 500 GT ITC—Continued 

Requirement First year cost 

Submit DP Systems Plan .................................................................................................................................................................... 0.00 

Total .............................................................................................................................................................................................. 285,835.36 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

After a review of the Coast Guard’s 

MISLE database, as well as vessel 

profiles that are publicly available on 

company Web sites, we estimate that 

roughly 50 percent of existing OSVs that 

would be phased-in to the DP 

requirements of this proposed rule 

would incur this entire cost. We 

estimate that the remaining owners or 

operators of existing OSVs affected by 

this proposed rule would incur a cost of 

$1,062.36 per vessel.75

Additionally, through conversations 

with members of industry, we expect 

that 50 percent of future OSVs of at least 

500 GT ITC would also incur the full 

cost displayed in Table 22. Like the 

existing population, the rest are 

expected to incur a cost of $1,062. 

We then use the population estimates 

in Table 3 of this Regulatory Analysis 

section to calculate the expected firstyear cost to an owner or operator of an 

OSV of at least 500 GT ITC. 

Using the expected value formula, 

Expected First-Year Cost = 

((247 existing DP vessels no compliance × 

$286,835) 

+ (265 existing DP vessels partial compliance

× $1,062) 

+ (418 existing vessels without DP × $0) 

+ (12 future DP vessels no compliance × 

$286,835) 

+ (17 future DP vessels partial compliance × 

$1,062))/(959 Total Vessels 

Affected) 

we estimate that the expected average 

first-year cost as a result of this 

proposed rule to owners or operators of 

OSVs of at least 500 GT ITC would be 

$77,778.88. 

Using this expected average first-year 

cost, we then estimate the first-year 

revenue impact to the small entities that 

we identified in Table 19. During the 

first-year of implementation, we 

estimate that 71 percent of these 14 

owners or operators would incur a cost 

less than 5 percent of their annual 

revenue stream. The remaining 28 

percent would incur costs less than 13 

percent of their annual revenue stream. 

TABLE 23—FIRST-YEAR REVENUE IMPACT TO SMALL ENTITIES THAT OWN

OSVS OF AT LEAST 500 GT ITC 

Revenue impact range 

Impact 

from first 

year 

costs 

Expected cost per vessel ............. $77,779 

0% < Impact < 1% ........................ 21% 

1% < Impact < 3% ........................ 21% 

3% < Impact < 5% ........................ 29% 

5% < Impact < 10% ...................... 7% 

Above 10% ................................... 21% 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

This proposed rule is also expected to 

have reoccurring costs. We estimate that 

the annual cost to owners or operators 

of OSVs of at least 500 GT ITC that meet 

none of the applicable provisions would 

be $2,573. 

Table 24 summarizes the reoccurring 

costs incurred by an owner or operator 

of a vessel that would not comply with 

any of the applicable provisions of this 

proposed rule. 

TABLE 24—ANNUAL COST TO AN EXISTING NON-COMPLIANT OSV OF AT LEAST 500 GT ITC 

Requirement First year cost 

Make Available DPO/DPOQ Training Certificates .............................................................................................................................. $42.90 

Replace DP–1 Crewboats ................................................................................................................................................................... 0.00 

Cost to receive DP–2 Class Notation .................................................................................................................................................. 0.00 

Conduct an FMEA ............................................................................................................................................................................... 0.00 

Develop a CAMO and ASOC .............................................................................................................................................................. 0.00 

Report DP System Incidents ............................................................................................................................................................... 170.87 

Conduct DP Incident Investigation And Write Report ......................................................................................................................... 2,236.19 

Report Serious Marine Incidents Resulting from DP Incident ............................................................................................................ 3.46 

Submit Annual DP Incident Investigation Report ................................................................................................................................ 169.10 

Obtain DPVAD ..................................................................................................................................................................................... 0.00 

Report DP Surveys .............................................................................................................................................................................. 4.10 

Submit DP Systems Plan .................................................................................................................................................................... 0.00 

Total .............................................................................................................................................................................................. 2,633.61 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

We estimate that all owners or 

operators of OSVs of at least 500 GT ITC 

would incur this cost following the first 

year. 

Using these total costs, we then 

estimate the expected annual cost to an 

owner or operator of an OSV of at least 

500 GT ITC. 

The estimated expected annual cost 

incurred by owners or operators of 

OSVs of at least 500 GT ITC is 

$1,485.70. This expected cost is 

estimated to be less than 0.1% of the 


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annual revenue of the two entities 

identified as small. 

Expected Cost to an OSV Less Than 500 

GT ITC 

During development of the phase-in 

schedule summarized in Table 2 of this 

Regulatory Analysis section, we realized 

that the risk profile of OSVs less than 

500 GT ITC that use DP on the U.S. OCS 

was much smaller than the risk profile 

of larger-sized vessels that use DP. As a 

result, we decided to grandfather these 

smaller existing vessels, not only from 

being required to use DP–2 or higher 

systems, but also from being required to 

comply with the FMEA, CAMO, ASOC, 

and DP failure and incident reporting 

requirements. 

We estimate that because of these less 

stringent requirements, the total firstyear cost of this NPRM to noncompliant 

owners or operators of existing OSVs 

less than 500 GT ITC is $126.00 per 

vessel. Table 25 summarizes the cost per 

proposed provision to these 

noncompliant vessels. 

TABLE 25—FIRST-YEAR COSTS TO AN EXISTING NON-COMPLIANT OSV LESS THAN 500 GT ITC 

Requirement First year cost 

Make Available DPO/DPOQ Training Certificates .............................................................................................................................. $114.40 

Replace DP–1 Crewboats ................................................................................................................................................................... 0.00 

Cost to receive DP–2 Class Notation .................................................................................................................................................. 0.00 

Conduct an FMEA ............................................................................................................................................................................... 0.00 

Develop a CAMO and ASOC .............................................................................................................................................................. 0.00 

Report DP System Incidents ............................................................................................................................................................... 0.00 

Conduct DP Incident Investigation And Write Report ......................................................................................................................... 0.00 

Report Serious Marine Incidents Resulting from DP Incident ............................................................................................................ 0.00 

Submit Annual DP Incident Investigation Report ................................................................................................................................ 0.00 

Obtain DPVAD ..................................................................................................................................................................................... 0.00 

Report DP Surveys .............................................................................................................................................................................. 0.00 

Submit DP Systems Plan .................................................................................................................................................................... 0.00 

Total .............................................................................................................................................................................................. 114.40 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

We expect that none of the existing 

population of OSVs less than 500 GT 

ITC that use DP would be in compliance 

with the proposed requirement that all 

DPOs and DPOQs make available to the 

Coast Guard upon request the 

certificates of completion from their DP 

training course. As such, the entire 

population of OSVs less than 500 GT 

ITC that use DP would incur a cost of 

$114.40 in the first year. 

Using the same methodology as 

before, we estimate the expected average 

cost to these owners or operators per 

vessel using the following formula: 

We estimate that the expected average 

first-year cost to owners or operators is 

$54.88 per vessel. Using this expected 

cost, we then analyze the expected 

impact on owners or operators 

identified as small entities in Table 20. 

During the first year of implementation, 

we estimate that all OSVs less than 500 

GT ITC would incur a cost of less than 

0.1 percent of their annual revenue 

stream. 

Table 26 summarizes the revenue 

impact that this NPRM would have on 

the existing population of small entities 

owning or operating OSVs less than 500 

GT ITC. 

TABLE 26—FIRST-YEAR REVENUE IMPACT TO SMALL ENTITIES THAT OWN

OSVS LESS THAN 500 GT ITC 

Revenue impact range 

Impact 

from first 

year 

costs 

Expected Cost per Vessel ............ $54.88 

0% < Impact < 1% ........................ 100% 

1% < Impact < 3% ........................ 0% 

3% < Impact < 5% ........................ 0% 

5% < Impact < 10% ...................... 0% 

Above 10% ................................... 0% 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

In subsequent years, vessel owners or 

operators of OSVs less than 500 GT ITC 

are expected to have costs slightly less 

than those estimated in Table 25 as a 

result of this proposed rule. We estimate 

that in later years, owners or operators 

of OSVs less than 500 GT ITC that use 

DP would incur a cost of $21.35 

annually. 

Table 27 summarizes the reoccurring 

costs that these owners or operators can 

expect if this proposed rule is 

implemented. 

TABLE 27—FIRST-YEAR COSTS TO AN EXISTING NON-COMPLIANT OSV LESS THAN 500 GT ITC 

Requirement First year cost 

Make Available DPO/DPOQ Training Certificates .............................................................................................................................. $44.50 

Replace DP–1 Crewboats ................................................................................................................................................................... 0.00 


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76Although the owner or operator has the option 

to not conduct Critical OSC activities or not use DP 

while conducting Critical OCS activities, the Coast 

Guard does not anticipate these to be likely 

alternatives, since these alternatives would 

effectively remove the vessel from being considered 

for future work from contractors. Therefore, the 

Coast Guard believes that the preferred option will 

be purchasing a DP–2 crewboat instead of a DP–1 

crewboat. 

77See the Cost section of this Regulatory Analysis 

for more detail on this cost. 

TABLE 27—FIRST-YEAR COSTS TO AN EXISTING NON-COMPLIANT OSV LESS THAN 500 GT ITC—Continued 

Requirement First year cost 

Cost to receive DP–2 Class Notation .................................................................................................................................................. 0.00 

Conduct an FMEA ............................................................................................................................................................................... 0.00 

Develop a CAMO and ASOC .............................................................................................................................................................. 0.00 

Report DP System Incidents ............................................................................................................................................................... 0.00 

Conduct DP Incident Investigation And Write Report ......................................................................................................................... 0.00 

Report Serious Marine Incidents Resulting from DP Incidents ........................................................................................................... 0.00 

Submit Annual DP Incident Investigation Report ................................................................................................................................ 0.00 

Obtain DPVAD ..................................................................................................................................................................................... 0.00 

Report DP Surveys .............................................................................................................................................................................. 0.00 

Submit DP Systems Plan .................................................................................................................................................................... 0.00 

Total .............................................................................................................................................................................................. 44.50 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

Again, we expect that all owners or 

operators of existing OSVs less than 500 

GT ITC that use DP would incur the full 

annual cost listed in Table 27. 

Using these estimated annual costs, 

we then calculate the expected annual 

cost to an owner or operator of an OSV 

less than 500 GT ITC. 

The estimated expected annual cost 

incurred by owners or operators of 

OSVs of at least 500 GT ITC is $21.35. 

We estimate the distribution of the 

revenue impact to small entities as a 

result of this expected annual cost to be 

the same as the distribution of the 

revenue impact as a result of expected 

first-year costs. Therefore, we estimate 

the impact for all owners or operators of 

OSVs less than 500 GT ITC to be less 

than 0.1 percent of their annual revenue 

streams. 

Expected Cost to a Crewboat 

Although existing crewboats that use 

DP while conducting critical OSC 

operations on the U.S. OCS would be 

grandfathered from having to comply 

with the most costly requirements in 

this proposed rule (replacing a DP–1 

system with a DP–2 or higher system, 

conducting an FMEA, and developing 

and maintaining a CAMO and ASOC), 

future crewboats would not be granted 

this luxury. 

In order to comply with the proposed 

DP equipment provision, it is likely that 

an owner or operator who had planned 

to build a crewboat with a DP–1 system 

to conduct Critical OCS Activities 

would instead need to purchase a larger 

vessel in order to meet the greater 

mechanical and structural demands of a 

DP–2 system.76 We estimate, then, that 

this proposed requirement would cost 

an owner or operator $876,237 in order 

to comply.77 It is unlikely, however, that 

a small entity would choose to pay this 

cost up-front. Instead, we assume that 

an owner or operator would finance the 

cost of this purchase over 10 years. We 

estimate that the annual mortgage 

payment would be $124,756 to finance 

this cost over 10 years at a 7-percent 

interest rate. We considered that less 

favorable financing terms, such as 

shorter loan durations or higher 

mortgage rates, would be possible. In 

those cases, the annual cost would be 

higher. 

Table 28 summarizes, by proposed 

requirement, the first-year cost to 

owners or operators of future crewboats 

that did not meet any of the applicable 

provisions in this proposed rule. 

TABLE 28—FIRST-YEAR COSTS TO A FUTURE NON-COMPLIANT CREWBOAT

Requirement First year cost 

Make Available DPO/DPOQ Training Certificates .............................................................................................................................. $114.10 

Replace DP–1 Crewboats ................................................................................................................................................................... 124,756.44 

Cost to receive DP–2 Class Notation .................................................................................................................................................. 64,250.00 

Conduct an FMEA ............................................................................................................................................................................... 275,000.00 

Develop a CAMO and ASOC .............................................................................................................................................................. 9,120.00 

Report DP System Incidents ............................................................................................................................................................... 177.87 

Conduct DP Incident Investigation And Write Report ......................................................................................................................... 2,236.19 

Report Serious Marine Incidents Resulting from DP Incident ............................................................................................................ 3.46 

Submit Annual DP Incident Investigation Report ................................................................................................................................ 169.10 

Obtain DPVAD ..................................................................................................................................................................................... 10.25 

Report DP Surveys .............................................................................................................................................................................. 4.10 

Submit DP Systems Plan .................................................................................................................................................................... 0.00 

Total .............................................................................................................................................................................................. 475,841.80 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

Table 28 shows that the estimated 

first-year cost to owners or operators of 

future crewboats that would not meet 

any of the requirements in this proposed 

rule is, after financing, $475,841.80 per 

vessel. 


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78Through statistical analysis, we estimate that 1 

crewboats per year would incur the full cost listed 

in Table 28 in the first three years following 

issuance of a final rule. 

79These percentages are based on a review of all 

existing crewboats’ vessel specifics, 13 crewboats 

list DP–1 systems, 30 list DP–2 systems, and 224 list 

no DP system. 

However, this cost would only be 

incurred by a small percentage of 

owners that would have built a DP–1 

crewboat in the absence of this 

proposed rule. In addition to these 

owners, we estimate that there would be 

some owners who would incur a smaller 

cost, because they are expected to build 

crewboats with DP–2 systems even in 

the absence of this proposed rule. 

Finally, we expect that there will be 

some owners who would choose not to 

build a crewboat with DP, and therefore, 

would not incur costs from this 

proposed rule.78

In addition to new builds, owners or 

operators of existing crewboats that use 

DP systems would also incur a cost to 

comply with the reporting requirements 

of this proposed rule. Using publicly 

available data on vessel specifics, we 

estimate that, of existing vessels that use 

DP, 30 percent use DP–1 systems, with 

the remainder using DP–2 systems.79

Further, there are 224 crewboats 

currently operating in U.S. waters that 

do not use DP systems. 

We estimate that this proposed rule 

would result in a first-year cost of 

$114.40 per vessel to owners or 

operators of existing crewboats that use 

DP systems, as they would be 

grandfathered from being required to 

comply with most of the requirements 

in this proposed rule. 

Table 29 summarizes this estimated 

cost. 

TABLE 29—FIRST-YEAR COSTS TO AN EXISTING NON-COMPLIANT CREWBOAT

Requirement First year cost 

Make Available DPO/DPOQ Training Certificates .............................................................................................................................. $114.40 

Replace DP–1 Crewboats ................................................................................................................................................................... 0.00 

Cost to receive DP–2 Class Notation .................................................................................................................................................. 0.00 

Conduct an FMEA ............................................................................................................................................................................... 0.00 

Develop a CAMO and ASOC .............................................................................................................................................................. 0.00 

Report DP System Incidents ............................................................................................................................................................... 0.00 

Conduct DP Incident Investigation And Write Report ......................................................................................................................... 0.00 

Report Serious Marine Incidents Resulting from DP Incident ............................................................................................................ 0.00 

Submit Annual DP Incident Investigation Report ................................................................................................................................ 0.00 

Obtain DPVAD ..................................................................................................................................................................................... 0.00 

Report DP Surveys .............................................................................................................................................................................. 0.00 

Submit DP Systems Plan .................................................................................................................................................................... 0.00 

Total .............................................................................................................................................................................................. 114.40 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

Although the first-year cost to owners 

or operators for future builds is 

estimated to be large, this cost will be 

borne by only a small percentage of 

crewboat owners or operators. Because 

we assume, for simplicity, that these 

owners or operators already own or 

operate crewboats that are in operation 

today, we calculate the expected firstyear cost to the existing eight crewboat 

owners or operators in business today. 

Using the expected value formula, 

we estimate that the expected average 

first-year cost to crewboat owners or 

operators would be $4,381.23 as a result 

of this proposed rule. 

Using this expected average first-year 

cost, we then estimate the first-year 

revenue impact to the three small 

entities identified earlier in Table 21. 

During the first-year of implementation, 

we estimate that 67 percent of these 

owners or operators would incur a cost 

less than 1 percent of their annual 

revenue stream. The other owners or 

operators would incur costs less than 3 

percent of their annual revenue stream. 

Table 30 summarizes the revenue 

impact that this NPRM would have on 

the existing population of small 

crewboat owners. 

TABLE 30—FIRST-YEAR REVENUE IMPACT TO SMALL ENTITIES THAT OWN

CREWBOATS

Revenue impact range 

Impact from 

first year 

costs 

Expected Cost per Vessel ........ $4,381.23 

0% < Impact <1% ..................... 67% 

1% < Impact <3% ..................... 33% 

3% < Impact <5% ..................... 0% 

5% < Impact <10% ................... 0% 

Above 10% ............................... 0% 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

In subsequent years, we expect that 

the annual cost to comply with this 

NRPM would decrease significantly for 

owners or operators of newly-built 

crewboats and slightly for owners or 

operators of existing crewboats. 

Table 31 summarizes the annual cost 

to an owner or operator of a new 

crewboat that would not have met the 

design standards of this proposed rule. 


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TABLE 31—ANNUAL COSTS TO A FUTURE NON-COMPLIANT CREWBOAT

Requirement First year cost 

Make Available DPO/DPOQ Training Certificates .............................................................................................................................. $44.50 

Replace DP–1 Crewboats ................................................................................................................................................................... 124,756.44 

Cost to receive DP–2 Class Notation .................................................................................................................................................. 0.00 

Conduct an FMEA ............................................................................................................................................................................... 0.00 

Develop a CAMO and ASOC .............................................................................................................................................................. 0.00 

Report DP System Incidents ............................................................................................................................................................... 177.87 

Conduct DP Incident Investigation And Write Report ......................................................................................................................... 2,236.19 

Report Serious Marine Incidents Resulting from DP Incident ............................................................................................................ 3.46 

Submit Annual DP Incident Investigation Report ................................................................................................................................ 169.10 

Obtain DPVAD ..................................................................................................................................................................................... 0.00 

Report DP Surveys .............................................................................................................................................................................. 4.10 

Submit DP Systems Plan .................................................................................................................................................................... 0.00 

Total .............................................................................................................................................................................................. 127,391.65 

* Numbers may not add due to rounding. 

* Dollar figures are in 2013 terms. 

For future builds that would meet the 

DP design standards even in the absence 

of this proposed rule, the estimated 

annual cost to owners or operators is 

$2,635.21. Lastly, we estimate that 

owners or operators of existing 

crewboats that use DP would incur an 

annual cost of $44.50. 

Using the same formula we used 

above, we calculate the expected annual 

cost per vessel to a crewboat owner or 

operator. 

We estimate that the expected annual 

cost to crewboat owners or operators is 

$498.43 per vessel as a result of this 

proposed rule. After the first year of 

implementation, all crewboat owners 

who are defined as small entities would 

incur a cost less than 0.01 percent of 

their revenue stream annually. 

5. An Identification, to the Extent 

Practicable, of All Relevant Federal 

Rules That May Duplicate, Overlap, or 

Conflict With the Proposed Rule 

There are no relevant Federal rules 

that may duplicate, overlap, or conflict 

with the proposed rule. 

6. A Description of any Significant 

Alternatives to the Proposed Rule That 

Accomplish the Stated Objectives of 

Applicable Statutes and That Minimize 

Any Significant Economic Impact of the 

Proposed Rule on Small Entities 

Because of the frequency of DPrelated incidents, as well as the severe 

consequences that could occur as the 

result of an incident, we decided that 

the benefits that would be gained 

through requiring compliance from 

existing OSVs and crewboats would 

outweigh any additional costs that 

would be incurred by industry. 

To minimize the impact on existing 

OSVs and crewboats, we developed the 

proposed alternative, which uses a 

phase-in schedule to provide existing 

non-drilling vessels with some 

flexibility in meeting the provisions of 

this proposed alternative. Further, we 

decided to grandfather existing nondrilling vessels from being required to 

comply with the most costly provisions 

in this proposed rule, namely, the 

provisions that would require a vessel 

using DP to use a DP–2 system or higher 

and obtain a DP–2 or higher class 

notation. 

By providing flexibility to existing 

OSVs and crewboats, the proposed 

alternative minimizes costs without 

sacrificing benefits that could accrue 

from a larger population of vessels. 

If you think that your business, 

organization, or governmental 

jurisdiction qualifies as a small entity 

and that this NPRM would have a 

significant economic impact on it, 

please submit a comment to the Docket 

Management Facility at the address 

under the ‘‘Public Participation and 

Request for Comments’’ section of this 

preamble. 

C. Assistance for Small Entities 

Under section 213(a) of the Small 

Business Regulatory Enforcement 

Fairness Act of 1996 (Pub. L. 104–121), 

we want to assist small entities in 

understanding this NPRM so that they 

can better evaluate its effects on them 

and participate in the rulemaking. If the 

NPRM would affect your small business, 

organization, or governmental 

jurisdiction and you have questions 

concerning its provisions or options for 

compliance, please consult LT Jeff 

Bybee, Project Manager, CG–ENG–1, 

Coast Guard, telephone 202–372–1357. 

The Coast Guard will not retaliate 

against small entities that question or 

complain about this proposed rule or 

any policy or action of the Coast Guard. 

Small businesses may send comments 

on the actions of Federal employees 

who enforce, or otherwise determine 

compliance with, Federal regulations to 

the Small Business and Agriculture 

Regulatory Enforcement Ombudsman 

and the Regional Small Business 

Regulatory Fairness Boards. The 

Ombudsman evaluates these actions 

annually and rates each agency’s 

responsiveness to small business. If you 

wish to comment on actions by 

employees of the Coast Guard, call 1– 

888–REG–FAIR (1–888–734–3247). 

D. Collection of Information 

This NPRM would call for a collection 

of information under the Paperwork 

Reduction Act of 1995 (44 U.S.C. 3501– 

3520). As defined in 5 CFR 1320.3(c), 

‘‘collection of information’’ comprises 

reporting, recordkeeping, monitoring, 

posting, labeling, and other, similar 

actions. The title and description of the 

information collections, a description of 

those who must collect the information, 


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80This is calculated from the sum of the projected 

affected population figures listed earlier in this 

analysis (610 OSVs, 59 MODUs, 46 crewboats, and 

4 DPSAOs). 

81This is calculated from the sum of the projected 

affected population figures at the end of the three 

year collection period of the analysis (652 OSVs, 73 

MODUs, 53 crewboats, and 6 DPSAOs). 

82These numbers are based on the assumption 

that each entity will need eight DPOs or DPOQs on 

staff. 

and an estimate of the total annual 

burden follow. The estimate covers the 

time for reviewing instructions, 

searching existing sources of data, 

gathering and maintaining the data 

needed, and completing and reviewing 

the collection. 

Title: Requirements for MODUs and 

Other Vessels Conducting Outer 

Continental Activities with Dynamic 

Positioning Systems. 

OMB Control Number: 1625—NEW. 

Summary Of The Collection Of 

Information: Title 33 CFR Sections 

140.315, 140.335, and Title 46 CFR 

61.50–4, 61.50–3, 61.50–2, and 62.20–2 

of this NPRM would have COI 

requirements for vessel owners or 

operators, and authorized DP assurance 

providers (DPSAOs). Section 140.315 

would require owners or operators to 

provide the Coast Guard proof of the 

training records for their DPOs and 

DPOQs within 48 hours of a request. 

Section 140.335 (j) would require a 

vessel owner or operator to report to the 

cognizant OCMI a DP incident that 

results in either an emergency 

disconnect or a serious marine incident 

as defined by 46 CFR 4.03–2. 

Proposed § 61.50–4 would require an 

authorized DP assurance provider to 

submit a DP incident investigation 

report annually to OCS NCOE if the 

vessel is a MODU conducting Critical 

OCS Activities; is a vessel other than a 

MODU conducting Critical OCS 

Activities while using a DP system 

installed after the effective date of a 

final rule; or is a vessel other than a 

MODU conducting Critical OCS 

Activities, and is greater than 500 GT 

ITC and uses a DP system installed prior 

to the effective date of the final rule. 

Section 61.50–3 would require a 

prospective DP assurance organization 

to submit an application to the OCS 

NCOE prior to being recognized by the 

Coast Guard as an authorized DPSAO. 

Sections 61.50–2 would require the 

DPSAO conducting a vessel’s DP survey 

to notify the cognizant OCMI of the time 

and location of a DP initial and annual 

survey at least 30 days prior to when the 

survey would take place. Finally, 

§ 62.20–2 would require an DPSAO to 

submit a copy of the DP system plan for 

each MODU or other vessel of at least 

6,000 GT ITC that uses a DP system to 

conduct Critical OCS Activities. 

Need for Information: The Coast 

Guard is requesting this information to 

determine whether a vessel satisfies the 

new regulatory requirements for vessel 

designs and operations, DP surveys, and 

DPO and DPOQ training. Furthermore, 

this information is required to better 

understand why DP system incidents 

occur. 

Proposed Use of Information: The 

Coast Guard would use this information 

to determine whether a vessel satisfies 

the new regulatory requirements for 

vessel designs and operations, DP 

surveys, and DPO and DPOQ training. 

This information also would be used to 

better understand why DP system 

incidents occur. 

Description of the Respondents: The 

respondents would be vessel owners or 

operators, ship engineers, and 

authorized DPSAOs of U.S.- and 

foreign-flag OSVs and MODUs that 

operate on the U.S. OCS. 

Number of Respondents: This NPRM, 

if promulgated, would have 719 

respondents in the first year after the 

effective date of a final rule.80 Over the 

course of the 3-year collection period, 

there would be 784 respondents.81

Frequency of Response: The number 

of responses per year of this NPRM 

would vary by requirement. Owners or 

operators must provide proof of training 

for each DPO and DPOQ employed (we 

expect eight training certificates would 

need to be made available during the 

first year and three training certificates, 

on average, in subsequent years, to 

account for a worker turnover rate of 

38.9 percent per year).82 Owners or 

operators would be required to report, to 

the cognizant OCMI, DP incidents that 

result in an emergency disconnect or 

serious marine incident, which we 

estimate would occur at a rate of 0.19 

and 0.05 per vessel per year, 

respectively. An authorized DP 

assurance provider would need to 

submit an application to the OCS NCOE 

in order to become an authorized 

DPSAO. 

Additionally, the DPSAO would need 

to submit an annual summary report, 

per vessel, of DP incidents 

investigations that were conducted 

throughout the year. A DPSAO would 

also be required to submit a vessel’s DP 

system plan once. Finally, an authorized 

DPSAO would need to report the time 

and location of their initial DP survey 

once per vessel, as well as report the 

time and location of their annual DP 

survey once per year per vessel starting 

in the second year. 

Burden of Response: The burden per 

response for each regulatory 

requirement varies. Details are shown in 

Table 32 for the burden to industry. 

TABLE 32—SUMMARY OF INDUSTRY BURDEN FROM COLLECTION OF INFORMATION

PRA Item 

Total annual 

number of 

responses 

Average 

burden per 

response 

(in hours) 

Total annual 

burden 

(in hours) 

Make Available Certificates of Training Completion for DPOs/DPOQs Year 1 [140.315(d)] ... 5,720 0.1 572 .0 

Make Available Certificates of Training Completion for DPOs/DPOQs Year 2 [140.315(d)] ... 2,545 0.1 254 .5 

Make Available Certificates of Training Completion for DPOs/DPOQs Year 3 [140.315(d)] ... 2,534 0.1 253 .4 

Submit Annual DP Failure Investigation Report to OCMI Year 1 [61.50–4(b)] ........................ 89 4.0 356 .0 

Submit Annual DP Failure Investigation Report to OCMI Year 2 [61.50–4(b)] ........................ 129 4.0 516 .0 

Submit Annual DP Failure Investigation Report to OCMI Year 3 [61.50–4(b)] ........................ 152 4.0 608 .0 

Report DP Failures that Result in Emergency Disconnects to OCMI Year 1 [140.335(j)] ....... 16 0.3 5 .3 

Report DP Failures that Result in Emergency Disconnects to OCMI Year 2 [140.335(j)] ....... 18 0.3 6 .0 

Report DP Failures that Result in Emergency Disconnects to OCMI Year 3 [140.335(j)] ....... 20 0.3 6 .7 

Report DP Failures that Result in Serious Marine Incidents to OCMI Year 1 [140.335(j)] ...... 6 0.3 2 .0 

Report DP Failures that Result in Serious Marine Incidents to OCMI Year 2 [140.335(j)] ...... 9 0.3 3 .0 

Report DP Failures that Result in Serious Marine Incidents to OCMI Year 3 [140.335(j)] ...... 11 0.3 3 .7 

Submit DPSAO Application to OCSNCOE Year 1 [61.50–3] ................................................... 4 30.0 120 .0 

Submit DPSAO Application to OCSNCOE Year 2 [61.50–3] ................................................... 1 30.0 30 .0 

Submit DPSAO Application to OCSNCOE Year 3 [61.50–3] ................................................... 1 30.0 30 .0 


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TABLE 32—SUMMARY OF INDUSTRY BURDEN FROM COLLECTION OF INFORMATION—Continued 

PRA Item 

Total annual 

number of 

responses 

Average 

burden per 

response 

(in hours) 

Total annual 

burden 

(in hours) 

Report Initial Surveys to OCMI Year 1 [61.50–2] ..................................................................... 89 0.1 8 .9 

Report Initial Surveys to OCMI Year 2 [61.50–2] ..................................................................... 40 0.1 4 .0 

Report Initial Surveys to OCMI Year 3 [61.50–2] ..................................................................... 23 0.1 2 .3 

Report Annual Surveys to OCMI Year 1 [61.50–2] ................................................................... ........................ 0.1 ..........................

Report Annual Surveys to OCMI Year 2 [61.50–2] ................................................................... 89 0.1 8 .9 

Report Annual Surveys to OCMI Year 3 [61.50–2] ................................................................... 129 0.1 12 .9 

Submit DP System Plans to MSC Year 1 [62.20–2] ................................................................. 64 0.5 32 .0 

Submit DP System Plans to MSC Year 2 [62.20–2] ................................................................. 13 0.5 6 .5 

Submit DP System Plans to MSC Year 3 [62.20–2] ................................................................. 11 0.5 5 .5 

Total: Year 1 ....................................................................................................................... 5,988 ........................ 1,096 

Total: Future Years ............................................................................................................. 5,725 ........................ 1,751 

Total ............................................................................................................................. 11,713 ........................ 2,848 

Estimate of Total Annual Burden: 

This NPRM would have a first-year 

burden on industry of approximately 

1,096 hours. The average annual burden 

on industry of this NPRM would be 

approximately 876 hours. 

E. Federalism 

A rule has implications for federalism 

under E.O. 13132 (‘‘Federalism’’), if it 

has a substantial direct effect on the 

States, on the relationship between the 

national government and the States, or 

on the distribution of power and 

responsibilities among the various 

levels of government. We have analyzed 

this NPRM under E.O. 13132 and have 

determined that it is consistent with the 

fundamental federalism principles and 

preemption requirements described in 

E.O. 13132. Our analysis follows. 

It is well settled that States may not 

regulate in categories reserved for 

regulation by the Coast Guard. It is also 

well settled, now, that all of the 

categories covered in 46 U.S.C. 3306, 

3703, 7101, and 8101 (design, 

construction, alteration, repair, 

maintenance, operation, equipping, 

personnel qualification, and manning of 

vessels), as well as the reporting of 

casualties and any other category in 

which Congress intended the Coast 

Guard to be the sole source of a vessel’s 

obligations, are within fields foreclosed 

from regulation by the States. (See the 

decision of the Supreme Court in the 

consolidated cases of United States v. 

Locke and Intertanko v. Locke, 529 U.S. 

89, 120 S.Ct. 1135 (March 6, 2000).) 

This NPRM addresses the design, 

construction, maintenance, operation, 

training, and personnel qualification of 

MODUs and other vessels equipped 

with DP systems. For the portions of 

this NPRM that are promulgated under 

the authorities of 46 U.S.C. 3306, 3703, 

7101, and 8101, the States may not 

regulate within these fields. Thus, these 

rules are consistent with the principles 

of federalism and preemption 

requirements in E.O. 13132. 

Additionally, for those portions of 

this NPRM that are promulgated under 

the authority of 43 U.S.C. 1333, States 

are also field preempted from 

prescribing safety regulations on the 

OCS. Congress specifically granted the 

exclusive authority, through delegation 

by the DHS Secretary, to the Coast 

Guard, stating that the Coast Guard 

‘‘shall have the authority to promulgate 

and enforce such reasonable regulations 

with respect to lights and other warning 

devices, safety equipment, and other 

matters relating to the promotion of 

safety of life and property on the 

artificial islands, installations, and other 

devices’’ or on ‘‘the waters adjacent 

thereto’’ on the OCS. Furthermore, 

States do not have jurisdiction to 

regulate on the OCS. Because states may 

not regulate within these categories on 

the OCS, this proposed rule is 

consistent with the principles of 

federalism and preemption 

requirements in E.O. 13132. 

While it is well settled that States may 

not regulate in categories in which 

Congress intended the Coast Guard to be 

the sole source of authority to issue 

regulations, the Coast Guard recognizes 

the key role that State and local 

governments may have in making 

regulatory determinations. Additionally, 

for rules with federalism implications 

and preemptive effect, E.O. 13132 

specifically directs agencies to consult 

with State and local governments during 

the rulemaking process. If you believe 

this proposed rule would have 

implications for federalism under E.O. 

13132, please contact the person listed 

in the FOR FURTHER INFORMATION

CONTACT section of this preamble. 

F. Unfunded Mandates Reform Act 

The Unfunded Mandates Reform Act 

of 1995, 2 U.S.C. 1531–1538, requires 

Federal agencies to assess the effects of 

their discretionary regulatory actions. In 

particular, the Act addresses actions 

that may result in the expenditure by a 

State, local, or tribal government, in the 

aggregate, or by the private sector of 

$100,000,000 (adjusted for inflation) or 

more in any 1 year. Though this NPRM 

would not result in such an 

expenditure, we do discuss the effects of 

this NPRM elsewhere in this preamble. 

G. Taking of Private Property 

This NPRM would not cause a taking 

of private property or otherwise have 

taking implications under E.O. 12630, 

Governmental Actions and Interference 

with Constitutionally Protected Property 

Rights. 

H. Civil Justice Reform 

This NPRM satisfies applicable 

standards in sections 3(a) and 3(b)(2) of 

E.O. 12988, Civil Justice Reform, to 

minimize litigation, eliminate 

ambiguity, and reduce burden. 

I. Protection of Children 

We have analyzed this NPRM under 

E.O. 13045, Protection of Children from 

Environmental Health Risks and Safety 

Risks. This NPRM is not an 

economically significant rule and would 

not create an environmental risk to 

health or risk to safety that might 

disproportionately affect children. 

J. Indian Tribal Governments 

This NPRM does not have tribal 

implications under E.O. 13175, 

Consultation and Coordination with 


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Indian Tribal Governments, because it 

would not have a substantial direct 

effect on one or more Indian tribes, on 

the relationship between the Federal 

Government and Indian tribes, or on the 

distribution of power and 

responsibilities between the Federal 

Government and Indian tribes. 

K. Energy Effects 

We have analyzed this NPRM under 

E.O. 13211, Actions Concerning 

Regulations That Significantly Affect 

Energy Supply, Distribution, or Use. We 

have determined that it is not a 

‘‘significant energy action’’ under that 

order because it is not a ‘‘significant 

regulatory action’’ under E.O. 12866 and 

is not likely to have a significant 

adverse effect on the supply, 

distribution, or use of energy. 

L. Technical Standards 

The National Technology Transfer 

and Advancement Act, codified as a 

note to 15 U.S.C. 272, directs agencies 

to use voluntary consensus standards in 

their regulatory activities unless the 

agency provides Congress, through 

OMB, with an explanation of why using 

these standards would be inconsistent 

with applicable law or otherwise 

impractical. Voluntary consensus 

standards are technical standards (e.g., 

specifications of materials, performance, 

design, or operation; test methods; 

sampling procedures; and related 

management systems practices) that are 

developed or adopted by voluntary 

consensus standards bodies. 

This NPRM uses the following 

voluntary consensus standards: 

• IEC 60092–504—Electrical 

Installation in Ships—Part 504: 

Special Features—Control and 

Instrumentation Third Edition, 2001 

(‘‘IEC 60092–504’’) 

• IMO Circular 645—Guidelines for 

Vessels with Dynamic Positioning 

Systems, 1994 (‘‘IMO MSC/Circ.645’’) 

• Marine Technology Society DP 

Operations Guidance (‘‘MTS DP 

Operations Guide’’), Part 1, October 

2010 

• Marine Technology Society DP 

Operations Guidance (‘‘MTS DP 

Operations Guide’’), Part 2, Appendix 

1, March 2012 

• Marine Technology Society DP 

Operations Guidance (‘‘MTS DP 

Operations Guide’’), Part 2, Appendix 

2, July 2012 

• Marine Technology Society DP 

Operations Guidance (‘‘MTS DP 

Operations Guide’’), Part 2, Appendix 

3, July 2012 

The proposed sections that reference 

these standards and the locations where 

these standards are available are listed 

in 33 CFR 140.7, and 46 CFR 61.03–1, 

and 62.05–1. If you disagree with our 

analysis of the voluntary consensus 

standards listed above or are aware of 

voluntary consensus standards that 

might apply but are not listed, please 

send a comment to the docket using one 

of the methods under ADDRESSES. In 

your comment, please explain why you 

disagree with our analysis and/or 

identify voluntary consensus standards 

we have not listed that might apply. 

M. Environment 

We have analyzed this NPRM under 

Department of Homeland Security 

Management Directive 023–1 and 

Commandant Instruction M16475.lD, 

which guide the Coast Guard in 

complying with the National 

Environmental Policy Act of 1969 

(NEPA)(42 U.S.C. 4321–4370f), and 

have made a preliminary determination 

that there are no factors in this case that 

would limit the use of a categorical 

exclusion under section 2.B.2 of the 

Instruction. Therefore, this NPRM is 

categorically excluded from further 

environmental documentation under 

figure 2–1, paragraphs (34)(a),(c),(d), 

and (e) of the Instruction, which 

exclude regulations that are editorial or 

procedural and regulations concerning: 

Internal agency functions or 

organization; training, qualifying, 

licensing and disciplining of maritime 

personnel; manning, documentation, 

inspection and equipping of vessels; 

and equipment approval and carriage 

requirements. This NPRM is also 

categorically excluded under paragraph 

6(a) of the Appendix to National 

Environmental Policy Act: Coast Guard 

Procedures for Categorical Exclusions, 

Notice of Final Agency Policy, 

published in the Federal Register on 

July 23, 2002 (67 FR 48243), which 

excludes regulations concerning vessel 

operation and safety standards. The 

environmental impact associated with 

requiring additional equipment, 

training, and improved facilities will be 

insignificant. An ‘‘Environmental 

Analysis Check List’’ is available in the 

docket by following the instructions in 

the ‘‘Viewing comments and 

documents’’ section above. 

List of Subjects 

33 CFR Part 140 

Continental shelf, Incorporation by 

reference, Investigations, Marine safety, 

Occupational safety and health, 

Penalties, Reporting and recordkeeping 

requirements. 

33 CFR Part 143 

Continental shelf, Marine safety, 

Occupational safety and health, Vessels. 

33 CFR Part 146 

Continental shelf, Marine safety, 

Occupational safety and health, 

Reporting and recordkeeping 

requirements, Vessels. 

46 CFR Part 61 

Incorporation by reference, Reporting 

and recordkeeping requirements, 

Vessels. 

46 CFR Part 62 

Incorporation by reference, Reporting 

and recordkeeping requirements, 

Vessels. 

For the reasons discussed in the 

preamble, the Coast Guard proposes to 

amend 33 CFR parts 140, 143, and 146, 

and 46 CFR parts 61 and 62 as follows: 

Title 33—Navigation and Navigable 

Waters 

PART 140—GENERAL 

■ 1. The authority citation for part 140 

continues to read as follows: 

Authority: 43 U.S.C. 1333, 1348, 1350, 

1356; Department of Homeland Security 

Delegation No. 0170.1. 

■ 2. Revise § 140.7 to read as follows: 

§ 140.7 Incorporation by reference. 

(a) Certain material is incorporated by 

reference into this part with the 

approval of the Director of the Federal 

Register under 5 U.S.C. 552(a) and 1 

CFR part 51. To enforce any edition 

other than that specified in this section, 

the Coast Guard must publish a notice 

of change in the Federal Register and 

the material must be available to the 

public. All approved material is 

available for inspection at the U.S. Coast 

Guard, Office of Design and Engineering 

Standards (CG–ENG), 2703 Martin 

Luther King Jr. Ave., SE., Stop 7509, 

Washington, DC 20593–7509, and is 

available from the sources listed below. 

It is also available for inspection at the 

National Archives and Records 

Administration (NARA). For 

information on the availability of this 

material at NARA, call 202–741–6030, 

or go to http://www.archives.gov/

federal_register/code_of_federal_

regulations/ibr_locations.html. 

(b) American National Standards 

Institute (ANSI), 11 West 42nd Street, 

New York, NY 10036, http://

www.ansi.org/. 

(1) ANSI A10.14–1975—Requirements 

for Safety Belts, Harnesses, Lanyards, 

Lifelines, and Drop Lines for 

Construction and Industrial Use, IBR 

approved for § 142.42. 


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83The Coast Guard would provide industry with 

advance notice and an opportunity to provide input 

before determining that additional activities meet 

the definition of critical OCS activities on a MODU. 

84The Coast Guard would provide industry with 

advance notice and an opportunity to provide input 

before determining that additional activities meet 

the definition of critical OCS activities on vessels 

other than MODUs. 

(2) ANSI/UL1123–1987—Standard for 

Marine Buoyant Devices, IBR approved 

for § 143.405. 

(3) ANSI Z41–1983—American 

National Standard for Personal 

Protection-Protective Footwear, IBR 

approved for § 142.33. 

(4) ANSI Z87.1–1979—Practice for 

Occupational and Educational Eye and 

Face Protection, IBR approved for 

§ 142.27. 

(5) ANSI Z88.2–1980—Practices for 

Respiratory Protection, IBR approved for 

§ 142.39. 

(6) ANSI Z89.1–1981—Safety 

Requirements for Industrial Head 

Protection, IBR approved for § 142.30. 

(c) International Maritime 

Organization (IMO), 4 Albert 

Embankment, London SE1 7SR, +44 

(0)20 7735 7611, http://www.imo.org. (1) 

IMO Assembly Resolution A.414 (XI) 

Code for Construction and Equipment of 

Mobile Offshore Drilling Units, IBR 

approved for §§ 143.207 and 146.205. 

(2) IMO MSC/Circ.645—Guidelines 

for Vessels with Dynamic Positioning 

Systems, 1994 (‘‘IMO MSC/Circ.645’’), 

IBR approved for § 140.325. 

(3) The International Convention on 

Standards of Training, Certification and 

Watchkeeping for Seafarers, 1978, as 

amended (the STCW Convention or the 

STCW), IBR approved for § 140.320. 

(4) The Seafarers’ Training, 

Certification and Watchkeeping Code, as 

amended (the STCW Code), IBR 

approved for § 140.320. 

(d) Marine Technology Society (MTS), 

1100 H Street NW., Suite LL–100, 

Washington, DC 20005, 202–717–8705, 

http://www.mtsociety.org. 

(1) MTS DP Operations Guidance for 

MODUs (March 2012), Project 

Construction Vessels (July 2012), 

Logistics Vessels (July 2012), IBR 

approved for § 140.335. 

(2) Reserved. 

■ 3. Add new subpart D, consisting of 

§§ 140.300 through 140.350, to read as 

follows: 

Subpart D—Dynamic Positioning Systems 

Sec. 

140.300 Applicability. 

140.305 Definitions. 

140.310 DP system personnel requirements. 

140.315 DP system training requirements. 

140.320 DP system manning requirements. 

140.325 Operations. 

140.330 Minimum DP system requirements. 

140.335 Intermediate DP system 

requirements. 

140.340 Standard DP system requirements. 

140.345 Enhanced DP system requirements. 

140.350 Operational Control. 

Subpart D—Dynamic Positioning 

Systems 

§ 140.300 Applicability. 

This subpart applies to all MODUs 

and vessels other than MODUs that use 

a dynamic positioning (DP) system to 

engage in Outer Continental Shelf (OCS) 

activities on the U.S. OCS. 

§ 140.305 Definitions. 

The following definitions apply 

throughout this subpart: 

Activity Specific Operating Criteria 

(ASOC) means criteria that set out the 

operational, environmental, and 

equipment performance limits 

considered necessary for safe dynamic 

positioning (DP) system operations 

while carrying out a specific activity. 

The ASOC sets out various levels of 

operator action as these limits are 

approached or exceeded and varies 

depending on the activity. The ASOC 

defines whether the DP system must be 

configured in its Critical Activity Mode 

of Operation (CAMO) during that 

specific activity. If the CAMO is 

required for that specific activity, the 

ASOC will require the vessel to cease 

operations when an equipment failure 

makes operation in CAMO impossible. 

Critical Activity Mode of Operation 

(CAMO) means a tabulated presentation 

of how to configure the vessel’s DP 

system, including power generation and 

distribution, and propulsion and 

position reference systems, so that the 

DP system as a whole is fault-tolerant 

and fault-resistant. The CAMO is 

validated by a Failure Modes and Effects 

Analysis (FMEA) proving test at the 

initial survey described in § 61.50–5 of 

this subchapter. 

Critical OCS Activities means OCS 

activities where maintaining station is 

critical because a loss of position could 

cause a personal injury, environmental 

pollution, or catastrophic damage. See 

§ 140.10 of this subchapter for the 

definition of OCS activity. 

Critical OCS Activities on a MODU 

means OCS activities where a loss of 

position could cause a major process 

safety incident, such as a loss of well 

control where flow reaches the MODU, 

or water. These OCS activities include 

but are not limited to: Well test and 

completion operations; running nonsheareables such as drill collars through 

the Blowout Preventer (BOP); and an 

OCS activity on a well where 

hydrostatic balance is lost and BOP 

rams are used to maintain well control. 

The Coast Guard may identify other 

activities that fall within this 

definition.83 Each MODU that engages 

in Critical OCS Activities must include 

those activities in the MODU’s WSOC. 

Critical OCS Activities on Vessels 

Other than MODUs means OCS 

activities where a loss of position could 

cause a serious marine incident as 

defined by 46 CFR 4.03–2. These OCS 

activities include but are not limited to: 

OCS activities where loss of position 

risks a collision with a production riser; 

transfer of oil or other hazardous 

material while underway; personnel 

transfer between vessels or structures 

while underway; and engaging in diving 

support or remotely operated vehicle 

operations when maintaining station is 

critical. The Coast Guard may identify 

other activities that fall within this 

definition.84 Each vessel that engages in 

Critical OCS Activities must include 

those activities in the vessel’s ASOC. 

Dynamic Positioning Operator or DPO 

means a mariner who holds a credential 

as a rating forming part of the 

navigational watch, able seafarer-deck, 

operational-level deck officer, chief 

mate, master, a rating forming part of 

the engineering watch, able seafarerengine, operational-level engineer 

officer, second engineer, or chief 

engineer; and has completed the 

applicable training requirements of 33 

CFR 140.310 and, if applicable, 33 CFR 

140.315. 

Dynamic Positioning Operator, 

Qualified or DPOQ means a mariner 

who holds a credential as a rating 

forming part of the navigational watch, 

able seafarer-deck, operational-level 

deck officer, chief mate, master, rating 

forming part of the engineering watch, 

able seafarer-engine, operational-level 

engineer officer, second engineer, or 

chief engineer; has completed the 

applicable training requirements of 33 

CFR 140.310 and, if applicable, § 33 

CFR 140.315 for that specific vessel; and 

has obtained the written endorsement of 

the vessel’s DPO and master for that 

specific DP system. 

Dynamic Positioning System or DP 

System is defined in 46 CFR 62.10–1. 

Direct communication, for purposes 

of 33 CFR 140.310 only, means being in 

the direct line of sight of the officer in 

charge of the navigational watch, or 

maintaining direct two-way 

communications by a convenient, 

reliable means, such as a predetermined 


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working frequency over a handheld 

radio. 

Dynamic Positioning System 

Assurance Organization or DPSAO 

means an organization approved by the 

Coast Guard under 46 CFR 61.50–3 to 

conduct independent verification that a 

MODU or other vessel’s DP system is in 

compliance with applicable 

requirements contained in this 

subchapter. 

Vessels include, but are not limited 

to, Mobile Offshore Drilling Units 

(MODUs). Vessels other than MODUs 

that conduct certain activities or possess 

certain design characteristics means 

vessels that conduct such activities or 

possess such characteristics and are not 

MODUs. 

Well Specific Operating Criteria 

(WSOC) means criteria that set out the 

operational, environmental, and 

equipment performance limits 

considered necessary for safe DP system 

operations while operating on a well. 

The WSOC sets out various levels of 

operator action as these limits are 

approached or exceeded, and varies 

depending on the well or location. The 

WSOC defines when the DP system 

must be configured in its CAMO during 

drilling or production. If the CAMO is 

required for that specific activity, the 

WSOC will require the MODU to cease 

operations when an equipment failure 

makes operation in CAMO impossible. 

§ 140.310 DP system personnel 

requirements. 

(a) When using a dynamic positioning 

(DP) system to engage in Outer 

Continental Shelf (OCS) activities on the 

U.S. OCS, each mobile offshore drilling 

unit (MODU) or other vessel to which 

this subpart applies must have on board 

a sufficient number of Dynamic 

Positioning Operators (DPOs) and 

Dynamic Positioning Operators, 

Qualified (DPOQs) to meet the following 

operational requirements: 

(1) DPO and DPOQs must meet the 

rest hour requirements in 46 CFR 

15.1111. 

(2) DPOQs operating the DP system 

must be under the direct supervision of 

a DPO. 

(3) A DPO or DPOQ must be available 

at the DP operating station. 

(b) Determination of the number of 

DPOs and DPOQs must take into 

account the nature of the DP operations 

and the operational requirements of the 

DP system. 

(c) On a MODU or other vessel using 

a DP system to engage in OCS activities 

on the U.S. OCS, navigational watches 

must be maintained at all times as 

required in § 140.320 of this subpart. 

The DPO or DPOQ must be in direct 

communication with the officer in 

charge of the navigational watch during 

DP system operations. Nothing in this 

section is to be interpreted as 

relinquishing or lessening the 

responsibility of the master and 

watchstanding officer(s) to ensure the 

safe navigation and/or operation of the 

vessel. 

(d) When using a DP system to engage 

in OCS activities on the U.S. OCS, each 

MODU or other vessel must have a 

properly trained DPO operating the DP 

system or directly supervising a DPOQ 

operating the DP system. 

(e) A DPOQ on each MODU or other 

vessel using a DP system to engage in 

OCS activities on the U.S. OCS may 

operate the DP system on that specific 

MODU or other vessel only after 

meeting the training and practical 

experience requirements for that vessel 

and being endorsed in writing by the 

DPO and master of that MODU or other 

vessel. 

(f) While operating the DP system 

pursuant to paragraph (d) of this 

section, the mate or officer of the watch 

may also serve as the DPO provided the 

mate or officer holds the appropriate 

credential and the DP system control 

systems are collocated with the 

navigational equipment. 

§ 140.315 DP system training 

requirements. 

(a) The Dynamic Positioning Operator 

(DPO) must receive training and 

practical experience in the operation of 

the dynamic positioning (DP) system 

and its components. The content of 

training and experience must include all 

provisions of paragraph (b) of this 

section, and the following: 

(1) The DP system components, 

including the control station, power 

generation and management, propulsion 

units, position reference systems, 

heading reference systems, 

environmental reference systems, and 

external force reference systems, such as 

hawser tension gauges. 

(2) The range of routine DP 

operations, as well as the handling of 

DP faults, failures, incidents, and 

emergencies, to ensure that operations 

are continued or terminated safely. 

(3) The type and purpose of 

documentation associated with DP 

operations, such as operational 

manuals, Failure Modes and Effects 

Analysis (FMEAs), and capability plots. 

(b) To be qualified to operate a DP 

system, the Dynamic Positioning 

Operator, Qualified (DPOQ) must 

have— 

(1) Completed training that provides 

an introduction to the functions and use 

of a DP system; 

(2) Completed 30 days of DP system 

training on board a vessel equipped 

with a DP system, including training on 

the design, components, related and 

integrated shipboard systems, system 

redundancy alarms, and warnings for 

that specific vessel’s DP system; 

(3) Demonstrated thorough knowledge 

of the DP system operating manual for 

the specific vessel on which the DPOQ 

will serve, including procedures for 

shifting the DP system between all 

normal operational modes and 

emergency procedures. A DPOQ who 

will serve on a vessel engaging in 

Critical Outer Continental Shelf (OCS) 

Activities must also demonstrate 

thorough knowledge of the industrial 

mission, including the Critical Activity 

Mode of Operations, and either the 

Activity Specific Operating Criteria or 

Well Specific Operating Criteria as 

defined in 46 CFR 62.10–1. 

(4) Demonstrated a fundamental 

understanding of the specific DP 

system’s FMEA and its implications; 

and 

(5) Demonstrated familiarity with the 

vessel’s specific DP system, including 

participating in a walkthrough of the 

design and mechanical features with the 

DPO, to include at a minimum— 

(i) Power generation; 

(ii) Power distribution; 

(iii) Thruster units and associated 

equipment; 

(iv) Power management/logic; and 

(v) DP system control interfaces and 

related electronics and computer 

functions. 

(c) DPOs and DPOQs must carry the 

original copy of their DP system record 

of training or be able to provide such a 

copy to a requesting authority within 48 

hours of the request. 

(d) The Coast Guard will accept 

company letters, course completion 

certificates from a training institution, 

letters or course completion certificates 

from the DP system manufacturer, or 

certification from an industry-accepted 

organization as proof of DP system 

training. 

(e) The owner or operator of a U.S.- 

documented seagoing vessel using a DP 

system to maintain station must 

maintain a copy of each DPO and DPOQ 

training record in accordance with 46 

CFR 15.1107. 

(f) All onboard DP system training 

must be documented in each mariner’s 

record of training in accordance with 46 

CFR 15.1107. 

(g) The master, officers in charge of a 

navigational watch, and DPOs must be 

familiar with the characteristics of the 

vessel and the specific equipment fitted 

on it prior to operating the equipment 

as required in 46 CFR 15.405. This 


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familiarization must include reading the 

DP system equipment and operations 

manual, DP system incident reports, 

FMEAs, and any documented history of 

the DP system. The familiarization must 

be documented. 

§ 140.320 DP system manning 

requirements. 

(a) All Mobile Offshore Drilling Units 

(MODUs) and other vessels to which 

this subpart applies must— 

(1) Be under the command of an 

individual holding an appropriate 

certificate of competency as a master 

issued by the Flag State authority; and 

(2) Maintain navigational watches 

with an adequate number of mates or 

officers in charge of a navigational 

watch holding an appropriate certificate 

of competency issued by the Flag State 

authority. 

(b) Each person assigned duties as 

master, mate, or officer in charge of a 

navigational watch must meet the hours 

of rest requirements in Regulation VIII/ 

1 of the STCW Convention and Section 

A–VIII/1 of the STCW Code (both 

incorporated by reference, see § 140.7 of 

this part) . 

(c) All MODUs using a dynamic 

positioning (DP) system to engage in 

Outer Continental Shelf (OCS) activities 

on the U.S. OCS must hold a manning 

certificate specifying the minimum 

complement necessary to maintain the 

navigational watches. The manning 

complement must meet the 

requirements in paragraph (a) of this 

section and § 140.310 of this part. The 

manning complement may be 

determined after considering the 

specialized nature of each MODU, 

including the limitations and 

capabilities of the DP system. 

§ 140.325 Operations. 

(a) Owners or operators of Mobile 

Offshore Drilling Units (MODUs) and 

other vessels to which this subpart 

applies must maintain a Dynamic 

Positioning (DP) System Operations 

Manual that complies with paragraph 

4.4 of IMO MSC/Circ.645 (incorporated 

by reference, see § 140.7). 

(b) The owner, operator, or master of 

each MODU or other vessel to which 

this subpart applies must ensure that all 

DP System Operations Manuals, 

including manufacturers’ manuals, are 

available to the Dynamic Positioning 

Operator (DPO) at or near the DP system 

console when using a DP system to 

engage in OCS activities. 

(c) When conducting vessel-to-vessel 

transfer operations using a DP system— 

(1) Operational procedures for 

conducting oil or hazardous material 

transfers in DP mode must follow the 

transfer procedures in 33 CFR 155.750 

and must include emergency procedures 

for securing operations and executing 

emergency breakaway; 

(2) Vessel masters and, as appropriate, 

chief engineers must— 

(i) Determine which vessel will be 

designated to maintain a geographic 

position; 

(ii) Ensure that all watchstanders of 

all vessels other than MODUs 

understand their responsibility to 

maintain a designated relative position 

to or remain clear of the vessel 

maintaining the geographic position; 

(iii) Complete a Declaration of 

Inspection before beginning transfer 

operations; and 

(iv) Reconcile any differences 

between the emergency procedures in 

each vessel’s DP System Operations 

Manual; 

(3) Vessel personnel must establish 

voice communications between 

participants to determine— 

(i) The vessel designated as the 

controlling station; 

(ii) The controlling station DPO 

coordination responsibility; 

(iii) Primary and alternate 

communication channels; 

(iv) An emergency-only channel that 

can be monitored uninterrupted for the 

duration of the procedure; 

(v) The acquisition and assessment of 

regular weather forecast information for 

the area of operations; and 

(vi) The sharing with other active 

vessels of weather information, 

assessment of prevailing conditions, and 

use of onboard weather forecasting 

instruments; 

(4) When a MODU or other vessel to 

which this subpart applies uses a DP 

system to conduct vessel-to-vessel 

transfers with a vessel that is using a 

different DP system equipment class, 

the criteria for action in any emergency 

situation will be based on the least 

redundant DP system; 

(5) Any crew member on a MODU or 

other vessel conducting a vessel-tovessel transfer operation using a DP 

system for station keeping must execute 

a ‘‘stop operations’’ command if they 

identify a situation that warrants such 

action; 

(6) Each unit’s DPO must keep the 

bridge personnel of the other units, as 

defined in 33 CFR 140.10, involved in 

the vessel-to-vessel transfer fully 

advised of all alarm or emergency 

situations, including, but not limited to, 

DP system operations that could affect 

the operation in progress; and 

(7) During an emergency or the 

sounding of a general alarm, pumping 

operations must cease until the problem 

has been resolved. 

§ 140.330 Minimum DP system 

requirements. 

Vessels to which this subpart applies 

must, at a minimum, satisfy the 

provisions of 33 CFR 140.310, 140.315, 

140.320, 140.325 and 46 CFR 62.40–3. 

Vessels that must comply with the 

intermediate, standard, or enhanced DP 

system requirements in §§ 140.335, 

140.340, and 140.345 must also comply 

with the provisions of this section. 

§ 140.335 Intermediate DP system 

requirements. 

(a) Vessels other than MODUs of more 

than 500 GT ITC (500 GRT if GT ITC not 

assigned) that use a dynamic 

positioning (DP) system installed before 

[30 DAYS AFTER DATE OF 

PUBLICATION OF FINAL RULE] to 

engage in Critical Outer Continental 

Shelf (OCS) Activities on the U.S. OCS 

must comply with the provisions of this 

section no later than the applicable date 

in table 140.335 of this section. 

(b) Vessels that must comply with the 

standard or enhanced DP system 

requirements in §§ 140.340 and 140.345 

must also comply with the provisions of 

this section. 

TABLE 140.335—PHASE IN SCHEDULE

FOR VESSELS (EXCEPT MODUS) 

WITH EXISTING DP SYSTEMS

Tonnage of vessels 

other than MODUs 

Date requirements 

effective 

At least 1,900 GT ITC Date of Final Rule + 

3 years. 

At least 900 GT ITC ... Date of Final Rule + 

6 years. 

Greater than 500 GT 

ITC (500 GRT if GT 

ITC not assigned).

Date of Final Rule + 

9 years. 

(c) Vessels to which this section 

applies must meet the requirements of— 

(1) 46 CFR 61.50 (Survey); 

(2) 46 CFR 62.40–15 (FMEA); 

(3) 46 CFR 62.40–20 (FMEA Proving 

Test Document); and 

(4) 46 CFR 62.40–25 (CAMO). 

(d) The DP System Operations Manual 

for a vessel other than a MODU to 

which this section applies must also 

meet section 4.8 of the MTS DP 

Operations Guide (incorporated by 

reference, see § 140.7) for either project/ 

construction vessels or logistics vessels, 

as appropriate. The DP System 

Operations Manual for a vessel other 

than a MODU must contain Activity 

Specific Operational Criteria (ASOC) 

applicable to the operations performed 

by the vessel. 

(e) The DP System Operations Manual 

for a MODU to which this section 

applies must also meet section 4.7 of the 

MTS DP Operations Guide for MODUs 


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(incorporated by reference, see § 140.7). 

The DP System Operations Manual on a 

MODU must contain Well Specific 

Operational Criteria (WSOC) applicable 

to the operations performed by the 

MODU. 

(f) Vessels to which this section 

applies must define a Critical Activity 

Mode of Operation (CAMO) for use 

during Critical OCS Activities. The 

CAMO must be included in the DP 

System Operations Manual required by 

this section. 

(g) Vessels other than MODUs to 

which this section applies must operate 

in accordance with the ASOC applicable 

to its operation every time the DP 

system is used, regardless of whether or 

not the particular operation is a Critical 

OCS Activity. A MODU must use a 

WSOC when operating on a well. 

(h) Vessels to which this section 

applies must configure the DP system in 

its CAMO when engaging in Critical 

OCS Activities as defined in 33 CFR 

140.305. 

(i) In the event that a vessel to which 

this section applies experiences a 

reactive change of DP status from green 

to yellow or red as described in the 

applicable MTS DP Operations 

Guidance and defined by the vessel’s 

ASOC or WSOC, the owner or operator 

of the vessel must report this DP 

incident to the DPSAO that conducted 

the DP surveys required under 46 CFR 

61.50. For each such DP incident, the 

owner or operator of the vessel must 

conduct an investigation as described in 

section 4.11 of the MTS DP Operations 

Guide for MODUs or section 4.12 for 

either project/construction vessels or 

logistics vessels, as appropriate 

(incorporated by reference, see § 140.7) 

and send an investigation summary to 

the DPSAO that issued the DPVAD to 

the vessel. Each DP incident 

investigation summary must include— 

(1) The cause of the DP incident and 

whether it was addressed by the vessel’s 

FMEA, Well Specific Operating Criteria 

(WSOC) or Activity Specific Operating 

Criteria (ASOC), and Critical Activity 

Mode of Operation (CAMO), and lessons 

learned for incorporation into revised 

documents; and 

(2) If the cause of the DP incident was 

not addressed by the vessel’s FMEA, 

ASOC, WSOC, or CAMO, the changes 

that were made to those documents to 

address the cause(s) of the incident. 

This requirement is applicable whether 

or not the operation or activity at the 

time of the incident was a Critical OCS 

Activity. 

(j) Immediately after addressing safety 

concerns resulting from a DP incident, 

the owner or operator of the vessel must 

notify the cognizant OCMI verbally and 

by email of any DP incident reported 

under paragraph (i) of this section if the 

incident— 

(1) Involved a reactive change of DP 

status from green to red; and 

(2) Required an emergency disconnect 

from a well; or 

(3) Was a serious marine incident as 

defined by 46 CFR 4.03–2. 

(k) A vessel to which this section 

applies must be issued a Dynamic 

Positioning Verification Acceptance 

Document (DPVAD) by a DPSAO. The 

DPVAD describes the vessel’s DP system 

particulars, the certificate’s period of 

validity, the identification of the 

DPSAO, the requirements of this 

subpart that are being certified, the 

dates of the completed surveys required 

by paragraph (c) of this section, and the 

subsequent surveys required to maintain 

the certificate’s validity. 

(l) A DPVAD issued under paragraph 

(k) of this section is valid for 5 years. 

(m) Alternative guidance may be used 

in lieu of the MTS DP Operations Guide 

to meet the requirements of paragraphs 

(d), (e) and (i) of this section if 

permitted by the Commandant (CG– 

ENG) to the extent and under conditions 

that will ensure a degree of safety 

comparable to or greater than that 

provided by use of the MTS DP 

Operations Guide. 

§ 140.340 Standard DP system 

requirements. 

(a) Vessels other than MODUs of 6000 

GT ITC or less that use a DP system 

installed on or after [30 DAYS AFTER 

DATE OF PUBLICATION OF FINAL 

RULE] to engage in Critical OCS 

Activities must comply with the 

provisions of this section and 33 CFR 

140.335 and 140.330. 

(b) Vessels that must comply with the 

enhanced DP system requirements in 

§ 140.345 must also comply with the 

provisions of this section. 

(c) Vessels to which this section 

applies must meet— 

(1) 46 CFR 62.40–5 (Design); 

(2) 46 CFR 62.40–10 (Classification); 

and 

(3) 46 CFR 62.25–40 (Environmental 

Design). 

(d) Compliance with paragraphs (a) 

through (c) of this section must be 

verified by the DPSAO during the 

surveys required by 46 CFR 61.50 and 

documented on the DPVAD. 

§ 140.345 Enhanced DP system 

requirements. 

(a) The following vessels must comply 

with the provisions of this section: 

(1) Mobile Offshore Drilling Units 

(MODUs) that use a dynamic 

positioning (DP) system to engage in 

Critical Outer Continental Shelf (OCS) 

Activities on the U.S. OCS; and 

(2) Vessels other than MODUs of more 

than 6,000 GT ITC that use a DP system 

installed on or after [30 DAYS AFTER 

DATE OF PUBLICATION OF FINAL 

RULE] to conduct Critical OCS 

Activities on the U.S. OCS. 

(b) Vessels to which this section 

applies must meet the requirements of 

this section, 33 CFR 140.330, 140.335, 

140.340, and 46 CFR 62.20–2 (Required 

plans for DP systems). 

(c) Vessels to which this section 

applies must have the surveys required 

by 46 CFR 61.50 completed and have 

the plans required by 46 CFR 62.20–2 

approved by a DPSAO prior to receiving 

a Dynamic Positioning Verification 

Acceptance Document (DPVAD) under 

33 CFR 140.335(j). 

§ 140.350 Operational Control. 

If the Cognizant OCMI determines 

that a vessel is not in compliance with 

this part, the OCMI may require the 

owner or operator of a vessel to suspend 

use of DP to conduct an OCS activity 

until the OCMI determines that the 

vessel complies with this part. 

PART 143—DESIGN AND EQUIPMENT 

■ 4. The authority citation for part 143 

continues to read as follows: 

Authority: 43 U.S.C. 1333(d)(1), 1348(c), 

1356; 49 CFR 1.46; section 143.210 is also 

issued under 14 U.S.C. 664 and 31 U.S.C. 

9701. 

■ 5. Revise § 143.15 to read as follows: 

§ 143.15 Lights and warning devices. 

(a) OCS facilities, except when using 

DP systems defined by § 140.305, must 

meet the lights and warning devices 

requirements under part 67 of this 

chapter concerning aids to navigation 

on artificial islands and fixed structures. 

(b) * * * 

(c) Vessels, including MODUs and 

attending vessels, using a DP system 

defined by § 140.305 to maintain 

station, even when in contact of the 

seabed of the OCS, are considered 

underway and should display the lights 

and shapes for ‘‘vessel restricted in her 

ability to maneuver’’ as defined under 

Rule 3 of the International Regulations 

for Preventing Collisions at Sea 1972. 

PART 146— OPERATIONS 

■ 6. The authority citation for part 146 

continues to read as follows: 

Authority: 33 U.S.C. 1223, 1226; 43 U.S.C. 

1333, 1348, 1350, 1356; Sec. 109, Pub. L. 

109–347, 120 Stat. 1884; Department of 

Homeland Security Delegation No. 0170.1. 

■ 7. In § 146.405 add paragraph (b)(4) to 

read as follows: 


tkelley on DSK3SPTVN1PROD with PROPOSALS3
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§ 146.405 Safety and Security notice of 

arrival for vessels arriving at a place on the 

OCS. 

* * * * * 

(b) * * * 

(4) Vessels to which 140.335 applies 

that use a dynamic positioning (DP) 

system, as defined by 140.305, must 

provide the following information from 

the Dynamic Positioning Verification 

Acceptance Document (DPVAD): 

(i) DPVAD period of validity; and 

(ii) Identification of the dynamic 

positioning system assurance 

organization, as defined in 140.305, that 

conducted surveys; 

Title 46—Shipping 

PART 61—PERIODIC TESTS AND 

INSPECTIONS 

■ 8. The authority citation for part 61 is 

revised to read as follows: 

Authority: 43 U.S.C. 1333; 46 U.S.C. 2103, 

3306, 3307, 3703; sec. 617, Pub. L. 111–281, 

124 Stat. 2905; E.O. 12234, 45 FR 58801, 3 

CFR 1980 Comp., p. 277; Department of 

Homeland Security Delegation No. 0170.1. 

■ 9. Revise § 61.03–1 to read as follows: 

§ 61.03–1 Incorporation by reference. 

(a) Certain material is incorporated by 

reference into this part with the 

approval of the Director of the Federal 

Register under 5 U.S.C. 552(a) and 1 

CFR part 51. To enforce any edition 

other than that specified in this section, 

the Coast Guard must publish a notice 

of change in the Federal Register and 

the material must be available to the 

public. All approved material is 

available for inspection at the U.S. Coast 

Guard, Office of Design and Engineering 

Standards (CG–ENG), 2703 Martin 

Luther King Jr. Ave SE., Stop 7509, 

Washington, DC 20593–7509, and is 

available from the sources listed below. 

It is also available for inspection at the 

National Archives and Records 

Administration (NARA). For 

information on the availability of this 

material at NARA, call 202–741–6030 or 

go to http://www.archives.gov/federal_

register/code_of_federal_regulations/

ibr_locations.html. 

(b) ASTM International 100 Barr 

Harbor Drive, West Conshohocken, PA 

19428–2959, http://www.astm.org. 

(1) ASTM D 665–98, Standard Test 

Method for Rust-Preventing 

Characteristics of Inhibited Mineral Oil 

in the Presence of Water, IBR approved 

for § 61.20–17. 

(2) [Reserved] 

(c) International Maritime 

Organization (IMO), 4 Albert 

Embankment, London SE1 7SR, +44 

(0)20 7735 7611, http://www.imo.org. (1) 

IMO MSC/Circ.645—Guidelines for 

Vessels with Dynamic Positioning 

Systems, 1994 (‘‘IMO MSC/Circ.645’’), 

IBR approved for §§ 61.50–3, 61.50–5, 

61.50–10, and 61.50–15. 

(2) [Reserved] 

(d) Marine Technology Society, 1100 

H Street NW., Suite LL–100, 

Washington, DC 20005, 202–717–8705, 

http://www.mtsociety.org. 

(1) MTS DP Operations Guidance 

(‘‘MTS DP Operations Guide’’), Part 2, 

for MODUs (March 2012), Project 

Construction Vessels (July 2012), 

Logistics Vessels (July 2012), IBR 

approved for §§ 61.50–5(a) and 61.50– 

10. 

(2) [Reserved] 

■ 10. Add new subpart 61.50, consisting 

of §§ 61.50–1 through 61.50–20, to read 

as follows: 

Subpart 61.50—Dynamic Positioning 

System (DP System) Surveys and Dynamic 

Positioning System Assurance 

Organizations (DPSAO) for Vessels 

Operating on the Outer Continental Shelf. 

Sec. 

61.50–1 Applicability. 

61.50–2 Surveys of MODUs and vessels, 

other than MODUs. 

61.50–3 Acceptance of dynamic positioning 

system assurance organizations. 

61.50–4 Oversight of dynamic positioning 

system assurance organizations. 

61.50–5 Initial survey. 

61.50–10 Periodic survey. 

61.50–15 Annual survey. 

61.50–20 Appeals 

Subpart 61.50—Dynamic Positioning 

System (DP System) Surveys and 

Dynamic Positioning System 

Assurance Organizations (DPSAO) for 

Vessels Operating on the Outer 

Continental Shelf. 

§ 61.50–1 Applicability. 

(a) The following vessels must comply 

with the provisions of this subpart: 

(1) Vessels other than MODUs of more 

than 500 GT ITC (500 GRT if GT ITC not 

assigned) that use a dynamic 

positioning (DP) system installed before 

[30 DAYS AFTER DATE OF 

PUBLICATION OF FINAL RULE] to 

conduct Critical Outer Continental Shelf 

(OCS) Activities, as defined in 33 CFR 

140.305, on the U.S. OCS must comply 

with the provisions of this section no 

later than the applicable date in 33 CFR 

table 140.335; 

(2) Vessels other than MODUS that 

use a DP system installed on or after (30 

DAYS AFTER DATE OF PUBLICATION 

OF FINAL RULE) to engage in Critical 

OCS Activities, as defined in 33 CFR 

140.305, on the U.S. OCS; and 

(3) MODUs that use a DP system to 

conduct Critical OCS Activities, as 

defined in 33 CFR 140.305, on the U.S. 

OCS. 

(4) For purposes of this subpart, 

‘‘vessels’’ includes, but is not limited to, 

MODUs. Vessels other than MODUs that 

conduct certain activities or possess 

certain design characteristics means 

vessels that conduct such activities or 

possess such characteristics and are not 

MODUs. 

§ 61.50–2 Surveys of MODUs and vessels, 

other than MODUs. 

(a) The owner or operator of a vessel 

to which this subpart applies must 

ensure that the dynamic positioning 

system surveys required by §§ 61.50–5, 

61.50–10, and 61.50–15 of this subpart 

are completed by a DPSAO and provide 

the cognizant Officer in Charge, Marine 

Inspection an opportunity to attend 

upon request. The DPSAO that conducts 

the surveys required by this subpart 

must notify the cognizant Officer in 

Charge, Marine Inspection at least 30 

days in advance of the survey. 

(b) Alternative guidance may be used 

in lieu of the MTS DP Operations Guide 

to meet the survey requirements of 

§ 61.50–5(a) and § 61.50–10(a) of this 

subpart if permitted by the Coast Guard 

Office of Design and Engineering 

Standards (Commandant (CG–ENG)) to 

the extent and under conditions that 

will ensure a degree of safety 

comparable to or greater than that 

provided by use of the MTS DP 

Operations Guide. 

§ 61.50–3 Acceptance of dynamic 

positioning system assurance 

organizations. 

(a) Each DPSAO, as described in 

§ 61.50–2 of this subpart, must be 

accepted by the Coast Guard Outer 

Continental Shelf National Center of 

Expertise (OCS NCOE). To be accepted, 

such an organization must apply to the 

OCS NCOE in writing for acceptance. 

The application must contain 

information demonstrating that the 

organization or society— 

(1) Has functioned as a recognized 

source to the industry of guidance on 

recommended practice through 

participation in industry groups (e.g., 

International Marine Contractors 

Association, Marine Technology 

Society, National Offshore Safety 

Advisory Committee); 

(2) Has functioned as a DP assurance 

provider to vessel owner, operators, 

charterers, etc., for at least 5 years in the 

role of DP Assurance with a 

documented, auditable history of 

providing Failure Modes and Effects 

Analysis (FMEA) and survey services on 

a wide variety of Mobile Offshore 

Drilling Units (MODUs) and vessels 

with different industrial missions; 

(3) Has a history of advising vessel 

owners, operators, and charterers and 


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providing guidance on appropriate 

corrective actions to address 

nonconformities and observations raised 

during DP trials and otherwise, to 

include incidents, casualties, and cases 

of nonconformity with DP class rules; 

(4) Has adequate resources, including 

research, technical, and managerial 

staff, to ensure appropriate updates and 

maintenance of internal DP guidelines, 

trials procedures, and survey 

requirements; 

(5) Has adequate resources and 

processes in place to ensure regular and 

adequate communications to the Coast 

Guard concerning recurring DP-related 

issues for purposes of trend analysis, 

reporting, and continuing development 

of rules and guidelines; 

(6) Uses personnel with a minimum of 

5 years of experience for both FMEA 

and survey services; 

(7) Directly employs a number of 

surveyors adequate to meet Coast Guard 

survey requirements; 

(8) Has adequate criteria for hiring 

and qualifying surveyors and technical 

staff; 

(9) Has an adequate program for 

continued training and development of 

surveyors and technical staff. Training 

and development must be structured, 

measured, monitored, and auditable; 

(10) Maintains an internal quality 

system based on current industry 

quality standards (e.g., ANSI/ASQC 

Q9001, or equivalent); 

(11) Can determine whether MODUs 

and vessels, other than MODUs, comply 

with the DP requirements of the Coast 

Guard during appropriate surveys and 

DP trials; 

(12) Can monitor all activities related 

to surveys and plan reviews performed 

pursuant to 46 CFR parts 61 and 62 for 

consistency and required end-results; 

(13) Is not under the financial control 

of owners or builders of MODUs or 

vessels, other than MODUs, or of others 

engaged commercially in the 

manufacture, equipping, repair, or 

operation of MODUs or vessels, other 

than MODUs; and 

(14) Does not have any business 

interest in, or share of ownership of, any 

MODU or other vessel to which it 

provides DP assurance services. 

§ 61.50–4 Oversight of dynamic 

positioning system assurance 

organizations. 

(a) The OCS NCOE may periodically 

audit the records of DPSAOs with 

reasonable advance notice to determine 

whether such organizations continue to 

comply with the provisions of 

paragraph § 61.50–3(a) of this subpart. 

The OCS NCOE may revoke acceptance 

after determining that such an 

organization no longer complies with 

the provisions of paragraph § 61.50–3(a) 

of this subpart. Acceptance remains in 

effect until revoked by the OCS NCOE. 

(b) DPSAOs must submit an annual 

report to the OCS NCOE that contains 

each DP investigation summary reported 

to it under 33 CFR 140.335(i). The 

DPSAO must confirm in the report that 

each DP investigation summary 

complies with 33 CFR 140.335(i). 

(c) Where the OCS NCOE is not 

satisfied with the resolution of any DP 

incident contained in the report 

required by paragraph (b) of this section, 

the OCS NCOE: 

(i) will advise the cognizant OCMI 

who may exercise operational control 

under 33 CFR 140.350 and require the 

DPSAO and the owner or operator of a 

MODU or vessel other than MODU to 

satisfactorily resolve the cause of the DP 

incident; and, 

(ii) may initiate an audit of the 

DPSAO under paragraph (a) of this 

section. 

§ 61.50–5 Initial survey. 

(a) An initial survey, specified in 

paragraph 5.1.1.1 of IMO MSC/Circ.645 

(incorporated by reference, see § 61.03– 

1) and section 4.6 of the MTS DP 

Operations Guide for MODUs or section 

4.7 for either project/construction 

vessels or logistics vessels, as 

appropriate (incorporated by reference, 

see § 61.03–1), must be conducted on a 

Mobile Offshore Drilling Unit (MODU) 

or vessel other than a MODU to which 

this subpart applies. The initial survey 

must include a Failure Modes and 

Effects Analysis (FMEA) proving test 

using the dynamic positioning (DP) 

system FMEA proving test document 

described in § 62.40–20 of this 

subchapter. The initial survey must 

identify the Critical Activity Mode of 

Operation (CAMO) defined in § 62.10–1 

of this subchapter. 

(b) DP system software, programmable 

controls, and alarm system logic must 

not be altered after satisfactory 

completion of the initial survey without 

the approval of the DPSAO described in 

§ 61.50–2 of this subpart. The DPSAO 

must notify the cognizant Officer in 

Charge, Marine Inspection of any 

approved alternation of software after an 

initial survey. The notification must 

include any changes to the vessel’s 

FMEA or CAMO that resulted from the 

software change, if applicable. 

(c) The initial survey must be 

completed in accordance with §§ 61.50– 

2 of this subpart. 

§ 61.50–10 Periodic survey. 

(a) A periodic survey, specified in 

paragraph 5.1.1.2 of IMO MSC/Circ.645 

(incorporated by reference, see § 61.03– 

1) and section 4.6 of the MTS DP 

Operations Guide for MODUs or section 

4.7 for either project/construction 

vessels or logistics vessels, as 

appropriate (incorporated by reference, 

see § 61.03–1), must be conducted on a 

vessel to which this subpart applies at 

intervals not exceeding 5 years. This 

survey is intended to verify compliance 

with IMO MSC/Circ.645 and the 

applicable requirements of this 

subchapter. 

(b) The periodic survey must be 

completed in accordance with §§ 61.50– 

2. 

§ 61.50–15 Annual survey. 

(a) An annual survey, described in 

paragraph 5.1.1.3 of IMO MSC/Circ.645 

(incorporated by reference, see § 61.03– 

1), must be conducted on a vessel to 

which this subpart applies within the 3 

months before or after each anniversary 

date of the initial survey. The annual 

survey must ensure that the dynamic 

positioning system has been maintained 

in accordance with applicable parts of 

IMO MSC/Circ.645 and is in good 

working order. 

(b) The annual survey must be 

completed in accordance with §§ 61.50– 

2 this subpart. 

§ 61.50–20 Appeals 

(a) Any person directly affected by an 

action or decision of the Coast Guard 

Outer Continental Shelf Center of 

Excellence (OCS NCOE) taken under the 

regulations in this subchapter may 

request reconsideration of that action or 

decision. If still dissatisfied, that person 

may appeal the action or decision of the 

OCS NCOE within 30 days to the U.S. 

Coast Guard Deputy Commandant for 

Prevention (CG–5P). The Deputy 

Commandant for Prevention will issue a 

decision after reviewing the appeal 

submitted under this paragraph. Rulings 

of the Deputy Commandant for 

Prevention constitute final agency 

action. 

(b) An appeal to the Deputy 

Commandant for Prevention: 

(1) Must be made in writing, except in 

an emergency when a verbal appeal may 

be accepted; 

(2) Must describe the decision or 

action being appealed; 

(3) Must state the reasons why the 

action or decision should be set aside or 

modified; and 

(4) May contain any supporting 

documents and evidence that the 

appellant wishes to have considered. 

(c) Pending determination of any 

appeal, the action or decision appealed 

remains in effect, unless suspended by 

the Deputy Commandant for Prevention. 


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PART 62—VITAL SYSTEM 

AUTOMATION 

■ 11. The authority citation for part 62 

continues to read as follows: 

Authority: 46 U.S.C. 3306, 3703, 8105; sec. 

617, Pub. L. 111–281, 124 Stat. 2905; E.O. 

12234, 45 FR 58801, 3 CFR, 1980 Comp., p. 

277; Department of Homeland Security 

Delegation No. 0170.1. 

■ 12. In § 62.01–5 revise paragraph (a) to 

read as follows: 

§ 62.01–5 Applicability. 

(a) Vessels. Except as described in 

§ 62.40–1 of this part, this part applies 

to self-propelled vessels of 500 gross 

tons or more that are certificated under 

46 CFR subchapters D, I, or U and to 

self-propelled vessels of 100 gross tons 

or more that are certificated under 46 

CFR subchapter H. 

* * * * * 

■ 13. Revise § 62.05–1 to read as 

follows: 

§ 62.05–1 Incorporation by reference. 

(a) Certain material is incorporated by 

reference into this part with the 

approval of the Director of the Federal 

Register under 5 U.S.C. 552(a) and 1 

CFR part 51. To enforce any edition 

other than that specified in this section, 

the Coast Guard must publish notice of 

change in the Federal Register and the 

material must be available to the public. 

All approved material is available for 

inspection at the U.S. Coast Guard, 

Office of Design and Engineering 

Standards (CG–ENG), 2703 Martin 

Luther King Jr. Ave SE., Stop 7509, 

Washington, DC 20593–7509, and is 

available from the sources below. It is 

also available for inspection at the 

National Archives and Records 

Administration (NARA). For 

information on the availability of this 

material at NARA, call 202–741–6030 or 

go to http://www.archives.gov/federal_

register/code_of_federal_regulations/

ibr_locations.html. 

(b) American Bureau of Shipping 

(ABS), ABS Plaza, 16855 Northchase 

Drive, Houston, TX 77060, http://

www.eagle.org. 

(1) Rules for Building and Classing 

Steel Vessels, Part 4 Vessel Systems and 

Machinery (2003) (‘‘ABS Steel Vessel 

Rules’’), IBR approved for §§ 62.25–30, 

62.35–5, 62.35–35, 62.35–40, 62.35–50, 

and 62.50–30. 

(2) [Reserved] 

(c) International Electrotechnical 

Commission (IEC), 3, rue de Varembe, 

Geneva, Switzerland, +41 22 919 02 11, 

http://www.iec.ch. 

(1) IEC 60092–504 Electrical 

Installation in Ships—Part 504: Special 

Features—Control and Instrumentation 

(Third Edition, 2001–03)(‘‘IEC 60092– 

504’’), IBR approved for § 62.25–40(b). 

(2) [Reserved] 

(d) International Maritime 

Organization (IMO), 4 Albert 

Embankment, London SE1 7SR, +44 

(0)20 7735 7611, http://www.imo.org. 

(1) Resolution MSC/Circ.645— 

Guidelines for Vessels with Dynamic 

Positioning Systems, 1994 (‘‘IMO MSC/ 

Circ.645’’), IBR approved for §§ 62.40–3, 

62.40–5(b), and 62.40–15. 

(2) [Reserved] 

(e) Marine Technology Society (MTS), 

1100 H Street NW., Suite LL–100, 

Washington, DC 20005, 202–717–8705, 

http://www.mtsociety.org. 

(1) MTS DP Operations Guidance 

(‘‘MTS DP Operations Guide’’), Part 2, 

for MODUs (March 2012), Project 

Construction Vessels (July 2012), 

Logistics Vessels (July 2012), IBR 

approved for §§ 62.40–5(a), and 62.40– 

15. 

(2) [Reserved] 

■ 14. Amend § 62.10–1 by adding, in 

alphabetical order, the definitions of the 

terms ‘‘Activity Specific Operating 

Criteria (ASOC)’’; ‘‘Capability Plot’’; 

‘‘Consequence analyzer’’; ‘‘Critical 

Activity Mode of Operation (CAMO)’’; 

‘‘Dynamic positioning system (DP 

system)’’; ‘‘Redundancy’’; ‘‘Vessels’’; 

and ‘‘Well Specific Operating Criteria 

(WSOC)’’, to read as follows: 

§ 62.10–1 Definitions. 

(a) * * * 

Activity Specific Operating Criteria 

(ASOC) means criteria that set out the 

operational, environmental, and 

equipment performance limits 

considered necessary for safe dynamic 

positioning (DP) system operations 

while carrying out a specific activity. 

The ASOC sets out various levels of 

operator action as these limits are 

approached or exceeded and varies 

depending on the activity. The ASOC 

defines whether the DP system must be 

configured in its Critical Activity Mode 

of Operation (CAMO) during that 

specific activity. If the CAMO is 

required for that specific activity, the 

ASOC will require the vessel to cease 

operations when an equipment failure 

makes operation in CAMO impossible. 

* * * * * 

Capability Plot means a document 

that provides an indication of a vessel’s 

DP station-keeping ability, expressed in 

a common format. 

Consequence analyzer means a 

software function that continuously 

performs an analysis of the vessel’s 

ability to maintain its position and 

heading after a predefined, worst-case 

failure during operation. Possible 

consequences are based on the actual 

weather conditions, enabled thrusters, 

and power plant status. 

Critical Activity Mode of Operation 

(CAMO) means a tabulated presentation 

of how to configure the vessel’s DP 

system, including power generation and 

distribution, and propulsion and 

position reference systems, so that the 

DP system as a whole is fault-tolerant 

and fault-resistant. The CAMO is 

validated by a Failure Modes and Effects 

Analysis (FMEA) proving test at the 

initial survey described in § 61.50–5 of 

this subchapter. 

Dynamic positioning system (DP 

system) means a complete installation of 

components and systems that act 

together and is sufficiently reliable to 

provide vessel position-keeping 

capability. Any vessel using a DP 

system is considered a vessel underway, 

even if maintaining a fixed position. A 

DP system is comprised of the following 

sub-systems: 

(1) Power system, consisting of prime 

movers with necessary auxiliary 

systems and associated piping, 

generators, switchboards, and 

distribution system. 

(2) Thruster system, consisting of 

thrusters with drive units and 

associated auxiliary systems and piping, 

main propellers, and rudders (if all such 

thruster system parts are under the 

control of the DP system), thruster 

control electronics, manual thruster 

controls, and associated cabling and 

cable routing. 

(3) Control system, consisting of 

computer system, joystick system, 

sensor system, display system (operator 

panels), position reference system, and 

associated cabling and cable routing. 

* * * * * 

Redundancy means the ability of a 

component or system to maintain or 

restore its function when a single failure 

has occurred. For example, redundancy 

may be achieved by the installation of 

multiple components, systems, or 

alternate means that perform the same 

function. 

* * * * * 

Vessels include, but are not limited 

to, Mobile Offshore Drilling Units. 

Vessels other than MODUs that conduct 

certain activities or possess certain 

design characteristics means vessels that 

conduct such activities or possess such 

characteristics and are not MODUs. 

* * * * * 

Well Specific Operating Criteria 

(WSOC) means criteria that set out the 

operational, environmental, and 

equipment performance limits 

considered necessary for safe DP system 

operations while operating on a well. 

The WSOC sets out various levels of 


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operator action as these limits are 

approached or exceeded, and varies 

depending on the well or location. The 

WSOC defines when the DP system 

must be configured in its CAMO during 

drilling or production. If the CAMO is 

required for that specific activity, the 

WSOC will require the MODU to cease 

operations when an equipment failure 

makes operation in CAMO impossible. 

■ 15. Add new § 62.20–2 to read as 

follows: 

§ 62.20–2 Required plans for DP systems. 

(a) The following vessels must comply 

with the provisions of this section: 

(1) MODUs that use a dynamic 

positioning (DP) system to conduct 

Critical Outer Continental Shelf (OCS) 

Activities, as defined in 33 CFR 

140.305, on the U.S. OCS; and 

(2) Vessels of more than 6,000 GT ITC 

other than MODUs that use a DP system 

installed on or after [30 DAYS AFTER 

DATE OF PUBLICATION OF FINAL 

RULE] to conduct Critical OCS 

Activities, as defined in 33 CFR 

140.305, on the U.S. OCS. 

(b) The owner or operator of each 

vessel to which this section applies 

must submit the following DP system 

plans and information for approval to 

the dynamic positioning system 

assurance organization (DPSAO) that 

performs the surveys under subpart 

61.50 of this subchapter and is accepted 

under § 61.50–3 of this subchapter by 

the Coast Guard Outer Continental Shelf 

National Center of Expertise (OCS 

NCOE): 

(1) A DP system description, 

including a block diagram and 

functional relationships of various 

components. 

(2) Specifications of position 

reference and environmental monitoring 

sensors or systems. 

(3) The location of thrusters and 

control system components. 

(4) Details of the DP system 

monitoring and alarm system and 

interconnection with the main 

centralized monitoring and alarm 

system. 

(5) DP system Failure Modes and 

Effects Analysis (FMEA) and FMEA 

proving test documents as described in 

§ 62.40–15 and § 62.40–20 of this part, 

respectively. 

(6) The Critical Activity Mode of 

Operation determined from the initial 

survey required by § 61.50–5 of this 

subchapter. 

(7) Designer or manufacturer selfcertification of the DP system control 

equipment to the environmental design 

standards in § 62.25–40 of this part. See 

§ 62.20–5 of this part. 

(c) The DPSAO that performs the 

surveys under subpart 61.50 of this 

subchapter must submit a copy of the 

approved plans under paragraph (b) of 

this section and the results of the initial 

survey, including the FMEA proving 

test required by subpart 61.50 of this 

subchapter to the Commanding Officer, 

Marine Safety Center, U.S. Coast Guard 

Stop 7410, 4200 Wilson Blvd., Suite 

400, Arlington, VA 20598–7410. The 

Commanding Officer, Marine Safety 

Center may elect to review the plans to 

validate compliance with the 

requirements of this subpart and advise 

the DPSAO, the Coast Guard OSCNCOE 

and the cognizant Officer in Charge, 

Marine Inspection. 

■ 16. Add new § 62.25–40 to read as 

follows: 

§ 62.25–40 Environmental design 

standards. 

(a) The following Mobile Offshore 

Drilling Units (MODUs) and vessels, 

other than MODUs, must comply with 

the provisions of this section: 

(1) MODUs that use a dynamic 

positioning (DP) system to conduct 

Critical Outer Continental Shelf (OCS) 

Activities, as defined in 33 CFR 

140.305, on the U.S. OCS; and 

(2) Vessels other than MODUs that 

use a DP system installed on or after [30 

DAYS AFTER DATE OF PUBLICATION 

OF FINAL RULE] to conduct Critical 

OCS Activities, as defined in 33 CFR 

140.305, on the U.S. OCS. 

(b) Computer-based systems, 

microprocessors, storage devices, power 

supply units, signal conditioners, 

analog/digital converters, computer 

monitors (visual display units), 

keyboards, reference sensors, and 

related systems (excluding printers), 

and data recording or logging devices 

must be designed to the environmental 

standards in Clause 5 of IEC 60092–504 

(incorporated by reference, see § 62.05– 

1). 

■ 17. Add new subpart 62.40, consisting 

of §§ 62.40–1 through 62.40–25, to read 

as follows: 

Subpart 62.40—Dynamic Positioning 

Systems 

Sec. 

62.40–1 Applicability. 

62.40–3 Minimum dynamic positioning 

system requirements. 

62.40–5 Design for Critical OCS Activities. 

62.40–10 Classification for Critical OCS 

Activities. 

62.40–15 Failure Modes and Effects 

Analysis (FMEA). 

62.40–20 Failure Modes and Effects 

Analysis (FMEA) proving test document. 

62.40–25 Critical Activity Mode of 

Operation (CAMO). 

Subpart 62.40—Dynamic Positioning 

Systems 

§ 62.40–1 Applicability. 

This subpart applies to all vessels, 

including Mobile Offshore Drilling 

Units (MODUs), that use a dynamic 

positioning (DP) system to conduct 

Outer Continental Shelf (OCS) activities, 

as defined in 33 CFR 140.10, on the U.S. 

OCS. ‘‘Vessels,’’ for purposes of this 

subpart, include but are not limited to 

MODUs. 

§ 62.40–3 Minimum dynamic positioning 

system requirements. 

Vessels to which this subpart applies 

must meet the applicable requirements 

of this part and 46 CFR 62.35–5 and 46 

CFR 62.50–30 for remote propulsion 

control systems with periodically 

unattended machinery plants, as well as 

paragraph 3.4.1 of IMO MSC/Circ.645 

(incorporated by reference, see § 62.05– 

1), except subparagraph 3.4.1.4. 

§ 62.40–5 Design for Critical OCS 

Activities. 

(a) The following vessels must comply 

with the provisions of this section: 

(1) MODUs that use a dynamic 

positioning (DP) system to conduct 

Critical Outer Continental Shelf (OCS) 

Activities, as defined in 33 CFR 

140.305, on the U.S. OCS; and 

(2) Vessels other than MODUs that 

use a DP system installed on or after (30 

DAYS AFTER DATE OF PUBLICATION 

OF FINAL RULE) to conduct Critical 

OCS Activities, as defined in 33 CFR 

140.305, on the U.S. OCS. 

(b) Vessels to which this section 

applies must meet the provisions of 

IMO MSC/Circ.645 (incorporated by 

reference, see § 62.05–1) and the 

provisions of the applicable MTS DP 

Operations Guide (incorporated by 

reference, see § 62.05–1) relevant to 

equipment class 2 (DP–2) or higher for 

MODUs, project construction vessels, or 

logistics vessels, as appropriate. 

§ 62.40–10 Classification for Critical OCS 

Activities. 

(a) The following vessels must comply 

with the provisions of this section: 

(1) MODUs that use a dynamic 

positioning (DP) system to conduct 

Critical Outer Continental Shelf (OCS) 

Activities, as defined in 33 CFR 

140.305, on the U.S. OCS; and 

(2) Vessels other than MODUs that 

use a DP system installed on or after (30 

DAYS AFTER DATE OF PUBLICATION 

OF FINAL RULE) to conduct Critical 

OCS Activities, as defined in 33 CFR 

140.305, on the U.S. OCS. 

(b) Vessels to which this section 

applies must obtain an IMO MSC/

Circ.645 equipment class 2 (DP–2) or 


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70994 Federal Register / Vol. 79, No. 229 / Friday, November 28, 2014 / Proposed Rules 

higher notation from a classification 

society that meets the requirements of 

paragraph (c) of this section. 

(c) The classification society that 

issues an equipment class 2 (DP–2) or 

higher notation to vessels under this 

section applies must— 

(1) Comply with the provisions of 46 

CFR, part 8, subpart B; 

(2) Possess DP system rules aligned 

with IMO MSC/Circ.645 and the MTS 

DP Operations Guide (incorporated by 

reference, see § 62.05–1) applicable to 

the vessel being classed; and, 

(3) Submit evidence that it complies 

with paragraphs c(1) and c(2) of this 

section to the Coast Guard Outer 

Continental Shelf National Center of 

Expertise (OCS NCOE), which will 

authorize the classification society to 

issue notations as described in this 

section. 

§ 62.40–15 Failure Modes and Effects 

Analysis (FMEA). 

(a) The following vessels must comply 

with the provisions of this section: 

(1) Vessels other than MODUs of more 

than 500 GT ITC (500 GRT if GT ITC not 

assigned) that use a dynamic 

positioning (DP) system installed before 

(30 DAYS AFTER DATE OF 

PUBLICATION OF FINAL RULE) to 

conduct Critical Outer Continental Shelf 

(OCS) Activities, as defined in 33 CFR 

140.305, on the U.S. OCS; 

(2) Vessels other than MODUs that 

use a DP system installed on or after (30 

DAYS AFTER DATE OF PUBLICATION 

OF FINAL RULE) to conduct Critical 

OCS Activities; and 

(3) MODUs that use a DP system to 

conduct Critical OCS Activities, as 

defined in 33 CFR 140.305, on the U.S. 

OCS. 

(b) The owner or operator of each 

vessel to which this section applies 

must complete and maintain an FMEA 

with the details necessary to 

demonstrate compliance with the 

applicable provisions of IMO MSC/

Circ.645 and must demonstrate 

compliance with the MTS DP 

Operations Guide (both incorporated by 

reference, see § 62.05–1) for equipment 

class 2 (DP–2) or equipment class 3 

(DP–3) requirements and this subpart, as 

applicable. 

(c) Vessels described in paragraph 

(a)(1) of this section must comply with 

the provisions of this section no later 

than the applicable date in 33 CFR table 

140.335. 

(d) Alternative guidance may be used 

in lieu of the MTS DP Operations Guide 

to meet the requirements of this section 

if permitted by the Office of Design and 

Engineering Standards (Commandant 

(CG–ENG)) to the extent and under 

conditions that will ensure a degree of 

safety comparable to or greater than that 

provided by use of the MTS DP 

Operations Guide. 

§ 62.40–20 Failure Modes and Effects 

Analysis (FMEA) proving test document. 

(a) The owner or operator of each 

vessel to which § 62.40–15 of this 

subpart applies must complete and 

maintain a dynamic positioning system 

FMEA proving test document that— 

(1) Provides the necessary test 

instructions, based on the FMEA 

required by this subpart, to demonstrate 

design and operation in accordance 

with the equipment class of the DP 

system and this subpart; and 

(2) Is approved by the Marine Safety 

Center under § 62.20–2 of this part and 

retained on board. 

§ 62.40–25 Critical Activity Mode of 

Operation (CAMO). 

(a) The owner or operator of each 

vessel to which § 62.40–15 of this 

subpart applies must complete and 

maintain a CAMO as defined in § 62.10– 

1 of this part. 

Dated: November 13, 2014. 

J.G. Lantz, 

Director of Commercial Regulations and 

Standards, U.S. Coast Guard. 

[FR Doc. 2014–27594 Filed 11–26–14; 8:45 am] 

BILLING CODE 9110–04–P 


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