US Interior proposes blowout preventer rule

OREANDA-NEWS. April 14, 2015. The US Interior Department today proposed stricter rules governing blowout preventers and well control for oil and gas operations offshore, as regulators try to avoid a replay of the deadly Deepwater Horizon accident nearly five years ago.

Just one week before the anniversary of BP's Macondo well blowout in the US Gulf of Mexico on 20 April 2010, Interior and its Bureau of Safety and Environmental Enforcement (BSEE) today proposed a long-anticipated rule designed to bolster the effectiveness of the last line of defense to avoid a possible explosion and oil spill.

The failure of the Macondo well's blowout preventer has long been viewed as a key contributor to a disaster that killed 11 crew members and sparked the worst oil spill in US offshore history.

"This is complicated stuff," interior secretary Sally Jewell said. "There is an awful lot of assessment that was done post-Deepwater Horizon to understand exactly what went wrong and what we need to do about it."

The latest proposal would require that operators use blowout preventers armed with double shear rams, to better ensure that such a device – the last line of defense against a possible explosion and spill – is more likely to shear a drill pipe and shut off a well.

A 2011 forensic analysis conducted by Det Norske Veritas (DNV) of the Macondo well's blowout preventer concluded that that device's shear ram was unable to sever a 5.5-inch drill pipe that had been knocked "slightly off center". A National Academy of Engineering and the National Research Council called for a redesign of blowout preventers, saying the design of the device used at on Macondo was "flawed."

In requiring double shear rams, the rule would largely codify industry trade group the American Petroleum Institute's (API) Standard 53. But unlike the industry baseline standard, the proposal would not allow operators to opt to forego use of a double shear ram on moored rigs.

The proposed rule also would require that shear rams include a technology that ensures the drill pipe is centered to avoid the complications of an off-center drill pipe. The proposed rule also would require more rigorous third-party certification of a blowout preventer's shearing capabilities.

The proposal would mandate real-time monitoring capability for deepwater or high temperature and high pressure wells. And it would require changes in well design, well control, casing, cementing and subsea containment.

Regulators are asking stakeholders whether they should, over the next 10 years, require that operators develop the technology to shear anything in a well-bore. BSEE director Brian Salerno noted that that capability does not exist today. "We decided to put that out there as a question and to specifically seek comment on whether that is a realist requirement and whether it is achievable."

Interior estimates complying with the rule would cost the industry \\$165mn this year (using 2012 dollars) and \\$883mn over 10 years. The outer continental shelf accounted for 16pc of US oil production and 5pc of gas production in 2014.

Regulators will accept comments on the proposed rule for 60 days after it is published in the Federal Register.

This latest proposal would build on BSEE's 2012 drilling safety rule and its 2013 workplace safety rule, in which operators were required to maintain a safety and environmental management system. Regulators are finalizing a rule on production safety and are working on a other regulations affecting subsea systems and crane operations.

The offshore industry reacted cautiously to the proposal today. API upstream group director Erik Milito said the trade group is studying the rule is hoping the regulations "will complement industry own efforts to enhance safety." The National Ocean Industries Association president Randall Luthi said his members are "concerned that reasonable and necessary time is allowed for proposed design and manufacturing modifications and that third party certifications are a useful tool for verifying safety measures and not merely an increase in a bureaucratic process."

In anticipation of the proposal, the offshore industry in recent days has been touting the sector's progress on offshore safety.

The Center for Offshore Safety issued its first annual performance review of the offshore industry on 8 April, finding that oil and gas operating in US waters suffered no fatalities and no spills greater than 238bl in 2013. Equipment failure was a factor in more than two thirds of the accidents reported, that study found.