The Deepwater Horizon disaster in April 2010 triggered an international torrent of government consultations and industry initiatives. At UK level, one of the outcomes of this was the Maitland review, an independent panel appointed by the UK Government to consider the findings from a range of official reports on Deepwater Horizon and to draw conclusions about their relevance to the oil and gas industry in the UK (the Maitland report).
The Maitland report, which contained a long list of post-Macondo conclusions and recommendations for the UK oil and gas industry in the field of environmental and safety regulation, was published in December 2011. On 18 December 2012 the Government published its response.
On the whole, the Government's response is consistent with its previous official statements and publications in that it strongly supports and endorses the existing UK offshore regulatory regime, and does not indicate any radical changes to the prevailing legal system. The thrust of the response is to highlight progress that has already been made by DECC and the oil and gas industry in responding to the Deepwater Horizon disaster.
Among the key statements of regulatory significance are the following:
- An independent annual review of selected Environmental Statements and Oil Pollution Emergency Plans will take place.
- Increased requirement for operators to carry out offshore oil and gas emergency response exercises involving the Secretary of State's Representative (SOSREP) from every 5 years to every three years.
- There are new industry-approved guidelines on the competency of wells personnel, and the pan-industry forum is working to develop guidelines on how human factors can impact on well integrity.
- Separate guidance has been published on how petroleum licensees on the UKCS can demonstrate financial responsibility for drilling exploration and appraisal wells, which is to take effect from 1 January 2013.
- DECC and OGUK have agreed that the processes for financial responsibility will be considered at "the highest management levels in each company".
- The environmental regulator (DECC) and the safety regulator (HSE) have developed strategies to recruit and retain specialist inspectors and managers; and have agreed a new and enhanced Memorandum of Understanding.
One issue which is not covered in any detail in the Government's response is the awkward question of how the UK's response to Deepwater Horizon will (or will not) fit with the EU's proposed legislation in the field of offshore environmental and safety regulation. In October 2011, the European Commission published a proposal for a new Regulation on offshore safety in the oil and gas industry, and in October 2012 this proposal was updated and amended, most importantly to propose the legislation in the form of a Directive rather than a Regulation.
The Government's response states that its "negotiating stance" on this proposed EU legislation is that "care should be taken to ensure that any future changes at an EU level neither dilute the fundamental strengths of the UK system or undermine the authority of the relevant regulatory bodies within it nor … frustrate or delay the potential improvements highlighted elsewhere in this report".
It should be noted that the extent to which this is within the Government's control is limited, and an important issue to monitor next year will be how the EU-led proposals for legal reform impact on the UK regulatory regime and the initiatives currently being pursued by Government and industry.