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US announces proposed arctic exploration and production regulations

23rd February 2015

The US Bureau of Safety and Environmental Enforcement (BSEE) and the Bureau of Ocean Energy Management (BOEM) released on Friday proposed regulations to ensure that future exploratory drilling activities on the US Arctic Outer Continental Shelf (OCS) are done safely and responsibly, subject to strong and proven operational standards

The US Bureau of Safety and Environmental Enforcement (BSEE) and the Bureau of Ocean Energy Management (BOEM) released on Friday proposed regulations to ensure that future exploratory drilling activities on the US Arctic Outer Continental Shelf (OCS) are done safely and responsibly, subject to strong and proven operational standards
The proposed Arctic-specific regulations focus solely on offshore exploration drilling operations within the Beaufort Sea and Chukchi Sea Planning Areas

The proposed Arctic-specific regulations focus solely on offshore exploration drilling operations within the Beaufort Sea and Chukchi Sea Planning Areas.

Using a combination of performance-based and prescriptive standards, the proposed regulations codify and further develop current Arctic-specific operational standards that seek to ensure that operators take the necessary steps to plan through all phases of offshore exploration in the Arctic, including mobilisation, drilling, maritime transport and emergency response, and conduct safe drilling operations while in theatre.

“The Arctic has substantial oil and gas potential, and the US has a longstanding interest in the orderly development of these resources, which includes establishing high standards for the protection of this critical ecosystem, the surrounding communities, and the subsistence needs and cultural traditions of Alaska Natives,” said secretary of the interior Sally Jewell.

“These proposed regulations issued today extend the administration’s thoughtful approach to balanced oil and gas exploration in the Arctic, and are designed to ensure that offshore exploratory activities will continue to be subject to the highest safety standards.”

The proposed regulations codify requirements that all Arctic offshore operators and their contractors are appropriately prepared for Arctic conditions and that operators have developed an integrated operations plan that details all phases of the exploration program for purposes of advance planning and risk assessment. With an emphasis on safe and responsible exploration, the proposed rule also would require operators to submit region-specific oil spill response plans, have prompt access to source control and containment equipment, and have available a separate relief rig to timely drill a relief well in the event of a loss of well control. The proposed rule continues to allow for technological innovation, as long as the operator can demonstrate that the level of its safety and environmental performance satisfies the standards set forth in the proposed rule.

“The proposed rule codifies existing Arctic-specific standards and establishes the rules of the road for all companies interested in safe and responsible Arctic exploration,” said assistant secretary for land minerals management Janice Schneider. “In turn, these rules would facilitate exploration planning efforts and provide regulatory certainty, while ensuring that the U.S. maintains its leadership position in overseeing safe exploration operations that protect this unique and sensitive environment.”

The proposed regulations have been developed with significant up-front public input from the State of Alaska, North Slope communities, industry and non-governmental organizations. The proposed regulations will be open for additional public comment to ensure transparency and solicit feedback from all stakeholders. Interior will continue rigorous stakeholder engagement as well as formal tribal consultation in the region. A draft Environmental Assessment, required by the National Environmental Policy Act, is also available for public comment.

The Alaska OCS is an integral part of the US’s “all-of-the-above” domestic energy strategy. The department in January released the Draft Proposed Program (DPP) for the Outer Continental Shelf (OCS) Oil and Gas Leasing Program for 2017-2022, which is an early step in a multi-year process to develop a plan to guide the country’s offshore oil and gas leasing. Offshore Alaska, the draft proposed plan continues to take a careful approach by utilising the targeted leasing strategy set forth in the current program, and recognizing the substantial environmental, social and ecological concerns in the Arctic. The DPP proposes three potential lease sales offshore Alaska, including making available for leasing areas that contain 90 per cent of undiscovered technically recoverable oil and gas resources in the Chukchi and Beaufort Seas.

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