On Friday, we told you OSHA was looking to revise its Process Safety Management (PSM) rules. As a part of that effort, the agency is asking whether PSM should apply to landside drilling, servicing and production of oil and gas wells. The notice was published in the Federal Register today. You can read what we said about the proposal in our last posting.
As they say in the movies: This is not a drill! Industry will have a limited time to comment on the rule and, while it will take a while for the proposal to work through the regulatory process, this is how the government may impose a safety management requirement similar to SEMS on landside operations.
A couple of significant events this past week.
First, we met with a group of oil and gas companies to walk them through our SEMSReady classes. SEMSReady is a partnership effort by Lifeline Strategies and OQSG to teach companies how to evaluate personnel on their skills and knowledge under SEMS. More and more operators are requiring their contractors to perform annual evaluations. The audits that were completed under SEMS showed verification of skills and knowledge was a major area for improvement and it is pretty clear operators are searching for a way to get their arms around this. We got a lot of really good feedback and they said it looks like SEMSReady will be an effective way to address the issue. We look forward to starting the classes for contractors. You can see more about SEMSReady here.
On Thursday we had a good session of the SEMS for contractors workshop in Lafayette. Full class. A lot of good questions and a lot of knowledge in the room. It is really impressive to see what companies are putting in place to meet the oil and gas company safety requirements offshore! The next one is scheduled for Houston in February, but contact us if you want to hold one at your office.
OSHA is preparing to release a rulemaking that seeks comments on its Process Safety Management rules. This is not one that industry can afford to ignore. The announcement is here and you can click here to read the full rulemaking document. The PSM standard is now more than 20 years old and was a pretty revolutionary concept for its time. It could probably use a review right about now.
However, OSHA is directly tying this review to four pretty horrific accidents, including the ammonium nitrate explosion this year in West, Texas, killed at least 15 people. As a rule of thumb, when a federal agency ties a rulemaking process to a tragedy, the result will be more and not less regulation. It appears that OSHA is looking at a very expansive laundry list of changes. The document says OSHA wants to open up PSM in 17 different categories.
The oil and gas upstream industry has special reason to pay attention to this rulemaking. Ever since SEMS came to the offshore world, industry has wondered if it would come on-shore. OSHA says with this rulemaking that it wants comments on whether PSM should apply to drilling and production. So there it is – a proposal to apply a SEMS-like system to E&P. There are other provisions that could also affect upstream operations and these will take a careful reading.
The proposal still needs to be published in the Federal Register, but once it is, the public will have 90 days to comment.
Are you a Contractor who needs help meeting SEMS requirements for worker competency evaluations?
Are you an Operator trying to ensure that your and your contractors’ personnel know how to work safely?
SEMSReady is a one day class that teaches you how to develop a skills and knowledge program and perform objective, auditable evaluations. Classes start this month. Here is the schedule:
December 10, 2013
9am, Houston, TX
December 11, 2013
9am, Lafayette, LA
January 8, 2014
9am, Lafayette, LA
January 14, 2014
9am, Houston, TX
To find out more, go to www.semsready.com. To look up classes or register, click here.
One side note from BSEE’s recent announcement on the SEMS audit deadline – We now have a clearer idea of how many offshore operators there actually are in U.S. federal waters. When the Safety and Environmental Management System (SEMS) rule first came out in 2010, the government said there were 130 operators of oil and gas facilities on the Outer Continental Shelf. However, in the complex world of oil and gas partnerships and idle iron, that was just a guesstimate.
Then on November 20th, BSEE announced that it was citing 12 offshore operators for failing to submit a completed SEMS audit. Buried in that announcement was a statement that “Eighty-four operators were subject to the Nov. 15, audit deadline,” meaning that, at least in the government’s eyes, 84 operators have at least one offshore facility that holds a BSEE lease of right-of-way. Of course, since many of the 12 operators cited are trying to finish decommissioning projects to leave the gulf, the number may be closer to 72. A 45% drop from 130 to 72 is pretty significant.
Why is this important? It shows that the number of small independents continues to drop (and perhaps that the requirements of SEMS may be one reason).
If you are a contractor, you can expect a lot of activity on the SEMS front in 2014:
- Operators will be making changes in their plans to address deficiencies in their audits;
- SEMS II changes are heading our way; and
- You can anticipate more pressure to prove personnel have the skills and knowledge to work safely offshore.
Our half-day SEMS workshop for contractors focuses on all of these issues. The next workshop will be held Friday, December 6th, in Lafayette, LA. We expect a good turnout, but seats are still available. To register or read more about it, click here.
Over the past month, this blog has looked at the SEMS requirement for operators to evaluate the skills and knowledge of contractor personnel. It is one of the bigger challenges in the offshore safety regulations because operators usually don’t know what it takes to be competent at every offshore job and most contractors don’t know how to prove competency, even when their workers are very safe and capable.
Then a couple of days ago I had a conversation that just crystalized the issue. An operator told me, “I ask a contractor to prove a worker has the skills and knowledge to work under SEMS and I get a stack of certificates and class rosters, but none of it tells me what I need to know. I want one piece of paper that says, ‘this guy knows how to do his job.’”
We think we have a solution. Lifeline Strategies and OQSG, a leader in evaluating the competency of pipeline workers, have teamed up to create SEMSReady™, a skills and knowledge verification system that:
- Teaches contractors how to create and manage a skills and knowledge plan (SKV plan) for workers;
- Teaches qualified subject matter experts how to perform evaluations that are accurate and objective; and
- Provides follow-on services for companies that need additional help developing their SKV plans and managing the information in a database.
The SEMSReady™ approach gives operators a tool to assess the way a contractor meets the skills and knowledge requirements of SEMS and then to verify that the workers have been evaluated on those skills. It gives contractors a structured way to develop an internal competency plan that can be documented and audited to meet operator requirements. The process also allows contractors to prove to auditors that their evaluators are qualified to perform those verifications. Given the number of places that SEMS requires operators to verify contractors on the job performance, we think this sort of approach may be the only way to meet the regulations.
You can learn more about the SEMSReady™ approach here. The first classes are scheduled for:
- December 10, 2013: Houston, TX
- December 11, 2013: Lafayette, LA
- January 8, 2014: Lafayette, LA
- January 14, 2014: Houston, TX
You can register for a class here.
The deadline for the first round of SEMS audits was Friday, a date which was celebrated by…nobody. So what does BSEE, the agency that required the audits in the first place, do with the results?
Just one guy’s opinion, but I wish BSEE would to the following:
1. Tell us how many oil and gas operators there are in offshore U.S. waters, based on the ones that turned in audits. Sounds like a simple piece of information but I don’t think anyone really knows. The SEMS rule estimated there were 160, but, given how many offshore facilities are shut-in, that was a guess.
2. Related to that, operators had to give BSEE a company contact when SEMS when into effect. Compare that to the number of audits turned in and tell us how many operators have exited the Gulf of Mexico since the rule went into effect. We know it has happened; let’s quantify it.
3. Scrub the names of the companies from the audit reports and let us know the general results. SEMS is about continuous improvement. Let’s start with the lessons learned from the audits. Rent a very large room. Invite operators and contractors alike and do a “hot-wash” of what has worked and what hasn’t.
4. Issue a Notice to Lessees that clarifies BSEE’s expectations on audits and what the agency’s role will be in future audits. One of the biggest complaints you hear about the audits is over the inconsistencies among audit providers. It is also time BSEE explained whether its job is to audit SEMS plans or to audit auditors.
That’s what is on my wish list. I have made my own study of the types of discrepancies the different auditors found and those lessons learned are a large part of my SEMS workshops and consulting with contractors. But it would be good if BSEE would share its information with industry.
From time to time, I would like to use this blog look at the different elements of the Safety and Environmental Management System (SEMS) rule and to focus on how they are being put into practice. The first section, named General Provisions, is more commonly referred to as the Management Section. It is where the company commits the people, time and other resources to put the plan into place, but it serves a more important function – When management cares, things get done and if management doesn’t care, nobody cares.
Looking at the oil and gas companies, which have to develop the SEMS plans, management involvement is what tells company employees and contractors that they need to follow the plan and not take shortcuts. This was driven home the other day in a conversation with Greg Gordillo of Bureau Veritas, one of the approved third-party SEMS auditing bodies. He said that there was a direct relationship between management’s involvement in pre- and post-audit meetings and the number of areas for improvement found by the audit team. Reading between the lines, management’s commitment to making the plan work and to safety in general shouldn’t start the day it receives the final audit report. It needs to be ongoing and visible.
How does that impact contractors? I recently had the chance to sit in with Chris Kuiper, President at Environmental Health & Safety, as he audited an offshore contractor for a major oil company. I was surprised at how many of his questions focused on upper management buy-in. As we walked through the different pieces of the company’s safety program, time and time again, Chris wanted to know how involved management (in fact the owner) had been in making changes or reviewing policies. At one point, he asked if the owner attended safety meeting and how actively he participated. As it happened, the owner of this company had been the safety manager early in his career and was very hands-on.
It was very clear that, as operators come to understand how much management commitment SEMS requires, they are looking for the same commitment from the owners and upper management of contractors before they put them to work offshore. If some contractors are not already seeing this when their customers come to audit, they will as this sea change takes hold.
And that makes sense. Many believe that SEMS won’t be fully effective until there is a shift in the safety culture offshore. They are right. Safety culture begins at the top.
We held a very successful workshop last week in Houston to help contractors understand SEMS. The next one is scheduled for Friday, December 6th in Lafayette, LA. You can learn more and register here.
This workshop lasts four hours and we cover:
- Each of the 13 SEMS elements from a contractor’s point of view
- The early lessons learned from the first round of SEMS audits
- What you need to know to prepare for the new requirements in SEMS II.
What makes these workshops unique is that they are focused on the contractor’s perspective. Now that the first round of audits are behind them, operators will be taking a hard look at some specific areas of SEMS. Knowing those areas and what the operators are looking for will help keep you in compliance. BSEE’s new push to INC contractors just adds to the importance of staying on top of SEMS.
These workshops are a very simple way to make sure your operations and sales staff understand the new requirements.