Independent Irish regulator in new role
The Commission for Energy Regulation ("CER") now regulates the safety of offshore and onshore oil and gas activities under the Petroleum Safety Framework. The relevant legislation empowering the CER came into operation on 18 December 2013, completing the transfer of the safety role from the licensing authority, the Petroleum Affairs Division of the Department of Communications, Energy and Natural Resources.
In line with international practice, the Petroleum Safety Framework is based on:
- a permitting regime for designated petroleum activities - such activities cannot commence without the approval of an associated safety case by the CER
- a god-setting and risk-based approach - petroleum undertakings are required to reduce all safety risks to a level that is as low as is reasonably Practicable (ALARP)
On 16 April 2014, the CER issued a safety permit under the new regime for well work.
The interaction between the Irish Petroleum Safety Framework 2013 and developments in European regulation
On 10 June 2013 a European Directive on the safety of offshore oil and gas operations was introduced, following the Deep Water Horizon disaster off the Gulf of Mexico in 2010.
The EU Offshore Safety Directive applies to all activities associated with an offshore installation or connected infrastructure. Ireland has until 19 July 2015 to implement the EU Directive.
The aim of the EU Directive is to introduce consistent best practices in relation to major hazard control, to ensure that the person responsible is clearly identifiable and to improve response mechanisms in emergencies. The EU Directive imposes requirements on offshore oil and gas activities which includes:
- there must be a full assessment of an applicant's technical and financial capabilities at the time of the granting (or transfer) of a licence to carry out offshore oil and gas operations
- the licensee must be made financially liable for the prevention and remediation of environmental damage as defined under the Environmental Liability Directive, and the reach of that Environmental Liability regime must include the marine waters of Member States, rather than the current 12 mile zone
- operators must not be relieved of their duties by the fact that actions contributing to major accidents were carried out by contractors
- EU operators and owners must include their offshore oil and gas operations outside of the EU in their corporate major accident prevention policy documents, and companies registered in the EU with these operations (including through subsidiaries) must report on major accidents occurring outside the EU
Though much of the new Irish Petroleum Safety Framework - which also deals with onshore activities - is a precursor to the EU Directive, modifications to the CER's safety permitting role will likely be required when the EU Directive is implemented in Ireland.
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