Oil and Gas Regulatory Regime

John Hayes Excerpts

Tuesday 18th December 2012 Written Statements

[The Minister of State, Department of Energy and Climate Change (Mr John Hayes)]

I am today publishing the response to the Maitland review’s recommendations on the UK’s offshore oil and gas regulatory regime.

On 20 April 2010, the Deepwater Horizon drilling rig, working on the Macondo well in the gulf of Mexico, exploded leading to the tragic deaths of 11 personnel and the loss of 4.9 million barrels of oil to the sea. While the offshore UK oil and gas regime is regarded as one of the strongest in the world, the Government wanted to ensure that the UK considered the findings from the official Macondo reports and their relevance to the oil and gas industry in the UK.

The Government asked Geoffrey Maitland, Professor of Energy Engineering at Imperial College London, to chair an independent review panel to carry out this task. Mick Temple (retired BAA Development Director and currently a Member of the Faculty of Sustainability Leadership at the University of Cambridge) and Professor John Shepherd (Research Fellow in Earth Systems at the University of Southampton) also provided their considerable expertise to the panel.

The independently chaired panel published its report in December 2011. The report made recommendations around 10 key themes: well planning and control, environmental protection, emergency response, learning from incidents and best practice, implementation assurance, competency and training of the workforce, workforce engagement, liability and insurance, regulator issues and technology development.

A steering group of representatives from the Department of Energy and Climate Change (DECC), the Health and Safety Executive(HSE), the Maritime and Coastguard Agency (MCA) and the industry representative body Oil and Gas UK have carefully considered the Maitland review recommendations. I am pleased today to publish the response to the panel’s recommendations. I have deposited copies of the response document in the House for Members to read.

The majority of the recommendations have been positively received and implemented in full; some of the work is ongoing, but where this applies work plans with appropriate target dates for completion are in place and detailed in the response. There were other recommendations, where after full and careful consideration, it was concluded that an alternative approach was more appropriate to achieve a similar outcome. Where this is the case, a full explanation of the work that was undertaken to reach the alternative conclusion is contained in the response.

A new senior oversight group, comprising DECC, HSE and MCA, will supervise the successful implementation of the Maitland review recommendations that are still being delivered as well as ensuring that the offshore regime remains fit for purpose in the longer term.

I believe that the Government and industry responses to the independent panel’s recommendations, alongside other ongoing work, will ensure that the UK continental shelf (UKCS) offshore oil and gas industry builds upon its existing high standards by: protecting the environment; engaging and safeguarding its workforce; responding to emergencies and introducing new mechanisms on financial responsibility so that petroleum licensees on the UKCS must demonstrate that they have the financial capability to response to an incident before consent is given to drill exploration and appraisal wells.