1、American Petroleum Institute Achieving Common Sense Environmental Regulation: Oil and Gas Exploration be based on good science and the best possible data, and rely on the industrys expertise; be based on realistic analysis of risks so that the added environmental benefit from the program is clear; r
2、ely on cost-benefit analysis to produce a rational prioritization of problems to be addressed; be flexible and focus on performance, not methods, so that compliance can be achieved in the most cost-effective manner; not require unnecessary paperwork, needless monitoring or excessive permitting delay
3、s; recognize the uniqueness of the exploration and production sector of the oil and gas industry and the remoteness of most facilities; and build upon the success of existing state programs and industry practices. The American public should not have to bear the expense of regulations that dont make
4、sense. There have been success stories which show that federal regulators can emulate the successes at the state level and work with the industry to develop common sense solutions to environmental concerns. By relying on state and industry expertise, a better outcome has been achieved for all, truly
5、 a “win-win“ situation. One such success story is the MMS and API s Safety and Environmental Management Program (SEMP). Gulf of Mexico offshore exploration and development activities in federal waters are regulated by the Minerals Management Service (MMS) of the Department of the Interior. Eighteen
6、percent ofJJ.S. oil production and 28 percent of natural gas production comes from offshore wells. MMS and the U.S. Coast Guard agreed to work with the industry in developing SEMP on a voluntary basis. This effort resulted in the publication of API RP 75-Recommended Practice for Development of a Saf
7、ety and Environmental Management Program for Outer Continental Shelf Operations and Facilities. The standard is being used for facilities offshore California and in Alaska, as well. The SEMP program goes one-very important-step farther than traditional regulatory programs. SEMP is not a regulatory r
8、egime, it is a management system designed to produce a safety mentality, not a compliance mentality. The basis for this shift was a study indicating that four-fifths of offshore accidents were the result of errors-mostly human-while operations were in compliance with existing regulations. MMS and th
9、e industry agreed to see if performance could be improved by developing a management system that each company could implement to analyze hazards and performance and then make changes in how they approach operations, training, personnel use, work practices, and the quality and integrity of critical e
10、quipment. By the end of 1995, 106 companies operating in the OCS-accounting for 99.8% of production volume-participated in the program. In these companies, the safety and environmental programs that companies have had for years have been integrated and are constantly being reviewed, audited and upgr
11、aded to ensure that all the right bases are covered. But unfortunately, many of the federal regulatory efforts now underway do not pass a “common sense“ test. In many cases, the proposals under discussion have been formulated without reliance on the years of expertise in the states and without regar
12、d to the unique nature of the exploration and production industry-rather, they are merely applications of manufacturing processing methods to the E water-related issues like the management of produced water and oil spill prevention; and land-based management of production wastes. Air issues. Additio
13、nal exploration and production industry environmental requirements will result from the Environment Protection Agencys implementation of the Clean Air Act Amendments of 1990. Some of the processes used by the industry in producing oil and natural gas, such as glycol dehydrators-equipment that separa
14、tes water from natural gas to make it safe for transportation by pipeline-emit into the air toxics like benzene. Many of the regulations being considered are heavy on paperwork and monitoring requirements, and arent really directed at improving environmental performance. The challenge is to develop
15、regulations that focus on legitimate air emissions issues based on risk. Regulations that restrict operating flexibility, create paperwork and require needless monitoring in remote areas add to the cost of producing oil and natural gas without providing corresponding environmental benefits. Water is
16、sues. The exploration and production industry focuses on protecting our offshore and onshore water resources in two main areas: preventing oil spills and properly managing produced water and other discharges. Well control and efforts to prevent oil spills have improved dramatically as the industry h
17、as matured. In nearly 40 years of drilling oil wells on the federal outer continental shelf, for example, there have been just five big spills-the last more than 20 years ago. Just last year the offshore oil industry in the Gulf of Mexico weathered a severe hurricane season with all workers safely e
18、vacuated in advance of the storms and without environmental damage. The year before facilities weathered the ferocity of Hurricane Andrew-a 1 00-year storm-with very little damage. Certainly, there is no fail-safe guarantee against spills. And, as the 1989 tanker transportation spill in Alaskas Prin
19、ce William Sound demonstrated, the short-term consequences of such a serious accident can be enormous. However, the U.S. industrys efforts have redoubled since the Alaskan spill, and additional operational safeguards and response plans-some at the initiative of industry and others directed by regula
20、tions-have been put in place to provide increased protection to the environment. The other major water issue is produced water-usually with significant salt and mineral content that occurs naturally in geological formations and is brought to the surface with the oil and gas. The industry must handle
21、 very large volumes of produced water in order to recover oil and gas. API estimates approximately six to eight barrels of water are produced for each barrel of oil. Currently, in the United States about 92 percent of this produced water is injected deep underground in some 177,000 injection wells.
22、About two-thirds of the reinjected water is used to drive additional oil toward producing wells, enhancing oil recovery. Injection is regulated at the federal level under the Safe Drinking Water Act and by numerous federally-approved state underground injection control 3 programs-all reinjection is
23、regulated in some way. In some cases, low-salinity produced waters are beneficially used in arid areas for irrigation and for watering livestock. Offshore produced waters are usually discharged under Clean Water Act regulations and National Pollutant Discharge Elimination System (NPDES) permits with
24、 appropriate monitoring and reporting. Land issues. The exploration and production industry has evolved tremendously from its beginning over a century ago in the way it protects the land surrounding industry operations. Issues include protecting surface water and groundwater from contamination and t
25、he improved management and disposal of drilling muds-water- or oil-based mixtures of naturally occurring clays and additives circulated through the wellbore to remove cuttings, cool the drill bit and control well pressure-and associated wastes, such as workover fluids and oily debris from tank botto
26、ms. Proper management of production wastes depends to a large extent on the geography surrounding the drilling site. What makes sense in the Louisiana wetlands does not necessarily provide sound, efficient waste management policy in the arid areas of West Texas, the high plains of Wyoming, or the Ap
27、palachian fields of West Virginia. The type of soil, underground rock formations, and the level of the water table are all factors that govern the way these materials are managed-often on a site-by-site basis. The industry has worked closely with state regulators since the first state regulations in
28、 the 1920s to protect groundwater, and the expertise and dedication exist to manage any site-specific risks. Recently, EPA conducted an extensive investigation into state and industry practices which concluded in 1988. EPA closed their effort with the issuance of a “regulatory determination“ support
29、ing continued jurisdiction over E the construction, operation, monitoring and closure of pits used to store produced water and other nonhazardous oilfield wastes; and the reuse of processed nonhazardous oilfield wastes. The various types of pits used in these activities were defined and specific reg
30、ulations were established to assure protection of fresh water and the environment during their use. Standards were set for monitoring, pit closure, waste analysis, burial or trenching, solidification, and disposal by subsurface injection, among other items. Louisiana was far from alone in its effort
31、s. The Interstate Oil and Gas Compact Commission (IOGCC), an organization of the governors and state officials from the oil and gas producing states, with funding assistance from EPA and input from both environmental and industry groups, developed a model state oil and gas E the Federal Insecticide,
32、 Fungicide and Rodenticide Act; the Marine Protection, Research and Sanctuaries Act; the Endangered Species Act; the Safe Drinking Water Act; the Toxic Substances Control Act; the Resource Conservation and Recovery Act; and the Comprehensive Environmental Response, Compensation and Liability Act (be
33、tter known as Superfund). In 1986 the Emergency Planning and Community Right-to-Know Act became part of Superfund, and in 1990 the Clean Air Act Amendments and the Oil Pollution Act were passed. As a result, by 1991 the cost of federal environmental regulations on the nations consumers and businesse
34、s reached approximately $115 billion. About half of this environmental regulatory cost was to control water pollution. About a third was for air pollution-auto emissions, smokestack controls, and other controls-and the rest was for solid waste. 6 Achieving Further Environmental Progress: Common Sens
35、e Regulation of the Exploration and Production Industry With such extensive state and federal environmental regulation of the oil and natural gas exploration and production industry already in place, experience bears out the obvious: significant environmental gains have already been made. E be based
36、 on good science and the best possible data, and rely on the industrys expertise; be based on realistic analysis of risks so that the added environmental benefit from the program is clear; rely on cost-benefit analysis to produce a rational prioritization of problems to be addressed; be flexible and
37、 focus on performance goals, not methods, so that compliance can be achieved in the most cost-effective manner; not require unnecessary paperwork, needless monitoring or excessive permitting delays; recognize the uniqueness of the exploration and production sector of the oil and gas industry and the
38、 remoteness of most facilities; and build upon the success of existing state programs and industry practices. 7 Do Federal Regulations Currently Under Discussion Pass The Common Sense Test? Unfortunately, many of the federal regulatory efforts now underway do not pass a simple “common sense“ test. I
39、n many cases, the proposals under discussion have been formulated without reliance on the years of expertise in the states and without regard to the unique nature of the exploration and production industry-rather, they are merely applications of manufacturing processing methods to the E estimate the
40、 total number ofE estimate national emission of HAPs from the industry; and specify controls and monitoring requirements for E Identification of the chemical categories that may be stored onsite longer than twelve months, with certified maximum volumes; A notice that material safety data sheets are
41、available upon request; and, Emergency contact information, updated as necessary. 17 This level of reporting would provide usable information and complement many existing, voluntary emergency planning efforts which companies already undertake for facilities that pose a potential risk. A modified rep
42、orting program, combined with industry efforts already underway, would provide communities with real knowledge and the ability to respond in the unlikely event of an exploration and production accident. Removing an unnecessary paperwork regime-originally designed for refineries and large chemical pl
43、ants-would give company officials more time for these meaningful activities. This industry proposal passes the common sense test because: it eliminates useless paperwork. it recognizes the nature of E&P facilities. it improves industry flexibility and encourages the adoption of new, better approache
44、s. it reduces industry costs without reducing environmental benefits. Oil Spill Reporting The Clean Water Act prohibits the discharge of“harmful quantities“ of oil into navigable waters. And in 1978 Congress modified the harmful quantity criteria of Section 311 by changing the wording from quantitie
45、s of oil that “will be harmful“ to quantities that “may be harmful.“ EPA regulations have defined the term “harmful quantities“ to apply to all discharges which “violate applicable water quality standards or cause a film or sheen on or upon the surface of the water “ Since virtually all discharges o
46、f oil will cause a sheen, under current regulations virtually all discharges are considered to be “a harmful quantity“ and therefore subject to the reporting and enforcement actions of the Clean Water Act. In 1985 EPA considered a petition to replace the sheen test with the measurable quantity of on
47、e barrel, but the Agency rejected it “in view of the successful and effective implementation of the existing oil sheen test over the past 14 years and the Agencys continued confidence in that procedure, and because the Agency at the moment has insufficient information on which to establish an altern
48、ative test that would meet the statutory based criteria of environmental protection and assure reliability and ease and consistency in implementation and enforcement.“ The legislative and regulatory history of oil spill reporting points to a lack of scientific rationale in determining the harmful qu
49、antity criteria. Other laws have been far less arbitrary. For example, the statute implementing the Superfund program requires the EPA to establish “reportable quantities“ of hazardous substances. Although petroleum and natural gas were specifically excluded from the definition of hazardous substances, for other hazardous substances EPA establishes a reportable quantity based on the effects on human health and the environment. This is a far more sensible approach than requiring reporting of any amount which “causes a sheen.“ According to Coas
