Chapter 4 - Environment

4.1 The Government is determined that environmental considerations remain at the forefront of the industry’s activities.

4.2 This chapter sets out in detail the United Kingdom’s offshore environmental regulations and the current initiatives being undertaken to protect the environment.

4.3 The present offshore environmental regime has evolved over the past thirty or so years in response to the impacts on the environment posed by the oil and gas exploration and production industry and the changes in society’s perception of these. The regime comprises strands of primary and secondary legislation, conditions in consents granted under the petroleum licensing regime and international conventions. It is supplemented by a number of specific schemes entered into voluntarily by the industry.

4.4 The DTI (the Department of Trade and Industry) does not undertake sole responsibility for offshore environmental regulation as many of its actions follow detailed consideration by a number of other Government Departments and Agencies including the Scottish Office, the Ministry of Agriculture Fisheries and Food (MAFF) and the Joint Nature Conservation Committee (JNCC).

4.5 The Government considers that it is now appropriate to review the current regime and, where needed, improve it as part of the Better Regulation drive to ensure regulation is coherent and efficient and to ensure that it is able to reflect recent developments and improved methods for ensuring high standards of environmental performance and protection. The goals of the offshore environmental regime are expected to continue to evolve in response to changes in technology and the needs of society both in the UK and Europe. The regime needs to be able to adapt efficiently to these future demands.

4.6 The Government issued a consultation paper on the future of the offshore environmental regime on 19 March 1999. Views were sought by 26 May 1999.

4.7 Primary responsibility for the implementation of this Directive (92/43/EEC) lies with the DETR. Regulations implementing the Directive in Great Britain came into force on 30th November 1994.

4.8 In accordance with Article 4(2) of the Directive, member states are obliged to take certain protection and conservation measures in respect of sites designated under it as candidate Special Areas of Conservation (SACs) or which are Special Protection Areas (SPAs) under Directive 79/409/EEC (the ‘Birds’ Directive). This requirement is reflected in the 1994 Regulations.

4.9 The DTI complies with the requirements of the 1994 Regulations as the competent authority on offshore licensing, initially by consulting the JNCC (the Government’s statutory adviser on nature conservation matters) before acreage is offered for licensing. The JNCC advises on whether exploration or production activities under a licence would be likely to have significant effects on SPAs or candidate SACs. It may advise that certain blocks are not offered for licensing or that conditions should be attached to others to protect particular sensitivities. The JNCC is then also consulted about subsequent consents for particular activities under licences.

4.10 The Offshore Petroleum Production and Pipe-lines (Assessment of Environmental Effects) Regulations 1998 came into force on 30 April 1998. These Regulations implement Council Directive 85/337/EEC which either requires an environmental impact assessment or makes it discretionary, for a variety of projects including certain offshore activities. As of 15 March 1999, 30 environmental statements covering 9 exploration wells in the Atlantic Frontier and 22 projects (wells and developments) in the North Sea, Irish Sea and English Channel have been received. There have also been a large number of requests for determination that environmental impact assessments are not necessary; the DTI has rejected some of these requests on the grounds that, in some cases, the environmental impacts may be different to those suggested by operators.

4.11 The 1998 Regulations were revoked by The Offshore Petroleum Production and Pipe-lines (Assessment of Environmental Effects) Regulations 1999 which were required to implement Council Directive 97/11/EC (amending Directive 85/337/EEC). The main changes are the introduction of:

4.12 There have also been some other minor changes introduced as a result of administering the 1998 Regulations.

4.13 The Merchant Shipping (Oil Pollution Preparedness, Response and Co-operation Convention) Regulations 1998 came into force on 15 May 1998 and cover contingency planning for offshore installations and pipelines. These imposed a legal obligation on offshore operators to submit an oil pollution emergency plan 2 months prior to new offshore activities commencing and support existing licence obligations. Under the Regulations, all existing (i.e. fixed or floating) offshore installations are required to have a revised plan in place by 15 August 1999, unless significant modifications have taken place before that date, in which case a plan would be required at the time to reflect this. To date, 73 plans have been received.

4.14 The model clauses incorporated into production licences state that Licensees are required to prevent the escape of petroleum into the sea and to notify the Secretary of State for the DTI of any such escape. Licensees are also required to show that they have funds available to discharge liability for damage caused by pollution.

4.15 The Prevention of Oil Pollution Act 1971 states that no oil shall be discharged into the sea, although it does provide for the Secretary of State to grant exemptions where necessary. In 1998, the DTI referred 2 cases to the Procurator Fiscal in Aberdeen for consideration of possible proceedings for breaches under the Act. Further decisions are currently awaited on 4 cases; the Procurator Fiscal decided not to proceed with one case submitted in 1998. The agreement of the Director of Public Prosecution was given so that a further case could proceed under the English legal system.

4.16 Chart 4.1 shows the comparison of oil spilled during the period 1989 to 1998 while Table 4.1 shows the reported figures. It is encouraging to note that 1998 figure for accidental oil spills (137 tonnes) is significantly lower than that in 1997 (866 tonnes). It is clearly evident, though, that the trend for reporting even the smallest of spills continues with 362 reports for spills of less than 1 tonne (this represents 92% of reports).

	1989	1990	1991	1992	1993	1994	1995	1996	1997	1998
Total Amount Spilled (tonnes) Of which:	517	899	192	225 (3)	224	174	84 (4)	127	866 (8)	137(7)
Oil from oil-based mud spills	326 (1)	466 (2)	116	49	145	74	29	28	38	35
Other oil spills	191	423	76	176	79	100	55	99	828	102
Number of installations reporting spills	44	56	39	43	43	50	52	77	96	101
Total Number of reports	291	345	234	194	183	147	145	300 (5)	349 (5)	392(5)
Total Stabilised Crude Oil produced from offshore oilfields (million tonnes)	86.7	86.3	83.1	89.1	90.2	114.4	116.7	116.7(8)	115.1(8)	119.1

4.17 As noted, the Government has published a consultation paper seeking views on improvements that could be made to the framework of its offshore environmental regime. This consultation also describes a number of specific areas where change is to be introduced. The first is the introduction of Integrated Pollution Prevention and Control for large combustion plant operating on offshore installations. This control arises from the implementation of EC Directive 96/61 on Integrated Pollution Prevention and Tonnes Control. The consultation covers the manner in which the Directive is to be implemented and provides draft regulations for comment.

4.18 The consultation also seeks views on the recommendations of Lord Donaldson’s Review of Salvage and Intervention and their Command and Control (Command Report 4193 March 1999) as they relate to offshore installations. While Lord Donaldson has emphasised the excellent record of the offshore industry in limiting the number and size of spills and the efficiency of its clean-up techniques, he has recommended that the Government takes new powers to enable it to intervene in an emergency involving pollution or threat of pollution from offshore installations. Lord Donaldson has further recommended that these powers, and the preparation for their use, are based on his recommendations for shipping casualties.

4.19 Since 1986 the UK has carried out surveillance flights over offshore installations in accordance with international obligations under the Bonn Agreement. These flights are unannounced and cover all offshore installations (drilling rigs and production facilities) on the UKCS (United Kingdom Continental Shelf).

4.20 In 1998, 300 hours were spent on 54 ‘dedicated’ oil rig patrols i.e. funded solely by the DTI; those on behalf of the Marine Pollution Control Unit (part of the Maritime and Coastguard Agency) are not included. The total amount of oil observed from unreported spills was just over 1 tonne. Three thousand, six hundred and forty four surveys of installations were undertaken. The Scottish Fisheries Protection Agency also undertakes its own routine overflights of the UKCS. The DTI works with these Agencies to ensure that any oil spill emanating from an offshore installation is reported, so the overall unannounced surveillance is significantly greater than the 300 hours currently funded.

4.21 The DTI continues to use the computer link to the aerial surveillance aircraft which transmits photographic images of pollution incidents. This has enabled the DTI to investigate oil spill incidents as they happen.

4.22 There were 57 inspections of offshore oil and gas installations between April 1998 and March 1999. DTI inspectors generally found that the environmental performance of offshore installations was satisfactory. However concerns were raised mainly relating to keeping documentation up to date, recording samples taken in an appropriate manner and better storage of chemicals.

4.23 It is impossible to make unannounced inspections of offshore installations. For safety reasons and in accordance with normal aviation practice, flight plans must be filed and the permission of the Offshore Installation Manager must be sought to land on a platform. However, some inspections were made at short notice.

4.24 In the UK, targets for oil discharges are regulated by conditions attached to exemptions issued under Section 23 of the Prevention of Oil Pollution Act 1971 (POPA) for produced water and some other operational discharges. These targets are agreed by the Oslo and Paris Convention, an international body charged with the prevention of pollution in the North Sea, which has indicated maximum target concentrations of oil from these sources which should not normally be exceeded.

4.25 When the discharge of oil-contaminated produced water from offshore installations is permitted by an exemption granted under POPA, the oil content should not exceed 40 parts per million. It has proved extremely difficult for a few installations, particularly those on mature fields, to meet this target. In 1998, of the 64 installations discharging oil in produced water, 6 exceeded this target when averaged over the whole year. However, in terms of the UKCS as a whole, the average content of oil in produced water for the year was only 22 parts per million, the lowest value yet recorded. It is encouraging to note that, even though the total amount of water discharged was at its highest recorded level, the total oil discharged with water has fallen to its lowest level for 4 years. This is shown on Chart 4.2.

4.26 This is a significant achievement for the offshore oil industry, particularly since the amount of water produced with oil increases as fields mature and fields at a late stage of production produce more water than oil. The current reduction shows that the considerable effort being made both by Government and industry in ensuring continuing improvement is now meeting with success. However, there is variance in the characteristics of produced water between installations; in the type of equipment used to treat it; the individual reservoir characteristics and the stage of production. For this reason there is no single solution to the problem and there will need to be a continued effort to continuously improve performance. Table 4.2 shows the amount of oil discharged with produced water which reflects the downward trend in recent years.

	1989	1990	1991	1992	1993	1994	1995	1996	1997	1998
Total Oil Discharged (tonnes)	3423	4393	5490	4850	4232	4418	5855	5706	5767(1)	5692
Total Water Discharged (million tonnes)	106	159	153	135	148	147	192	210	234	253
Number of Installations permitted to discharge oil	36	39	39	43	46	52	55	60	64(1)	64
Average Oil in Water Content (mg/kg)	32	27	35	36	28	30	30	27	25	22

To download this table click the appropriate format: Excel 4 or CSV file.

4.27 Since 1 January 1997, the UK has not discharged mineral oil contaminated cuttings into the sea. This is in accordance with international obligations, which specify that the amount of oil discharged must not exceed 10 grammes per kilogramme of cuttings. Where mineral oils are needed to ensure the technical success of the drilling operations cuttings are either taken to shore or injected into the well. In 1998, 7 wells had cuttings re-injected and 11 wells had cuttings shipped to shore for disposal.

4.28 Following the introduction of controls on the discharge of mineral oil-based cuttings, there was an increase in the use of ‘synthetic’ or ‘pseudo’ oil-based muds. However, concerns were raised as to the environmental acceptability of some of these products. Following studies of several of the commonly used synthetic fluids, which showed that their biodegredation properties were very similar to those of the mineral oils they had replaced, the DTI in conjunction with other Government Departments, acted with operators to reduce the discharge of those unacceptable synthetic drilling fluids to zero by 31 December 2000.

4.29 In order to achieve this, all operators were asked to draw up a company specific phase-out strategy demonstrating how each company intends to reduce its discharges by approximately 20% each year using a 1996 baseline. Chart 4.3 shows the proposed and actual discharges against the 1996 baseline. Operators are required to resubmit strategies each year to provide actual discharge figures as well as ensuring reduction targets are updated for forthcoming years. As can be seen, the objective of zero discharge by end-2000 is set to be achieved and companies are making greater reductions than targeted.

4.30 The DTI continues to monitor the use and discharge of chemicals offshore, through the Offshore Chemical Notification Scheme (OCNS). Operators are requested to submit chemicals for testing and categorisation reporting on a quarterly basis their use and discharge amounts. Although the UK’s current control over the discharge of chemicals offshore is voluntary, it is respected by many other countries who insist on UK categorisation before they will Tonnes allow use of a product in their own waters. In the UK the system has resulted in a clear positive effect on the types of chemicals being discharged offshore. The UK is working towards the introduction of a Harmonised Mandatory Control Scheme (HMCS) within the framework of the Oslo and Paris Convention which should be in place before the end of 1999. The List of Notified Chemicals details those chemicals currently awarded classification by the Centre for the Environment, Fisheries and Aquaculture Science (CEFAS - an Agency of MAFF). The 1999 revisions have been issued in paper form and should also soon be available electronically. The consultation paper issued on 19 March 1999 also seeks views on the form that mandatory control should take.

4.31 The Oslo and Paris (OSPAR) Convention was opened for signature in Paris on 22 September 1992. The Convention entered into force on 25 March 1998. It replaces the previous Oslo and Paris Commissions.

4.32 The United Kingdom is party to the Convention and therefore has a duty to report information on offshore discharges and emissions each year, two years in arrears. The information is presented at the Workgroup on Sea-Based Activities (SEBA) meetings.

4.33 The UK delegation presented information on offshore discharges and emissions, as well as the conclusions of the workshop on drilling fluids which was held in Aberdeen in 1997. The UK continues to take the lead on the issue of drilling fluids, which involves dialogue with other Contracting Parties. The UK also put forward an information paper, agreed with industry, that on a trial and voluntary basis a company specific target of 30 parts per million oil in produced water would be sought on the UKCS.

4.34 The UK delegation presented several papers including one relating to a draft Decision on the use of synthetic drilling fluids and a draft strategy with regard to the offshore oil and gas industry. No formal decisions were reached by the Workgroup on these papers and the UK undertook to further develop these in conjunction with other Contracting Parties.

4.35 The DTI continues to participate in industry funded programmes such as the Atlantic Frontier Environmental Forum and the Atlantic Frontier Environmental Network, both of which are designed to collect and disseminate environmental information for use in planning future offshore projects. The Department plans to conduct its own programme of data gathering in the course of 1999.

4.36 In addition, the DTI has continued to fund offshore environmental research and development programme which aids the understanding of offshore pollution and can assist in reaching decisions on environmental controls, licensing and decommissioning. Funds from Government ‘seed’ industry involvement, and assistance is given to small joint venture projects within industry. Projects sponsored in 1998 included continued funding of one looking at improving environmental information with respect to future offshore oil and gas activities and another which is seeking to further manage produced water discharges from offshore installations.

4.37 The United Kingdom is determined to play a constructive role in continuing international efforts to deal with the threat of climate change.

4.38 The UK has an international, legally-binding target for the reduction of its greenhouse gases emissions, following the agreement of a Protocol to the United Nations Framework Convention on Climate Change (UNFCCC), at Kyoto in December 1997, and the subsequent EU burden sharing agreement, agreed by Member States in June 1998. The UK’s target is to reduce its emissions of a basket of six greenhouse gases - carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulphur hexafluoride - by 12.5% from 1990 levels, during the period 2008-2012. The EU also agreed, in June 1998, priorities for action on common and coordinated policies and measures, to be pursued at EU and national level.

4.39 The Government conducted a consultation between October 1998 and February 1999 on possible policies and measures for achieving the UK’s target; and also for moving towards the domestic policy goal of a 20% reduction in CO2 emissions by 2010. It is now considering the responses to the consultation and will be developing a national climate change programme, for publication, and further consultation, later in 1999.

4.40 The Marshall Report was presented to Government in November 1998. The Report concluded that economic instruments might help improve the efficiency of energy use by business and contribute towards meeting climate change targets, but stressed it was vital to avoid damage to business competitiveness. It suggested that there might be a role for a tax on the business use of energy, combined with other actions, including the development of an international emissions trading system.

4.41 The Chancellor announced in his Budget Statement of 9 March 1999 that the Government intends to introduce in April 2001, a climate change levy on the business use of energy. The revenue from the levy will be recycled to business with the aim of making the levy fiscally neutral on business as a whole.

4.42 A consultation document on the design and administrative aspects of the climate change levy has been published by HM Customs and Excise. The consultation period ends on 28 May 1999.

Ms Judith Hope,
HM Customs and Excise,
3rd Floor,
West Raili Quay,
3 Stanley Street,
SALFORD, M60 9LA

	scoping - operators must be able to ask the competent authority (i.e. the DTI) for a formal opinion on the scope of information to be provided in an environmental statement;
	transboundary effects - there is expanded provision for consultation with other Member States on projects that are likely to have such effects; and
	publication of decisions - in cases where an environmental statement is required decisions must be published as to whether or not consent is given with the main reasons and considerations on which the decision is based. If consent is granted, mitigation measures (if any) must also be published. In addition, there is a requirement to publish decisions where an environmental statement is not required. Information relating to these decisions can be found on the DTI’s website at http://www.dti.gov.uk

4 Environment