Bureau Of Safety
and Environmental
Enforcement
1
SEMS RULE - SUBPART S
IMPLEMENTATION AND
ENFORCEMENT
GCAT Meeting
Roberts, LA
February 28, 2012
TODAY’S DISCUSSION

SEMS Implementation Scheme
BSEE Observes Operator-Initiated Audits
 BSEE-Initiated Audits
 BSEE-Directed Audits


SEMS II


New provisions
Enforcement

Expectations
SEMS - Important Dates
3
DATE
EVENT
10/15/10 SEMS Final Rule Published
9/14/11
SEMS II NPR Published
11/14/11 SEMS II NPR Comment Period Closed
11/15/11 Mandatory Implementation of SEMS
11/22/11 SEMS PINCs are online
12/5/11
3/5/12
BSEE Observed Operator Conducted SEMS
Audit (I3P)
BSEE SEMS-Initiated Audits
3
SEMS
Resources
Headquarters
Chief – Operational
Safety Branch
(OSB)
National SEMS Coordinator
SEMS Regional Coordinator
GOMR
Chief - Office of
Safety
Management
(OSM)
BSEE SEMS
RESOURCES
SEMS Specialist
SEMS Specialist
SEMS Regional Coordinator
Pacific
Regional
Supervisor Field
Operation
Petroleum Engineer
Sr. Production Engineer
SEMS Regional Coordinator
Alaska
Regional
Supervisor Field
Operation
SEMS Specialist
SEMS
Resources
Headquarters
Chief Environmental
Enforcement
Division
GOMR
Supervisory
Environmental
Scientist
BSEE SEMS
RESOURCES
Pacific
Supervisory
Environmental
Scientist
Alaska
Supervisory
Environmental
Scientist
Environmental Scientist
Environmental Scientist
Environmental Scientist
Environmental Scientist
Environmental Scientist
Environmental Scientist
Environmental Scientist
Environmental Scientist
Implementation Plan

The following are methods that BSEE can use to
evaluate compliance with Subpart S.
 Operator-Initiated Audits
 I3P/DQP
 BSEE
Observes
 BSEE reviews audit report and monitors CAP
 BSEE-Initiated
Audits
 BSEE
may conduct SEMS audits for operators based upon
performance
 BSEE-Directed
 BSEE
Audits
may direct an operator to conduct an I3P audit of
their SEMS program
Operator Initiated Audit

Operator must notify BSEE at least 30 days in
advance



Lessee or I3P audits program




List of facilities
DQP or I3P
2 years from the initial implementation of the SEMS program and
at least once every 3 years thereafter
Comprehensive audit (all elements)
BSEE reviews operator audit report and Corrective
Action Plan (CAP)
BSEE monitors CAP
BSEE-Initiated Audit

*BSEE-initiated audits will evaluate the operator’s:





compliance with Subpart S /API RP 75
compliance with their own SEMS program
effectiveness of implementation and
effectiveness of communication amongst company personnel and
contractors
If BSEE conducts audit in lieu of I3P:


We will provide operator a report within 30 days
of audit completion
Operator must submit CAP
within 30 days of receiving BSEE’s audit report
*NOTE: An audit should not be confused with a traditional inspection
performed by BSEE for the purposes of gauging compliance with
BSEE – Directed Audits

Once notified operator must:
 Hire
I3P to conduct audit (250.1925)
 Pay for all costs
 Ensure I3P provides BSEE within 30 days of audit
completion
 Outline
the results of audit
 Deficiencies identified
 Correction plan
SEMS II - Points of Interest
JSA
(modifications)
Only I3P conducts
audits
Stop Work Authority
Ultimate Work
Authority
Employee Participation
Program
Reporting Unsafe
Working Conditions
10
SEMS II NPR Comments


34 sets of comments submitted to BSEE on the
SEMS II NPR
Themes:
 Jurisdiction
 Independent Third Party (I3P)
 Holistic Regulatory System
 Process Safety
 Job Safety Analysis (JSA)
 Ultimate Work Authority (UWA)
 Stop Work Authority (SWA)
BSEE Oversight


Auditing (Onshore & Offshore)
 Complete or partial
 Announced
Compliance w/ requirements of Subpart S
(API RP 75 & additional provisions)
 Records review
 Interviews/discussions
 Participate in safety meeting/JSA observation
 I3P/designated and qualified personnel
 Documentation of contractors
BSEE Enforcement Philosophy


62 new SEMS PINCs
If operator has no SEMS documented:


If operator has a SEMS but demonstrates no evidence
implementation:


Warning, component or facility shut in INC or a civil penalty
If operator has a SEMS and evidence showing only partial
implementation:


Component or facility shut in INC or a civil penalty
SEMS INCs
If operator has a SEMS and shows a good faith effort on
implementation:

BSEE to work with operator to improve SEMS
implementation
Summary
14



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
SEMS II Final Rule expected in calendar year
October 2012
BSEE has started observing operator conducted
audits and performing our own audits
Anticipate varying degrees of SEMS
implementation and compliance
Firm enforcement actions including INCs (w,c,s),
civil penalties and working with operator towards
continual improvement
BSEE will monitor CAP closely
Q&A
as Submitted to BSEE
Contractor Questions
1. Will an advocate, who understands the
operator's SEMS and business model, be
allowed to participate in the audit process?
The answer is yes if the advocate did not
participate in the development of the operator’s
SEMS.
2. Will there be flexibility to allow for various
means of reaching the same objectives?
The answer is yes as long as you are in compliance
with API RP 75 and 30 CFR 250.
SEMS is a risk-based program and different
methods can be used to achieve desired results.
BSEE will require evidence that the objectives were
defined according to the risk exposures and that
objectives were met and recorded.
3. Have any I3P organizations come forward
yet? If so, how are they and what criteria
makes them acceptable to BSEE?
BSEE has been involved with one I3P audit
conducted in the Pacific region. BSEE participated
as an “observer”. The agency reviewed the I3P’s
qualifications as defined in the audit plan, in
accordance with 30 CFR 250.1926. The I3P’s
qualifications complied with the regulation.
BSEE will not release the name of the operator or
I3P.
4. What steps will be taken to ensure uniformity
and consistency in SEMS enforcement?
BSEE has formed Regional SEMS teams which are
overseen by the National SEMS coordinator. The teams
have developed a PINC list which defines the audit
process and how to address deficiencies. The PINC list
ensures a uniform approach for enforcement. As far as
consistency, this will be handled Nationally.
5. Will BSEE publish its audit protocol? If not, why
not? The original stance was, no, it would not be
made public because somehow that would give an
advantage to the operators. If anything, it will only
allow operators to know where the goal post is.
PINCs provide the scorecard for regulatory achievement.
Since the objective of SEMS is to improve EHS
performance, BSEE’s audit protocols will not be shared.
Release of these protocols could result in industry focusing
on the protocol rather than their internal EHS challenges.
BSEE will ensure through it’s internal training program that
our auditors are capable of auditing SEMS programs within
the context of the operator EHS risk profile.
6. When will the SEMS II Final Rule be
published? Will it be close to the proposed
rule?
Headquarters has suggested that the SEMS II final
rule will be published around July/August 2012.
BSEE is currently reviewing and addressing
comments received on the proposed rule. At this
time it is premature to comment on what the final
rule will look like in comparison to the proposed
rule.
7. Will there be additional SEMS rulemaking, re: the
investigation findings from Macondo?
Based on experience BSEE and industry gains with
implementing SEMS we may or may not issue
another rulemaking after SEMS 2.
BSEE is still looking at all the reports, studies, etc. on
DWH. This evaluation coupled w/ experience gained in
implementing SEMS will determine if their are additional
rulemakings
8. SEMS II will require operators to “nominate” an
Independent Third Party (I3P) to audit their SEMS
program, subject to BSEE approval.
BSEE will not certify individuals or companies to conduct
I3P audits. BSEE requires I3P auditors to meet the
requirements defined in 30 CFR 250.1926. BSEE has the
ability to evaluate any I3P’s qualifications by auditing
documents, procedures or interviews.
If BSEE identifies issues associated with a specific I3P,
we have the authority to disallow them to conduct audits.
9. Will BSEE accept information in the form of
resumes of potential I3P auditors for review and
approval?
BSEE will accept any supporting information that
shows the subject I3P is in compliance with 30 CFR
250.1926.
A resume is an acceptable document.
For the I3P audit BSEE observed in the Pacific
Region the company submitted an audit plan with a
paragraph response on each element in 30 CFR
250.1926.
10. Will BSEE evaluate the overall
contractor/consultant company in its approval
process? If so, what company-wide criteria will
BSEE be looking for?
Per 30 CFR 250.1926(c), BSEE has the ability to
evaluate I3P qualifications by auditing documents,
procedures or interviews. If BSEE identifies issues
associated with a specific I3P, we have the authority to
disallow them to conduct audits and/or evaluate the
entire consulting company the I3P is associated with.
11. With regard to conflict of interest, if a contractor
developed only a portion of an operator’s SEMS
program, (e.g., Operating Procedures), will that
contractor be excluded from auditing
all other elements of that operator’s SEMS?
To avoid a conflict of interest, the Operator must
require that the I3P be independent from the
development or implementation of the SEMS program.
A statement signed by an Operator’s management that
the I3P auditor is not owned or controlled by or
otherwise affiliated with the Operator’s company is needed.
12. In the event a nominated I3P auditor is NOT approved
by BSEE, will the contractor receive a reason/explanation
for the denial?
Yes. If the National or Regional SEMS Coordinator
determines that the proposed I3P auditor does not meet the
qualifications set forth in the regulations, or that past or
existing relationships with the I3P auditor could affect the
I3P's ability to exercise independent judgment while
conducting the SEMS audit, BSEE will send a disapproval
letter to the operator.
Another I3P auditor must be proposed by the operator by
letter within thirty (30) days and sent to the National SEMS
Coordinator and the Regional SEMS Coordinator. If BSEE
accepts the operator’s proposed I3P or DQP, a response is
not necessary.
Lessee Questions
1. When doing an MOC for personnel change, such
as changing out operators, contract operators,
roughnecks, P&A personnel, etc., does this include
all personnel or is it just supervisors,
operators and above?
Please refer to NTL No. 2001-N09 and 30 CFR
250.1912(a)(3).
No. An MOC is not required for the normal shift change
out of personnel.
Yes. An MOC is required when an operator is using a
new contractor, supplier etc.
2. Does the agency support the Center for Offshore
Safety's work on accreditation of third party
independent auditors for SEMS auditing?
BSEE is monitoring the efforts of COS closely.
We are not just monitoring their auditing
efforts but other efforts such as developing
leading/lagging performance indicators.
At this present time BSEE has not formally
acknowledged COS auditing efforts
3. We audit our contractors for the existence of a
knowledge, skills and ability methodology to train
and evaluate personnel. We do not obtain
individual training records. Will that pass on an
audit?
Operators need not track the training records of
individuals unless it is described as a control in their
SEMS program. However, the tracking of individual
training may be the most efficient method of
overseeing your contractors.
4. I am having problems getting the "supervisor of the
person in charge of the task" signature for
contractors. The supervisor may not be at the site.
What are my options?
The supervisor of the PIC of a task must approve a
JSA prior to the commencement of work. This approval
can be either by email, by a web-based program, or in
writing as defined in the operator’s SEMS program. If you
allow for email, electronic signature, or web-based
program approval, it needs to be addressed in your SEMS
plan.
BSEE will require a formal traceable authority process at
all times.
5. SEMS PINC # S-401: The PHA is required for all
facilities in the GOM. Is the API RP 14C review the
minimum required for satellites and caissons?
There is no requirement for a “minimal” HA on a facility.
The decision on what type of HA to perform should be
based on the relative “risk” associated with a particular
facility, including unmanned caissons.
BSEE will only issue a S-401 INC (INC number is no
longer accurate) if an auditor determines an operator did
not conduct a HA in accordance with their SEMS plan.
Note: Operators need to be able to justify their selection of
risk assessment methodologies used. This justification should
include the ability to link the risk exposure evaluation to the
methodology used. Records should be available during an audit
which explain this process.
6. In addition to PHA’s for all facilities, are we
required to have design basis for relief system
available for inspectors?
Operators must have design basis for relief system for
all facilities; however, they will not be required to be
made available during an inspection (different then an
audit).
If a BSEE audit is conducted ALL documents should
be made available to ensure compliance with the
regulations and your SEMS plan, including the relief
system for your facility.
7. Will the District Inspectors be the ones going
offshore to inspect for compliance to SEMS?
BSEE audit teams will be made up of personnel
from the Regions, Districts and HQ. If an inspector
conducting a normal inspection (non-SEMS audit)
identifies a safety management issue, they can
make a recommendation to the Regional SEMS
coordinator about such issues.
Our day-to-day field inspections are not intended to
be SEMS audits.
8. Is the agency considering retracting/rescinding NTL
2011- N09? The NTL was not issued until 10/21/2011
which was less than one month before the SEMS rule
was to become effective. How do you expect industry to
comply with the NTL when it is issued almost a year
after published date and less than 30 days prior to the
effective date of the rule?
BSEE will not be retracting/rescinding NTL 2001-N09.
The NTL is a direct result of guidance/clarification requested
by Operators on the SEMS rule. The issue date of the NTL
had nothing to do with the SEMS effective date
(11/15/2011).
9. NTL 2011-N09, under 2. Environmental Information, states,
“Environmental resources to be considered in your SEMS
program include but are not limited to: biological resources
including protected species, chemosynthetic, and benthic
communities, Archeological and Cultural resources.”
Question is “What is the citation in Subpart S and in RP 75
that identifies that these items are to be included in the
SEMS plan/program?
Environmental concerns needing to be addressed in SEMS
go beyond Subpart S and API RP 75.
Environmental issues that need to be addressed in a SEMS
program are based on the lease document (archeological,
biological, marine mammal stipulations), approved plans
(POE, DPP, DOCD, DWOP, Pipeline), approved permits (APD,
APM) and associated Conditions of Approval.
10. Is industry correct in understanding that the audit
report, required by 250.1920(c), and the corrective
action plan, required by 250.1920(d), must be
submitted within the same limited timeframe?
Yes; both the Audit Report and CAP need to be submitted
within 30 days.
If BSEE has issues with your proposed schedule to correct
any deficiencies we will have14 days after receipt of the
CAP to inform you that your proposed schedule is not
acceptable.
BSEE will also inform you, in writing, that your proposed
schedule is Acceptable.
11. What is the timing of the SEMS 2 final rule
and when can industry expect to see it
published?
Headquarters has suggested that the SEMS II
final rule will be published in the July/August,
2012 timeframe.
12. What is BSEE’s anticipated effective date
of the rule?
At this time BSEE anticipates that the effective
date of the final SEMS II rule will be November
2013.
This allows for completion of the first 2 year SEMS
audit cycle.
13. Will the SEMS 2 final rule require the use of I3P
only to conduct the required audits? What
information was used by the agency to justify the
proposal?
This concern is currently being evaluated by BSEE.
The Agency believes that the use of an I3P will provide
for increased objectivity in regards to improving
personnel safety and achieving environmental
protection as compared to utilizing a designated and
qualified person of the operator.
14. Regarding the “Reporting of unsafe working
conditions”, what was the purpose of this proposal
when the current regulation at 250.193 already has
similar language? Did you consider abandoning the
proposed regulation and consider amending the
current regulations?
There is a difference between what is presented in SEMS II
and what is required by 30 CFR 250.193.
250.193 does not address the reporting of unsafe work
conditions in a comprehensive manner while SEMS II does.
SEMS II address the reporting of these events, provides a
nationwide phone number for reporting, assures anonymity
and requires training as related to unsafe work conditions.
15. What is BSEE’s expectation for a Pipeline
Transmission company which owns and operates a
DOT regulated transmission pipeline and the
associated offshore structures installed under a
DOI/BSEE issued ROW permit? Are these pipeline
companies, who do not have any leases, produce or
drill wells, expected by BSEE to Develop and
implement a SEMS program under 30 CFR
250, Subpart S?
Please refer to NTL No. 2011-N09. Policy item 1: “Who
needs a SEMS program?” As defined in 30 CFR 250.105,
“You” as used in Subpart S, includes a lessee, the owner or
holder of operating rights, a designated operator or agent of
the lessee(s), a pipeline right of-way holder, or a State
lessee granted a right-of-use and easement.
16. When does the BSEE plan to begin
inspections?
BSEE does not conduct inspections in regards to
SEMS implementation. The agency conducts
audits.
BSEE will conduct our first audit the week of
March 5th.
During this SEMS audit, BSEE will visit both the
onshore office and offshore facilities.
17. Will the BSEE audit all 13 elements of SEMS
at once or audit certain elements in stages?
BSEE will conduct both comprehensive and partial
audits.
The BSEE audit team will determine
whether the audit will address the entire SEMS
program or only parts of it (complete vs. partial).
Note: Operators need to be ready to be audited on all
elements.
18. What does the BSEE expect for operators to
provide to prove contractor competency during an
audit?
To prove contractor competency, BSEE auditors can
interview/test contractors during either the onshore or
offshore components of the audit.
BSEE can review your SEMS program to confirm
that it includes provisions for evaluating the
skills/knowledge/training of your contractors and that you
are following through as written in the SEMS program.
Note: Operators need to define what contractor
evaluations/verifications they will implement and be ready
to provide records of implementation.
19. What is the expectation of the information
turnover during property transfer? Specifically:
A. if I acquire a platform and 6 months later am
audited by BSEE, is it my responsibility to ensure
that I have information going back the required 2 to
6 years (i.e. testing and inspection data, MOC data,
etc)
This process should be covered by the pre-startup
review process and if any non-solvable compliance
issues occur, it should be communicated to BSEE
BSEE does expect you to have a current and up-todate HA for the acquired facility at the time of
acquisition and that this facility is fully addressed in your
SEMS.
B. If I acquire a platform, is it BSEE’s
expectations that I will write operating
procedures re-written to my company’s
standards prior to operating the platform?
Does BSEE recognize the potential impact?
Current and up-to-date operating procedures need to be
in place upon acquisition of a facility.
20. What is the agency’s expectation to
documentation of Ultimate Work Authority?
Your SEMS must identify the person on the facility or
MODU with UWA.
Proper documentation needs to be available showing the
UWA designation by the operator and explained in
their SEMS program. Such documentation needs to
be available during an audit.
Acceptable forms can be paper or electronic; can include
a letter or a posted notice on the facility or MODU.
Operators must ensure that all personnel clearly know
who has UWA.
21. The SEMS NTL has some information that
contradicted the proposed SEMS II rule; is this
going to cleaned up, either via a new NTL or in the
new SEMS II rule?
BSEE is unclear as to what information in the NTL
contradicted the proposed SEMS II rule.
Nothing has been presented to us on this matter.
22. The agency seemed to add some new rules/expectations
in the NTL, especially around the biologic and archaeological
expectations, which then made it into the PINC list. However,
NTLs do not represent a regulatory requirement; is the
agency going to revise their audit procedure to account for
this?
The NTL attempted to clarify existing SEMS regulatory
requirements. Environmental concerns needing to be addressed
in SEMS go beyond Subpart S and API RP 75.
Environmental issues that need to be addressed in a SEMS
program are based on the lease document (archeological,
biological, marine mammal stipulations), approved plans
(POE, DPP, DOCD, DWOP, Pipeline), approved permits (APD,
APM) and associated Conditions of Approval.
23. Has any progress been made on
establishing independent third auditor
credentials, certifications, training, etc.?
BSEE will not certify or accredit I3Ps or any affiliated
training with SEMS.
24. Following major acquisitions will there be a
grace period to establish compliance and Review
previous company’s processes for integration into
new owners plan?
BSEE expects an operator to have a complete and upto-date SEMS program in effect upon completing an
acquisition.
25. What is the expectation for verifying
skills/knowledge of contractor employees prior to
accessing work site?
Your SEMS program must address how you will verify that
contractors are trained in the work practices necessary to
perform their jobs in a safe and environmentally sound
manner.
BSEE will review your SEMS program to confirm that it
includes provisions for training/evaluating/verifying
contractors and that you are following through as written in
the plan.
BSEE’s expectation is that each operator has a safety
management system in place that allows for them to verify
their contractors are trained prior to them accessing their
work sites.
26. Is it true USCG is working to get items under
their jurisdiction included in SEMS II?
BSEE and USCG are working together in the
Prevent Workgroup to address jurisdictional issues on SEMS
and safety management systems.
BSEE is in the process of developing an MOU between the
two Agencies to address SEMS jurisdictional areas.
BSEE is participating with USCG in an OSHA sponsored
work group evaluating the use of a safety management
system for all (onshore and offshore) oil and gas operations.
27. For JSA’s kept for 2 years, can these be
unsigned electronic copies or must they be wet
ink signed actual JSA’s used at the worksite?
JSA’s need to be signed.
JSA’s can be original or copies.
JSA’s can be paper or electronic as defined in the
operators SEMS program.
28. Does the Lessee have to keep contractors’
JSAs or will the contract company be
accountable for their JSAs for their own
auditing purposes?
Example: Will B&S Welding be sending their
JSA's to their safety dept. for retention or will
we keep them on site?
Operator is responsible for keeping JSA’s.
29. When does SEMS apply to a facility being
developed / installed? How does SEMS apply to
the contractors installing the facility?
SEMS applies when facility is installed…when it
touches the seabed.
Once the facility touches the seabed then those
contractors on the facility need to be covered by SEMS
and any contractors on a motor vessel also need to
be addressed in the operators SESM if such motor
vessel is tethered, moored or attached to the facility.
Questions?
SEMS@bsee.gov
David Nedorostek
(703) 787-1029