Disappointing agreement on new EU offshore drilling safety directive

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Crucial missing elements include a moratorium in the Arctic and rules for EU companies drilling in developing countries


February 21, 2013
Madrid
Contact:
Marta Madina ( [email protected] )




Today, the EU informal trialogue came to an agreement on the proposed Directive on safety of offshore oil and gas activities – a legislation initiated by the Deepwater Horizon catastrophe in the Gulf of Mexico in 2010. Oceana is disappointed by the weakening of the legislation, whose legal basis of a Regulation was turned into a Directive – which is far less prescriptive to countries. The agreed text falls short of ambitions in a number of areas, particularly in failing to increase EU supervision and controls through the European Maritime and Safety Agency, dropping the proposed moratorium in the Arctic, and rejecting calls for improved transparency.  

Furthermore, the requirement for operators to demonstrate sufficient financial resources to cover accidents was held off until further assessments, and socio-economic compensation to affected fishermen or tourism operators were excluded from the deal. The EU also gave up on its intention to oblige EU companies conducting offshore operations outside of EU waters to respect the provisions laid down in the future Directive. This particularly shameful move not only recognizes that oil companies can apply lower standards in developing countries for instance, but also creates a dangerous precedent for legitimizing future moral hazards.

“It is outrageous that Member States would adopt a weakened legislation that allows business-as-usual for the powerful oil industry at the expense of EU citizens, public health and the environment. We missed a great opportunity to act collectively at the European level to put out a truly stringent harmonized regulatory framework for offshore drilling,says Xavier Pastor, executive director at Oceana in Europe.

On the other hand, the provisional text agreed upon does include some improvements, namely:

  • a stronger emphasis on operators’ responsibility to respect safety and environmental standards and to continuously improve emergency response and preparedness through the introduction of major hazards reports,a clarification that liability for environmental damage includes strict requirements for applicants to demonstrate sufficient financial resources to cover accidents
  • the future criminalisation of oil pollution activities under European law
  • ‘oil-spill response effectiveness’, a new risk calculation tool, is recognized as a key component of the safety and environmental prevention system.

”We are pleased that the Oil Spill Response Effectiveness tool was adopted to objectively quantify time when emergency plans are impeded because of environmental conditions - such as wind, waves, ice or low temperatures,” adds Nicolas Fournier, policy advisor. “In certain locations, harsh weather conditions can severely reduce response effectiveness to less than 40%, meaning that six times out of ten no intervention would be possible for cleaning-up and recovering the oil!”

This agreement comes after months of negotiations between representatives of the European Parliament (Ivo Belet, EPP), the Irish Presidency of the European Council and the Commission, who forged a compromised text which will be submitted for final approval to EU Energy Ministers and the European Parliament Plenary before the summer.

Facts about offshore hydrocarbon drilling in Europe:

  • Nearly 1000 offshore installations are operating in the EU
  • The European Commission estimates the annual cost of a major offshore oil/gas accident in EU to be on the range of 205 - 915 million euros.
  • Between 1974 and 2010, 2.2 million tons of oil were spilled during exploration and production activities[1].
  • The Deepwater Horizon disaster has so far cost BP 28.3 billion euros.
  • There is no international treaty requiring compensation to be provided in cases of spills from offshore installations. Currently, only maritime accidents are covered in the International Oil Pollution Compensation Funds of 1992.

[1] Eckle, P., Burgherr, P. and Edouard Michaux, E. (2012). Risk of Large Oil Spills: A Statistical Analysis in the Aftermath of Deepwater Horizon. Environmental Science & Technology. 46: 13002-13008. Doi.org/10.1021/es3029523