Impact of New US BOP Rules on OCS Compared to UK & Norway

  • The Macondo disaster gave new impetus to reviews of offshore safety rules in the US, the UK and Norway
  • The UK and Norway regard their existing regulatory environment comprehensive enough whereas the US is set to introduce a roster of new BOP-specific rules to prevent a Macondo-type disaster from reoccurring
  • The US regulatory approach has a tendency to more prescriptive than its UK and Norwegian counterparts applying blanket costs vs a more situation-specific approach
  • The API estimates that the new US rules will reduce US offshore spending by c. $1.287 billion annually
  • There is a considerable discrepancy of c. $3.4 billion between the BSEE’s and API’s estimate of additional compliance cost with the new rules
  • Both UK and Norway seem not entirely convinced that new BOP requirements will significantly improve safety
  • In response, the offshore drilling industry has begun to develop coping strategies by outsourcing the provision and maintenance of BOP equipment
  • Notably, the industry seems to have maintained focus on preventing incidents in core areas such as well control without additional regulations but spending cuts make it more difficult to maintain the overall safety record

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