Offshore Petroleum Facility Incidents Post Varanus Island, Montara, and Macondo

Have We Really Addressed the Root Cause?

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Abstract

This Article analyzes the role of offshore petroleum legislation in contributing to offshore facility integrity incidents in Australia’s offshore petroleum jurisdiction. It examines the regulatory framework that existed at the time of the Varanus Island, Montara, and Macondo facility incidents, determining that the regulatory regime contributed to each of these incidents. Assessing the response of the Commonwealth government to the regulatory framework existing at the time of the events, particularly the integration of well regulation as part of the National Offshore Petroleum Safety Authority’s (“NOPSA”) functions and the establishment of a national offshore regulator, this Article determines that while the integration of well management into NOPSA’s functions has been a valuable and a significant improvement. There is still a likelihood that differing standards applied to the regulation of petroleum facilities (“Safety Case Regime”) and wells (“Good Oilfield Practice”), multiple regulators, and regulatory disjuncture may continue to contribute to facility incidents. This Article concludes that the establishment of the National Offshore Petroleum Titles Authority, the retainment of the Joint Authority, and the enhancement of NOPSA’s functions to include environmental management have created a regulatory framework that is complex, increasingly convoluted, and has not addressed the root cause of facility incidents in Australia’s offshore petroleum jurisdictions.
Original languageEnglish
Article number2
Pages (from-to)585-612
Number of pages28
JournalWilliam and Mary Journal of Environmental Law and Policy
Volume38
Issue number3
Publication statusPublished - May 2014

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title = "Offshore Petroleum Facility Incidents Post Varanus Island, Montara, and Macondo: Have We Really Addressed the Root Cause?",
abstract = "This Article analyzes the role of offshore petroleum legislation in contributing to offshore facility integrity incidents in Australia’s offshore petroleum jurisdiction. It examines the regulatory framework that existed at the time of the Varanus Island, Montara, and Macondo facility incidents, determining that the regulatory regime contributed to each of these incidents. Assessing the response of the Commonwealth government to the regulatory framework existing at the time of the events, particularly the integration of well regulation as part of the National Offshore Petroleum Safety Authority’s (“NOPSA”) functions and the establishment of a national offshore regulator, this Article determines that while the integration of well management into NOPSA’s functions has been a valuable and a significant improvement. There is still a likelihood that differing standards applied to the regulation of petroleum facilities (“Safety Case Regime”) and wells (“Good Oilfield Practice”), multiple regulators, and regulatory disjuncture may continue to contribute to facility incidents. This Article concludes that the establishment of the National Offshore Petroleum Titles Authority, the retainment of the Joint Authority, and the enhancement of NOPSA’s functions to include environmental management have created a regulatory framework that is complex, increasingly convoluted, and has not addressed the root cause of facility incidents in Australia’s offshore petroleum jurisdictions.",
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AB - This Article analyzes the role of offshore petroleum legislation in contributing to offshore facility integrity incidents in Australia’s offshore petroleum jurisdiction. It examines the regulatory framework that existed at the time of the Varanus Island, Montara, and Macondo facility incidents, determining that the regulatory regime contributed to each of these incidents. Assessing the response of the Commonwealth government to the regulatory framework existing at the time of the events, particularly the integration of well regulation as part of the National Offshore Petroleum Safety Authority’s (“NOPSA”) functions and the establishment of a national offshore regulator, this Article determines that while the integration of well management into NOPSA’s functions has been a valuable and a significant improvement. There is still a likelihood that differing standards applied to the regulation of petroleum facilities (“Safety Case Regime”) and wells (“Good Oilfield Practice”), multiple regulators, and regulatory disjuncture may continue to contribute to facility incidents. This Article concludes that the establishment of the National Offshore Petroleum Titles Authority, the retainment of the Joint Authority, and the enhancement of NOPSA’s functions to include environmental management have created a regulatory framework that is complex, increasingly convoluted, and has not addressed the root cause of facility incidents in Australia’s offshore petroleum jurisdictions.

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