BSEE Director Brian Salerno Weighs in on Offshore Ops

Brian Salerno was sworn in as the Director of the Bureau of Safety and Environmental Enforcement (BSEE) on August 26, 2013. He is responsible for promoting safety, protecting the environment and conserving resources through the vigorous regulatory oversight and enforcement of offshore operations on the U.S. Outer Continental Shelf. Prior to his appointment as Bureau Director, Salerno served as the U.S. Coast Guard’s Deputy Commandant for Operations where he was responsible for establishing and providing operational strategy, policy, guidance and resources as needed to meet national priorities for U.S. Coast Guard missions, programs and services. Previous Washington, D.C.-based assignments included serving as the Assistant Commandant for Marine Safety, Security and Stewardship, Assistant Commandant for Policy and Planning, and Director of Inspections and Compliance. Salerno was commissioned as an ensign in the U.S. Coast Guard in December 1976 after attending Officer Candidate School. Over the course of his 36-year active duty career, Salerno attained the rank of Vice Admiral, serving predominantly within the U.S. Coast Guard’s marine safety program. He is also a 2000 graduate of the U.S. Army War College, with a Masters in Strategic Studies. In addition, he holds a Master’s Degree in Management from the Johns Hopkins University. He is licensed as a master of small passenger vessels. At a time when things could certainly be going better for the industry he regulates, Salerno weighs in on offshore operations from the unique perspective afforded him from the c-suite at BSEE.

 

In the wake of the 2010 Deepwater Horizon tragedy, there was a sentiment that regulatory functions related to safety, environmental protection, and resource conservation should reside in a bureau solely dedicated to those duties. BSEE’s creation on October 1, 2011 resulted in a process of continuous regulatory standardization and enhancement. A number of practical changes have occurred since 2011 including the expansion of Safety and Environmental Management Systems (SEMS), finalization of the Well Control Rule, the Arctic Rule, the Production Systems Safety Rule, and the Decommissioning Costs Rule. BSEE also created a near-miss reporting system (SafeOCS) for safety-related data collection and analysis, and launched joint inspections with the U.S. Coast Guard. All of these changes coincide with doubling the number of inspectors and increasing the staff of engineers. Taken together, these changes are part of a comprehensive effort that forms the foundation of a safer offshore energy industry. We caution, however, that government can only do so much, and the companies themselves, with BSEE’s encouragement, must take the steps needed to create a robust and integrated offshore safety culture, one that expands beyond single companies and is truly “industry-wide.”  
 

SEMS is an ongoing story that is yielding continuous improvement. However, it is still in the maturation phase for many companies. The requirement to implement a SEMS became effective in 2011 and was further refined in 2013. The SEMS regulation is aimed at changing the dynamic between operators and regulators from one of compliance checking to one of performance measurement. The difference is that a performance requirement puts ownership of the means to achieve the expected level of safety performance on the operator. This changes how the operator approaches its regulatory responsibilities, because having flexibility to select the means of operation requires that you think about what you are going to do today, and rethink it tomorrow, instead of just relying on compliance checklists. As the industry and BSEE have gained more experience with this approach, we are seeing quicker identification of issues that need to be addressed, as well as deeper commitments to act on those issues. 

 

BSEE actively conducts research and evaluates current and emerging technologies for operations ranging from the drilling of oil and gas exploration wells to the removal of platforms and related infrastructure. The research efforts are part of our ongoing effort to reduce risks across all offshore operations. BSEE’s Technology Assessment Program (TAP), which operates through contracts with universities, private firms, and government laboratories, evaluates safety-related technologies. TAP has administered nearly 900 research and development projects since its inception. BSEE has aggressively maintained a comprehensive, long-term research program dedicated to improving industry’s ability to respond to oil spills. The major focus of research in this area is improvement of the methods and technologies used for oil spill detection, containment, treatment, recovery and cleanup. We engage in cooperative efforts that bringing together funding and expertise from research partners in government agencies, industry and the international community to advance the ability of industry to quickly respond should a spill occur. We conduct unannounced inspections to make sure that every offshore operator is ready to immediately deploy resources in the event of a spill.

The offshore energy industry is extremely innovative. New technologies are continually developed, and many of these technologies have the potential to make the offshore working environment safer. One of BSEE’s mandates is to make sure that the offshore industry is using the “Best Available and Safest Technology.” BSEE’s BAST program is the regulatory program that identifies and assesses proven technologies on the Outer Continental Shelf. The BAST program receives technical assistance from BSEE’s Engineering Technology Assessment Center. ETAC provides BSEE’s headquarters, region and district offices with consulting expertise, value-added solutions, and the comprehensive review of newly developed and emerging technologies. The work performed by the staff at the Engineering Technology Assessment Center does not impact the permitting approval process for industry but it does help everyone involved identify the strengths and weaknesses of new technology. 

 

BSEE aggressively maintains a comprehensive, long-term research program dedicated to improving oil spill response options. BSEE’s Ohmsett facility, the largest oil spill response test facility in North America, includes a 667-foot test tank that contains 2.6 million gallons of saltwater maintained at open ocean salinity. A computer controlled wave generator at one end of the tank creates waves up to 3 feet high, while an adjustable wave-damping ‘beach’ system at the opposite end of the tank helps control the shape of the waves. Researchers can tow equipment through the water at speeds up to 6 knots, simulating a vessel towing oil spill response equipment such as booms and skimmers. With the potential for increased oil production in, and transport through, Arctic regions, BSEE decided to fund the development of a new skimmer – one that could more efficiently recover oil in icy waters. Named the IceHorse, this skimmer is designed to travel under ice, surface when it reaches broken ice, and collect oil from places where water and ice form a patchwork. It was engineered to add systems that allow it to maneuver both at the water surface and underwater.   

 

BSEE is currently exploring the idea of risk-based inspections. We have a pilot project currently underway to test the feasibility of conducting risk-based inspections on a broader scale. There are good reasons to believe that risk-based inspections will help improve safety on the OCS. Our analyses indicate that 80% of safety-related incidents occur on about 20% of facilities. Applying the principles of risk assessment and management, it seems clear that BSEE should focus its resources where the problems are located. In order to improve its risk assessment capacity, BSEE has partnered with NASA to study their management approaches to risk. Both BSEE and NASA oversee work in harsh and uncompromising environments, and both rely on cutting edge technology to go deeper and further than previously thought possible. The BSEE-NASA partnership brings together technical experts from both agencies to focus on the specific risks associated with offshore operations so that we can continue to find ways to improve safety for offshore workers and protect the environment. NASA will share its experiences related to probabilistic risk assessment with BSEE. Embracing a probabilistic risk assessment approach will allow BSEE to quantitatively model risk. NASA is presently using this approach for the International Space Station and Orion deep space capsule programs. BSEE believes that it can more effectively assign risk once its staff can calibrate the NASA approach so that it can be applied to the Outer Continental Shelf energy industry.

 

While BSEE as a regulatory agency cannot compete with industry in terms of salary rates, we do offer opportunities for qualified professionals to have exposure to a broad range of industry programs and issues. BSEE has been working with Congress and the Office of Personnel Management to seek approval of special higher salary rates for petroleum engineers, geologists, geophysicists, structural engineers and inspectors working in specific regions. To date we have been able to offer such incentives for some positions. The opportunity for public service and the ability to make a difference in an important energy industry are also two very positive incentives for pursuing a career with BSEE. BSEE’s staff members have many opportunities to contribute to regulatory work across the industry and gain valuable experience as employees in government service. 

 

We are an efficient agency that tries to leverage its impact whenever possible. We have ramped up the number of personnel to meet our mission, including inspectors from below 60 to over 120 in just over five years. At BSEE, we have created a sense among the offshore industry that the Bureau is holding them to a high standard. That is as it should be. Our current resources allow us to adequately fulfill that mission.

 

BSEE and the Coast Guard share jurisdiction over the OCS regulatory space. For example, BSEE oversees all oil and gas activities and operations as well as spill preparedness and response planning, while the Coast Guard is responsible for most oil spill response activities. BSEE and the Coast Guard have increased the level of coordination through quarterly meetings at the headquarters level and the regional level, an updated Memorandum of Understanding, and joint training. That increased coordination has also led to joint inspections and investigations, and environmental preparations. The combination of BSEE’s laser-like focus and the Coast Guard’s tremendous human and material assets results in a coordinated regulatory environment that maximizes the probability of safe outcomes on a daily basis. 

 

BSEE and the Coast Guard have been very public in their statements about the need for a more robust and integrated offshore energy industry safety culture. Neither of us believes a truly embraced safety culture can be achieved through regulation, but it can be encouraged by regulators. I recently discussed this issue at a National Academy of Science Workshop focused on its report on strengthening the safety culture of the offshore oil and gas industry. It is not enough for individual companies to have a robust safety culture; the entire industry needs a safety culture. All offshore contractors need a safety culture. We need prominent leaders because we need an industry-wide safety culture that is owned by the industry. This is really industry’s reform; it will only exist if the industry owns it.

 

By its nature, SEMS is a performance-based approach. We can all see that the prescriptive approach is easy to quantify, because you are inspecting for compliance against a checklist. However, it is well known in the regulatory community that a hybrid approach – one that employs both prescriptive and performance-based regulation – leads to safer outcomes. The offshore energy industry will always be inspected prescriptively, but the dimension of adding SEMS presents a performance-based opportunity. SEMS has definitely prompted many companies to better articulate their safety goals. It has provided a roadmap that, if followed, can greatly reduce risk. The SEMS audit process provides a critical examination of each company’s SEMS, and over time we have seen the audit process improve through the accreditation processes. BSEE has also given auditors clearer expectations for what constitutes an acceptable audit plan and audit report. Taken together, more companies are providing audit reports with deeper insights into their management system challenges. We have seen the SEMS of many companies move in the direction of SEMS maturation. But a SEMS is a process of continuous improvement. When a company prepares its SEMS thoughtfully, only promising what it can deliver, and then actually delivers on the SEMS, we have reached a point of significant improvement. Of course, every SEMS should be viewed as something that needs to be revisited and opportunities for improvement, as well as application of lessons learned, should be part of that continuous improvement process.

 

As a performance based program, BSEE is looking for continuous improvement. All operators now have a SEMS program in place. BSEE will continue to work with the operators and the corrective action plans that are based on the audits.

 

The commitment that industry leaders have to safety is put to the test during these times. When BSEE observed the price downturn, we were worried that we would see a spike in incidents, that the number of injuries would go up, and that the number of oil spills might in go up. But the truth is that – so far – we’re not seeing obvious signs of the feared outcome, and we think it might be reasonable to attribute that to the emergence of leadership that is resident within the industry. There is a sense that there is a growing tendency to put a commitment to safety front and center, to embed it into all your normal work processes. We are cautiously optimistic when we look at the future of SEMS and its value to the industry. We think it has had a beneficial effect through this downturn. We caution, however, that we have not fully analyzed statistics for the fiscal year just ended, September 30, 2016. Also, safety may be a lagging indicator of a tight fiscal environment, due to the possibility of delayed maintenance.
 

 

(As published in the November 2016 edition of Marine News)