American Oil and Gas Reporter - September 2015 - 49

BSEE Well Control Rule Draws Rebuke
WASHINGTON-Industry comments
on the Bureau of Safety and Environmental
Enforcement's proposed changes to offshore exploration and production regulations assert the rules inspired by the Deepwater Horizon explosion and oil spill are
ill-advised and may increase rather than
reduce environmental and safety risks.
The proposed rule, "Oil and Gas and
Sulphur Operations on the Outer Continental
Shelf-Blowout Preventer Systems and
Well Control," addresses the range of systems and equipment related to well control
operations, BSEE says. The agency adds
it designed the measures to improve equipment reliability, building on enhanced industry standards for blowout preventers
and prevention technologies. The proposed
rule includes new requirements for well
design and control, casing, cementing, realtime monitoring, and subsea containment.
According to the agency, the proposed
rule is intended to also consolidate equipment and operational requirements common to other subparts of its regulations
pertaining to offshore oil and gas drilling,
completions, workovers, and decommissioning. The rule would implement multiple
recommendations resulting from investigations into the April 20, 2010, Deepwater
Horizon incident. BSEE adds the proposed
rule also incorporates guidance from several notices to lessees and operators.
BSEE published the notice of proposed
rule making on April 17. The original
60-day comment period was extended
by 30 days, and ended July 16.
Proposed Changes
The most effective way to communicate
consistent requirements for blowout preventers across all drilling, completion,
workover and decommissioning operations
is to consolidate them in one location,
BSEE says. Accordingly, it says the proposed rule consolidates BOP requirements
throughout 30 CFR Part 250 into Subpart
G. BSEE says it divided the section into
general and rig requirements, well operations, BOP system requirements, and
records and reporting.
"The sections contained within this
new subpart would apply to all drilling,
completion, workover, and decommissioning activities, unless explicitly stated
otherwise," BSEE states.
In future rule makings, BSEE says it
intends to include additional requirements
for operations and equipment. Those will
include new well-control planning, procedures, training and certification, requirements for personnel servicing critical
equipment, and choke and kill systems,

the agency indicates.
BSEE reports it is proposing an effective
date of three months following the final
rule's publication. Under the new rules,
operators would be required to:
* Comply with the real-time monitoring requirements within three years of
publication of the final rule;
* Install double shear rams on subsea
BOPs and on surface BOPs on floating
facilities within five years; and
* Install shear rams that center drill
pipes during shearing operations within
seven years.
BSEE also seeks to change the margins
used to ensure drilling fluids exert enough
pressure within a well to keep oil and
gas from flowing out of formation without
exerting enough pressure to damage the
surrounding rocks. Under current regulations, operators must maintain a "safe"
drilling margin, media sources indicate,
although BSEE rules do not define what
that is nor what data should be used to
calculate it. The agency's proposal codifies
a safe drilling margin as one-half pound
a gallon between the weight of the drilling
fluids and the amount of pressure a formation can withstand without fracturing.
According to media reports, one of the
major problems leading to the Deepwater
Horizon explosion was the operator's failure
to analyze downhole data and change its
drilling margin to reflect actual conditions.

Drilling Margins
The American Petroleum Institute,
Independent Petroleum Association of
America, National Ocean Industries Association, Offshore Operators Committee,
Petroleum Equipment & Services Association, U.S. Oil & Gas Association, and
International Association of Drilling Contractors jointly filed comments criticizing
the proposed rule.
The group predicts the proposed change
to the safe drilling margin will have significant practice and economic consequences in the design and construction
of both Outer Continental Shelf and deepwater wells. The coalition reports it analyzed 175 OCS wells drilled since June
2010 that it notes were completed under
existing regulations without significant
well control incidents. The coalition says
that under the proposed regulations, 63
percent of those wells could not have
been drilled as designed because they required drilling margins less than BSEE's
proposed standard.
The group contends the unintended
consequences of the proposed drilling
margin will include significant economic

and operational hurdles because of increased
casing requirements and smaller production
casing sizes, resulting in reduced or noncommercial production rates. It adds that
evaluation capabilities also may be affected
because of smaller holes, while some new
prospects and infill drilling programs will
become undrillable.
Offshore leases provide operators with
valuable contractual and property interests,
the coalition points out, saying the federal
government materially breaches a lease
when it substantially impairs its value by
imposing new procedures that were not
bargained for under the lease.
"Further, an arbitrary, prescriptive safe
drilling margin based only on mud weight
and leak-off test criteria may actually
reduce the safety of drilling operations as
the operator may not be able to choose the
mud density best suited for the interval
based on drilling and geological parameters,"
the coalition warns. "A lower mud weight
may have to be used to meet the proposed
requirement. The resulting reduction of
the mud weight overbalance to the formation
could create wellbore stability problems
or potentially allow undesired influx of
formation fluid into the wellbore."
Prescriptive Regulations
The industry coalition also asserts the
impact of the proposed requirements
would have a negative impact on industry
as it develops and deploys technologies
such as managed pressure drilling, dual
gradient drilling, and riser pump systems.
It points out those technologies are deployed in narrow drilling-margin environments to allow operators to effectively
manage drilling conditions. Those technologies can improve drilling safety margins, the group states.
"Overly prescriptive regulations that
do not allow for the use of these technologies provide a disincentive to develop
them," the coalition reasons. "If these
regulations are imposed in the United
States, they will create a competitive disadvantage to OCS leaseholders."
In separate comments, Exxon Mobil
Corp. asserts BSEE's proposal will increase risks by imposing technically unsubstantiated regulations that will block
operators from applying the most fit-forpurpose well design and operations to a
given risk profile.
"The proposed regulations would significantly increase the size, cost and footprint of a drilling facility, and in many
cases could not be installed or retrofitted
on existing drilling and production facilities," Exxon Mobil says.
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SEPTEMBER 2015 49

American Oil and Gas Reporter - September 2015

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