Commonwealth Numbered Regulations - Explanatory Statements

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PETROLEUM (SUBMERGED LANDS) (MANAGEMENT OF SAFETY ON OFFSHORE FACILITIES) AMENDMENT REGULATIONS 2000 (NO. 1) 2000 NO. 249

STATUTORY RULES 2000 No. 249

Issued by the Authority of the Minister for Industry, Science and Resources

Petroleum (Submerged Lands) Act 1967

Petroleum (Submerged Lands) (Management of Safety on Offshore Facilities) Amendment Regulations 2000 (No. 1)

Section 157 of the Petroleum (Submerged Lands) Act 1967 (the Act) states that the GovernorGeneral may make regulations, not inconsistent with the Act, prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act. The section specifies, at paragraph 157(2)(e), that these matters include securing, regulating, controlling or restricting the construction, erection, maintenance, operation or use of installations, equipment or facilities.

The purpose of the Regulations was to amend the Petroleum (Submerged Lands) (Management of Safety on Offshore Facilities) Regulations ("principal Regulations") so that certain requirements that previously appeared in the Act about constructing and using secondary lines and water lines. (explained below) became part of the Regulations. These requirements have to do with safety. In addition, the principal Regulations were amended so that infrastructure facilities (explained below) and gas re-injection pipes (explained below) are also covered by what is required in the principal Regulations.

The need for most of the amendments arose from recent amendments to the Act made by the Petroleum (Submerged Lands) Legislation Amendment Act (No. 1) 2000 (Amendment Act). This repealed, in part, sections 60, 61, 62 and 72 of the Act and also repealed some other sections dealt with under the Petroleum (Submerged Lands) Amendment Regulations 2000. This was done because these provisions were technical in nature and more appropriately belong in the Regulations.

The repeal is effective from 7 September 2000, which is 6 months after Royal Assent. The delay in date of effect was approved to allow these Regulations to be made before the date.

The deleted portions of sections 60, 61, 62 and 72 were about maintaining safety in constructing and operating secondary lines and water lines. These are pipes that serve certain technical purposes in petroleum exploration and production but are not classed as pipelines within the meaning of the Act. In consultation with the States, Northern Territory and industry, it was agreed that most of what needed to be done for secondary lines and water lines could be done by changing or adding to the definitions in the principal Regulations. Doing this set up appropriate safety rules for secondary lines and water lines which are the same as the ones applying to most other offshore petroleum plant, equipment and facilities.

The Amendment Act also created the new title of infrastructure licences which allow a company to construct and operate "infrastructure facilities". These are facilities that are intended for various processing or control activities in or near an oil-field where the operator does not have a production licence over the area in which the facilities are located. By adding to the definitions in the principal Regulations, appropriate safety rules were likewise extended to cover infrastructure facilities.

Gas re-injection pipes are used to re-inject into the seabed gases like carbon dioxide. This is being done because of concerns: about the effect of greenhouse gases on the atmosphere. Pipes of this type are a relatively recent development and they also needed to be brought under the principal Regulations.

The plan to make the deleted parts of sections 60, 61, 62 and 72 of the Act into Regulations was cleared by the States, Northern Territory and the petroleum industry in the lead-up to introducing the Bill which later became the Amendment Act. More recently, the States, Northern Territory and industry bodies were given the opportunity to comment on the Regulations and they endorsed them.

Accordingly, these Regulations:

*       added to and amended the definitions in the principal Regulations so that secondary lines, water lines, infrastructure facilities and gas re-injection pipes are clearly covered by the principal Regulations (see Schedule 1, items 2, 3 and 4 of the Attachment); and

*       inserted a transitional provision to cover existing secondary lines and water lines (see Schedule 1, item 5 of the Attachment).

Details of the Regulations are set out in the Attachment.

The Regulations commenced on the day when the repeal of the abovementioned provisions came into effect, ie on 7 September 2000.

ATTACHMENT

Regulation 1- Name of Regulations

This Regulation provides the title of the Regulations.

Regulation 2 - Commencement

This Regulation provides for the commencement of the Regulations on the day when item 34 of Schedule 1 to the Petroleum (Submerged Lands) Legislation Amendment Act (No. 1) 2000 comes into effect. This is one of the items that repeals a provision in the Act for the purpose of making it into a regulation. The day when this is to occur is 7 September 2000.

Regulation 3 - Amendment of Petroleum (Submerged Lands) Regulations

This Regulation provides that the amendments to the Petroleum (Submerged Lands) (Management of Safety on Offshore Facilities) Regulations are as set out in Schedule 1.

SCHEDULE 1 AMENDMENTS

Item 1 - Regulation 1

This item brings the citation of the principal Regulations into line with current practice.

Item 2 - Subregulation 3(1), definition of facility, paragragph (b)

The current definition of a "facility" reads as follows:

'facility means a vessel or structure located in an adjacent area that:

(a)       is used or constructed for the recovery of petroleum; or

(b)       carries, contains or includes equipment for drilling, or for carrying out other operations in connection with a well, from the vessel or structure;

and includes a combination or series of 2 or more related facilities, but excludes a vessel engaged merely in site surveys or investigations to a depth in the seabed not exceeding 100 metres."

This item amends paragraph (b) so that it goes together with the definition of "operations in connection with a well" that is inserted by the next item.

Item 3 - Subregulation 3(1), after definition of major accident event

This item inserts a definition of "operations in connection with a well" which ensures that infrastructure facilities are covered by the principal Regulations. Paragraphs (b), (c), (d) and (e) of the definition are taken from the definition of infrastructure facilities in the Act and they set out the purposes for which infrastructure facilities could be used. Paragraph (f) is intended

to ensure that the principal Regulations will also apply to gas re-injection pipes.

Item 4 - Subregulation 3(1), after definition of specify

This item inserts a definition of "structure" to make it clear that secondary lines, water lines and gas reinjection pipes are parts of a structure. They are therefore covered by the definition of a "facility" which means they are also covered by the principal Regulations. The definition does not include pipelines as separate regulations have been drafted to cover them.

Item 5 - After regulation 45

This item inserts the new Regulation 46, which is a transitional provision to cover the situation where an existing secondary line or water line has been approved to operate under the repealed parts of section 60 of the Act. Without a provision of this kind, after these Regulations came into effect, a company continuing to use one of these lines would be breaching the principal Regulations because a Safety Case would not yet have been prepared and accepted about it.

A Safety Case is a detailed document, required to be prepared by the operator of an offshore facility, that sets out the things!' that have been done to ensure that the facility is safe. Having an accepted Safety Case for a facility is an important requirement in the principal Regulations. Given that the principal Regulations have been in force since 1996, an existing secondary line or a water line must by its nature be attached to at least one structure for which a Safety Case is in force. All Safety Cases must be revised every 5 years. This Regulation allows the existing secondary line or water line to be operated as normal until the next revision of the Safety Case of a structure to which it is attached. At that time, the secondary line or water line is to be looked at and reported on in the revised Safety Case. In the meantime, however, the company operating the secondary line or water line may not modify, remove, dismantle or decommission the line without, having prepared a Safety Case about it.