Offshore drilling companies will now have to provide comprehensive hazard reports and emergency contingency plans before they will be eligible to receive a license for offshore drilling in European waters, after a new bill was approved by the EU Energy Committee earlier this month.
The bill, which is still a draft law, was approved by the EU Energy Committee with a significant majority vote of 48 to 7, and also requires that offshore drilling licenses will only be approved for firms that can show evidence of enough cash flow to cover the costs of a potential environmental disaster. The final step before the draft law can be enforced is a council negotiation.
The bill comes in response to the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, which lead to billions of dollars’ worth of environmental damage due to the crew’s inability to limit the extent of the oil spill.
Ivo Belet, who drafted the new bill, stated that the European Union should learn from the Deepwater Horizon catastrophe and take measures to prevent a similar event from occurring in the future through a ‘solid legislative framework’. Belet will be leading the negotiations with the council to institute the new legislation.
Oil drilling firms would need to provide evidence of financial security that would cover possible liabilities and compensation pay outs that would need to be made in the event of an oil spill, explosion or similar accident resulting from their drilling activities. In addition, oil companies will have to provide authorities with a major hazards report including a description of the drilling installation, potential hazards that could arise and measures that can be taken to prevent or limit the extent of such hazards. In particular, the safety of crew members should take priority in these hazard reports. The report will need to be submitted at least 24 weeks before the proposed start of drilling operations, and will have to be reviewed at least every five years.
Finally, companies will also need to submit an internal emergency response plan, detailing the actions that will be taken in the event of an emergency. In addition, all member countries of the EU will need to submit an external emergency response plan to detail their response in the case of a drilling catastrophe in offshore regions that are under their jurisdiction.
Although the bill was initially intended to be a binding regulation, members of the Energy Committee have now proposed that the legislation rather be a directive, giving member states the opportunity to decide on their own means to achieve the goals of better offshore safety.
