Offshore Safety in the Wake of the Macondo Disaster: The Role of the Regulator

By Weaver, Jacqueline L. | Houston Journal of International Law, Spring 2014 | Go to article overview

Offshore Safety in the Wake of the Macondo Disaster: The Role of the Regulator


Weaver, Jacqueline L., Houston Journal of International Law


c. The "COS World" of SEMS Auditing

COS was born into this SEMS I world and immediately set out to create an auditing process appropriate for deepwater operations in the Gulf. The "COS World" depicted in Figure 2 below shows the process that COS created and that COS members must use to audit their SEMS I programs. Much more detail appears in the COS documents themselves.

[FIGURE 2 OMITTED]

Several features of COS World bear noting. First, no formal arrow links BSEE to COS World. While BSEE had adopted API RP 75 as the basis of its SEMS I regulations, COS simply took the regulations and then created its own auditing system. Thus, two parallel SEMS auditing worlds exist, both designed to assure that the audited company has an operationally effective SEMS program, not just a paper file prepared by consultants and sitting on an operator's shelf or in an electronic file. Of the two, the COS system is far more specific and robust than the auditing provision in RP 75, as incorporated into the SEMS I regulations. If an operator conducts a COS audit, this audit will meet all auditing requirements in SEMS I World. The converse is not true.

Second, COS plays a defining role in accrediting the companies, now called Audit Service Providers (ASPs), that are allowed to perform COS audits. COS polices every phase of the auditing process, from setting minimum qualifications for the audit team leader and team members to creating standardized audit reporting formats, protocols and time tables. (153)

Third, all of the actions involved in performing an audit occur between the Audit Service Provider and the COS Member in terms of developing an audit plan, performing the audit, creating a Corrective Action Plan (CAP), and verifying that it has been completed. (154) Once a company is accredited by COS as an ASP, COS has no role in the actual auditing process. In reality, however, because the ASP must use COS-created forms and templates, COS's hands are deep inside every COS member's audit.

Fourth, after the audit report is final, COS steps back into the picture in an important way. The ASP is required to send the final audit report to COS with no company-identifying information. (155) COS will use the confidential data thus obtained to prepare analyses as described further below. (156) If authorized by the COS member company, the ASP may also submit a summary of what it found to be a good practices(s) used by that COS member. (157)

Finally, there is a possible relationship between the individual COS Member and BSEE, if the COS Member is an operator/lessee rather than a drilling contractor or service provider. (158) The COS Member who is a deepwater operator/lessee can carry its COS audit report from "COS World" over to "SEMS I World." The COS audit process satisfies the audit requirements for SEMS 1. (159) Shallow-water operator/lessees can use all of the COS documents posted in COS World to help assure that their internal or external auditors are performing a robust audit. However, COS will not receive any audit report information from operators who work only in shallow water because they are not COS members.

d. The SEMS II World: BSEE and COS Meet

On April 5, 2013, BSEE issued SEMS II, which revised and added several new elements to the SEMS I rule, effective as of June 4, 2013. (160) SEMS II also revised the auditing procedure to require that all SEMS programs be audited by an accredited third-party auditor. The "SEMS II World" is depicted in Figure 3 below, and it is here that BSEE and COS (as an Accreditation Body, or "AB") are formally linked.

[FIGURE 3 OMITTED]

BSEE will begin to receive SEMS II audits after June 4, 2014. (161) The SEMS II World has several notable features. First, four distinct players appear in this world. BSEE and the operator/lessee remain, but the "auditor" under SEMS I has become two new entities: an AB and an ASP. …

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