Concepts related to offshore oil and gas operations

Arbejdstilsynet, The Danish Working Environment Autrority (WEA) guideline 65.1.1 on Concepts related to offshore oil and gas operations

June 2016

This guideline describes principles and concepts from the Offshore Safety Act and regulations pursuant to the Act.

The guideline deals with the most important principles of the Offshore Safety Act and elaborates on definitions of key concepts in the Offshore Safety Act and associated Executive Orders relevant for an understanding of these principles. This guideline includes the following:

1. Main principles of the Offshore Safety Act

2. Definition of operations etc.
2.1 Offshore oil and gas operations 
2.2 Offshore 
2.3 Licensed area 
2.4 Commencement of operations 
2.5 Exploration 
2.6 Combined operation

3. Definition of installation etc. 
3.1 Installation 
3.2 Production installation (including production) 
3.3 Non-production installation 
3.4 Mobile installation 
3.5 Fixed installation 
3.6 Permanently manned installation
3.7 Accommodation
3.8 Non-permanently manned installation
3.9 Construction of the installation 
3.10 Design of the installation
3.11 FPSO (Floating Production, Storage and Offloading unit)
3.12 FSO (Floating Storage and Offloading unit)
3.13 Connected infrastructure
3.14 Pipelines
3.15 Equipment
3.16 Construction product
3.17 Element
3.18 Safety and environmental critical elements
3.19 Safety zone

4. Definitions in relation to players involved 
4.1 Enterprise 
4.2 Enterprise manager 
4.3 Licensee 
4.4 Operator 
4.5 Owner 
4.6 Contractor 
4.7 Employer 
4.8 Offshore installation manager 
4.9 Supervisor 
4.10 Employee 
4.11 Safety organisation

5. Definitions of concepts related to management of health and safety 
5.1 Risk management 
5.2 Major accident 
5.3 Serious personal injury 
5.4 Accident 
5.5 Occupational diseases 
5.6 Near miss 
5.7 Major environmental incident 
5.8 Independent verification 
5.9 Internal emergency response plan 
5.10 External emergency response plan 
5.11 Personal protective equipment

Numbers in parentheses following the definitions refer to the provisions of the Offshore Safety Act or associated Executive Orders.

1. Main principles of the Offshore Safety Act

The Act regulates management of health and safety risks and risks of major environmental incidents. In this context, major environmental incidents only concern marine pollution as a result of major accidents in connection with offshore oil and gas operations. 

The objective of the Act is to promote a high level of health and safety, which is in accordance with technical and social developments in society, and this level must, as a minimum, be the same as the onshore level, adapted to the special conditions offshore. Thus, the level of health and safety is not static, but develops dynamically in line with technological developments in society that are relevant to offshore operations. Similarly, the level must also reflect social developments in society in terms of what is broadly acceptable, e.g. with respect to the risk of fatalities, the risk of serious personal injuries, health conditions and welfare facilities such as accommodation facilities on the installation. That the level must correspond to the level onshore means that the regulations according to the Working Environment Act are generally applied for regulation offshore, but special conditions offshore, both technical conditions and, with respect to mobile installations, international conditions, are also taken into account. The health concept as used in the Offshore Safety Act thus corresponds to the equivalent concept in the Working Environment Act, which entails protection against industrial accidents and occupational diseases in a traditional sense, as well as protection against other exposures that may adversely affect physical or psychological health. 

Furthermore, the Act creates a framework for enterprises to resolve health and safety issues themselves in connection with offshore oil and gas operations. 
This means that inspections to determine whether the health and safety level is satisfactory and whether risks of major environmental incidents have been adequately reduced must primarily be conducted by the enterprises themselves. This principle is based on the assumption that players who, through their actions, expose others to health and safety risks and risks of major environmental incidents should also be responsible for eliminating or reducing these risks. In order to ensure that the players, i.e. the enterprises, manage health and safety risks and risks of major environmental incidents in accordance with the Act, or regulations pursuant to the Act, they must establish a management system for health and safety. The health and safety risks and risks of major environmental incidents must be brought to a level which is as low as reasonably practicable (ALARP). Enterprises must document in a Health and Safety Document (also known as a Health and Safety Case (HSC)) that this principle has been applied in accordance with their management system. The HSC will be the key document in the processing by the supervisory authorities of applications for permits and approvals. 

The administrative burden of enterprises should be limited as far as possible. Thus, the burden imposed on enterprises by the authorities according to the Act should not be greater than concerns for safety, health and the marine environment necessitate. This principle is in keeping with relevant principles on relieving the administrative burden of enterprises. One of the consequences of the principle is that supervision by the authorities is primarily targeted at the management systems of enterprises, i.e. management and documentation of health and safety conditions as well as risks of major environmental incidents offshore.

2. Definition of operations etc.

2.1. Offshore oil and gas operations

“All activities associated with an installation, connected infrastructure or pipelines, including design, planning, construction, installation offshore, as well as the operation, modification and decommissioning thereof, relating to exploration, production and pipeline transport of oil and gas as well as other substances and materials between the offshore installation and onshore installation, or between several offshore installations.” (Section 3(1), no. 16, of the Offshore Safety Act.) 

“Pipeline transport between the offshore installation and onshore installation” means transport via pipelines between an installation in the Danish sector and an installation onshore, or between several installations in the Danish sector, see definition in section 3 below. 

Consequently, pipeline transport via transit pipelines is not covered by the definition, and is not regulated by the Offshore Safety Act, but by the Continental Shelf Act. 

The definition covers all activities associated with an installation etc.; thus, the activities do not have to take place at the actual installation, connected infrastructure or pipeline, as long as the activity is associated with the installation. Examples of this include well stimulation at an installation by a well stimulation vessel, pipe laying by a pipe-laying vessel, or lifting by a crane vessel of equipment or parts of an installation to be used on an installation. When the crane vessel is used to install a new production installation offshore, lifting operations involving a risk of major accidents will be covered by the operator’s responsibility to prevent major accidents, and the risk of major accidents will be part of the operator’s risk management. 

Consequently, in these cases it is not the vessels, but rather the operations that are covered by the regulations.

2.2. Offshore

”Situated in the territorial sea, the Exclusive Economic Zone or the continental shelf of Denmark within the meaning of the United Nations Convention on the Law of the Sea.” (Section 3(1), no. 15 of the Offshore Safety Act.) 

The definition is linked to the definition of offshore oil and gas operations above, and specifies the geographical area regulated by the Act. 

2.3. Licensed area

 

”The geographical area covered by the permit of the licensee.” (Section 3(1), no. 23 of the Offshore Safety Act.) The licensee is described in section 4. 

Licensed area is synonymous with the term “concession area”. 

The definition should be seen in the context of the definition of “licensee” in section 4.

2.4. Commencement of operations

”The point in time when the installation or connected infrastructure is involved for the first time in the operations for which it is designed.” (Section 3(1), no. 21 of the Offshore Safety Act.) 

Examples of operations include commencement of oil and gas production or commencement of drilling.

2.5. Exploration

”Drilling into a prospect and related offshore oil and gas operations necessary prior to production-related operations.” (Section 3(1), no. 5. of the Offshore Safety Act.) 

As this definition is linked to a drilling operation that is necessary prior to production-related operations, and consequently is covered by an exclusive licence for exploration and production pursuant to section 5 of the Subsoil Act, the definition does not cover preliminary investigations and scientific investigations, cf. section 1(2) as well as sections 3 and 24 of the Subsoil Act. These investigations are not covered by an exclusive licence as described, but require separate licences. The prospect, which is the subsoil area considered to be a possible hydrocarbon reservoir, is identified by means of preliminary investigations, typically seismic investigations.

2.6. Combined operations

”An operation carried out from an installation with another installation or installations for purposes related to other installation(s) which thereby materially affects the health and safety risks on any or all of the installations.” (Section 3(1), no. 13 of the Offshore Safety Act.) 

The installations involved need not be linked by a bridge, but they can be. The crucial point is that one of the installations involved may affect the safety risks at another installation. Examples include drilling of a production well on a fixed installation using a mobile drilling unit, as well as accommodation units in connection with an installation, either in the form of platforms or vessels. The assumption is that the bridge link is temporary. If an installation is permanently bridge-linked to another installation, this is not covered by the definition of combined operations, but is instead covered by the definition of an installation, cf. section 3.

3. Definition of installation etc.

3.1. Installation

”A fixed or mobile facility used for offshore oil and gas operations or in connection with such operations, or a combination of such facilities permanently inter-connected by bridges or other structures. Installation shall not cover mobile facilities when sailing or being towed.” (Section 3(1), no. 1. of the Offshore Safety Act.) 

In addition to platforms and other facilities, the definition also covers drillships and FPSOs (described in section 3.11). FSOs (described in section 3.12), on the other hand, are considered connected infrastructure if they are located within the safety zone (500m from the installation), see the definition of connected infrastructure in section 3(1), no. 29, of the Offshore Safety Act, as well as the associated explanatory notes below; otherwise, they are considered installations. Vessels performing operations similar to the operations performed by drillships, e.g. well maintenance etc., in situations where the well is not located on a platform or similar, are considered drillships within the meaning of the Offshore Safety Act, and consequently as installations. These operations will typically cover well operations on existing subsea production wells. This means that vessels performing well operations in connection with a well on a platform or similar are not covered by the definition of an installation. The risks associated with operations from such vessels will have to be controlled by the operator or the owner of the platform in question, or similar, and the shipowner will be considered as the contractor. A crane vessel is another example of a vessel not covered by the definition of an installation, as the operation from the crane vessel is connected with an existing platform or similar, or with installing a new platform where the risks of the operation are managed by the platform operator. Pipe-laying vessels are also excluded from the definition, and are regulated under maritime legislation. Any risks associated with pipe-laying operations close to an installation are managed by the operator and the owner of the installation, respectively, just as the risks of collision with other ships, whereas any risks associated with the pipeline are managed by the owner of the pipeline. 

Construction of the pipe-laying vessel, the working environment on the vessel, and accommodation facilities are subject to maritime regulations. 

Platforms etc. used for accommodation for persons working at an associated installation, i.e. hotel platforms, are covered by the definition, whereas vessels used for the same purpose are not covered. Only the accommodation section (“hotel section”) of such vessels that is used for accommodation for persons working at an associated installation is regulated by the offshore safety legislation. It is not important what kind of work the persons accommodated perform at the associated installation. This means that catering staff, for example, who work at the associated installation, but whose accommodation is on the vessel, are covered by the offshore safety legislation. 

The remaining part of the vessel is not regulated by the Offshore Safety Act, but is regulated according to international maritime regulations as well as Flag State regulations, if relevant. This also applies to persons performing work on the vessel, i.e. the maritime crew and any other persons employed to perform work onboard the vessel. Examples of the latter type of employees include catering staff and any crane operators, electricians, etc., not performing work at the associated installation. 

Further information about maritime regulations is available from the Danish Maritime Authority. 

Installations that are inter-connected by bridges are considered as one installation according to the definition. It is assumed that this only applies to permanent bridge links. Installations with non-permanent bridge links are considered to be combined operations, see the definition in section 2. Whether or not a bridge link is to be considered permanent will rely on a specific assessment, but if the bridge link has been established for the purpose of remaining part of the installations for the rest of the operating period, and the bridge-linked installation will form part of the operations at the other installation, the link will be considered permanent. It is not a condition for being considered one installation that the bridge-linked installations are operated by the same enterprise. In practice, in most cases the installations will have the same operator or owner. If this is not the case, the different operators or owners must enter an agreement on joint operation. Examples of permanently bridge-linked installations are Gorm, Tyra, Dan and Halfdan, as their bridge links are integrated in the design and are planned to remain part of the installations for the rest of their operating period. Another example could be the need to permanently expand the accommodation capacity at a fixed installation by establishing a bridge link to a mobile accommodation unit, where the bridge link is intended to remain part of the combined installation for the rest of the operating period. The combined installation will be considered one installation, but an operator and an owner, respectively, will be responsible for operations. The definition of installations does not include pipelines, which are defined below.

3.2. Production installation (including production)

“An installation used for oil and gas production.” (Section 3(1), no. 20 of the Offshore Safety Act.) “Production” means “offshore extraction of oil and gas from the underground strata of the licensed area including offshore processing of oil and gas and its conveyance through connected infrastructure.” (Section 3(1), no. 19 of the Offshore Safety Act.) Test production in connection with drilling is not covered by the concept “production” within the meaning of the Act, because “extraction” is for the purpose of onward transportation and possibly prior processing. Drilling rigs performing such test production operations will therefore not be considered production installations. 

In addition to fixed production installations, FPSOs as well as restructured mobile non-production installations for hydrocarbon production are covered by the definition.

3.3. Non-production installation

”An installation not used for oil and gas production.” (Section 3(1), no. 11 of the Offshore Safety Act.) 

Examples include mobile drilling rigs, mobile accommodation units and well intervention vessels. A non-production installation may also be a fixed installation, e.g. fixed hotel platforms.

3.4 Mobile installation

”A mobile installation which can be moved from one position to another by sailing or towage, and which is intended to be used in several different positions throughout its lifetime.” (Section 3(1), no. 14 of the Offshore Safety Act.) 

A mobile installation is an installation that can either sail under its own power or that can be towed, i.e. it is able to float. Furthermore, the installation is generally intended to be used at several different positions. Examples of such installations include drilling platforms (drilling rigs) and accommodation platforms for temporary use at one position, after which they are relocated to a new position, either by towage or by sailing under their own power. In some situations, vessels will be considered as mobile installations, see the definition of installations above. Floating installations will be considered as fixed installations if they are designed to remain in the same position throughout their lifetimes, see also the definition of fixed installations below. 

The definition primarily concerns installations that are registered in a register of shipping and therefore have an International Maritime Organization (IMO) number, because these are inherently intended for use in several positions.

3.5. Fixed installation

”An installation which is not a mobile installation.” (Section 3(1), no. 9 of the Offshore Safety Act.) 

A fixed installation is thus any installation not covered by the definition of mobile installations, see above. Consequently, the definition of fixed installations covers all installations that are permanently affixed to the sea floor and cannot be moved by towage or sailing, but it may also cover floating installations designed to operate at a given position throughout their lifetime. An example of an installation that is permanently affixed to the sea floor is a production installation in the Danish sector, while an example of a floating installation is certain FPSOs constructed and designed to operate in a specific oil and gas field, e.g. because the sea depth is too great for an installation to be affixed to the sea floor.

3.6. Permanently manned installation

”An installation planned for use as overnight accommodation.” (Section 3(1), no. 18 of the Offshore Safety Act.) 

Permanently manned installations, also referred to as ”manned installations”, are usually manned throughout the lifetime of the installation, but the definition also covers installations that are only manned periodically, provided that overnight stays take place on the installation during such periods, unlike non-permanently manned installations, which are manned occasionally, but at which overnight stays do not take place on the installation, see the definition below.

3.7. Accommodation

“Sleeping rooms, messes, recreation rooms, shower rooms and toilet compartments, treatment rooms and kitchen facilities forming part of a permanently manned installation or located on ships or other facilities used as accommodation for persons working on production installations or fixed non-production installations.” (Executive Order no. 1195, section 2(1), no. 15.) 

In Executive Orders nos. 1338 and 1190, the definition of accommodation is worded slightly differently, but it covers the same as the definition above.

3.8. Non-permanently manned installation

”An installation which is not a permanently manned installation.” (Section 3(1), no. 10 of the Offshore Safety Act.) 

Usually, such installations will only be manned occasionally and for short periods of time, without overnight stays, in connection with maintenance tasks etc. For tasks of longer duration, e.g. construction works or tasks related to important operational conditions, the installation must be accessed either via an associated non-production installation or via an accommodation vessel where overnight stays are possible. In this way, the installations can be manned for 24 hours a day in shifts, so that people working on the installation do not spend their leisure time there. 

Overnight stays, i.e. sleeping on the installation, are only possible in emergency situations, e.g. due to weather conditions. Non-permanently manned installations are also referred to as “unmanned installations”.

3.9. Construction of the installation

”The design, dimensioning and structure of elements used in installation components and the inter-assembly of installation components.” (Executive Order no. 1190, section 2, no. 11, and Executive Order no 1195, section 2(1), no. 6.) 

Examples of installation components include load-bearing structures, topsides, process modules, well modules, accommodation modules, etc.

 

3.10. Design of the installation

 

”An overall description of the installation prior to project planning.” (Executive Order no. 1195, section 2(1), no. 11.) 

This term is used in connection with the definition of offshore oil and gas operations, see section 2, when submitting a notification according to section 27 of the Offshore Safety Act, at several other places in the Offshore Safety Act, and in Executive Orders nos. 1190 and 1195. Project design means planning of continued work on the installation after the design has been concluded, see also the definition of offshore oil and gas operations (section 2.1).

3.11. FPSO (Floating Production, Storage and Offloading unit)

An FPSO (Floating Production, Storage and Offloading unit) is not defined in the Offshore Safety Act, but it is a production installation which is a floating unit, usually a ship, from where hydrocarbons are produced and processed. The installation is furthermore used for storage and shipping of oil. 

Any gas produced on the installation is burned or, if the right facilities are in place, it may be transformed to LNG (Liquified Natural Gas) for subsequent storage and shipping.

 

3.12. FSO (Floating Storage and Offloading unit)

 

An FSO (Floating Storage and Offloading unit) is not defined in the Offshore Safety Act, but it is a floating unit, usually a ship, for storage and shipping of oil. The oil usually comes from a near-by production platform. 

An FSO located within the safety zone of a production installation is considered connected infrastructure. An FSO located outside the safety zone is considered an installation.

3.13. Connected infrastructure

“Within the safety zone 

a) any well and associated structures, supplementary units and devices connected to the installation, 

b) any apparatus or device on or fixed to the main structure of the installation, 

c) any connected pipeline system, or 

d) any other connected structure that is used for storage and loading of oil and gas produced by a production installation, and that is permanently connected to such an installation.” 

(Section 3(1), no. 29 of the Offshore Safety Act.) 

Point a) covers wells and pipework, equipment etc. that form part of the well structure. 

Point b) covers other devices that are physically connected to the installation, e.g. risers. 

Point c) covers the part of the pipeline system located within the safety zone. 

Beyond this, pipelines are not covered by the definition, see the definition of pipelines below. 

Furthermore, the definition covers facilities used for storage of hydrocarbons and loading of oil onto tankers, for example (point d). This includes Floating Storage and Offloading (FSOs).

3.14. Pipelines

Pipelines are not explicitly defined in the Offshore Safety Act, but are considered to be the part of a pipeline system running from the connected infrastructure of one installation to the connected infrastructure of another installation, or from the connected infrastructure of an installation to the, in practice, first shut-off valve onshore. This also follows implicitly from the definition of “owner”: An enterprise legally entitled to control the operation of a non-production installation or of a pipeline that connects installations, or pipelines from installations to the shore.

3.15. Equipment

“1. Machinery, containers, apparatus, tools and any other similar devices that: 

a) are used in the processing of a product, 

b) are used in order to bring about a work result, including for transport and storage, or 

c) serve in the performance of a technical process. 

2. Parts of such devices, prefabricated structures and any other manufactured object intended to form a finished unit together with other objects.” 

(Executive Order no. 1338, section 2(2), Executive Order no. 1190, section 2, no. 16, Executive Order no. 1195, section 2(2)). 

Equipment can be divided into:

1. Machinery covered by the Machinery Directive, cf. Executive Order on Design etc. of Machinery (issued pursuant to the Act on the Design, etc. of Certain Products).

2. Machinery not covered by the Machinery Directive, cf. Executive Orders no. 1195 and no. 1190.

3. Pressure equipment as defined in:
a) Executive Order on certain EC directives on pressure vessels (issued pursuant to the Working Environment Act). 
b) Executive Order on the design, etc. of simple pressure vessels (issued pursuant to the Act on the Design, etc. of Certain Products). 
c) Executive Order on the design, etc. of pressure equipment (issued pursuant to the Act on the Design, etc. of Certain Products). 
d) Executive Order on design, modification and repair of pressure equipment (issued pursuant to the Working Environment Act). 
e) Executive Order on the use of pressure equipment (issued pursuant to the Working Environment Act). 
f) Executive Order on the use of transportable pressure equipment (issued pursuant to the Working Environment Act). 
g) Executive Order on the design, etc. of transportable pressure equipment (issued pursuant to the Act on the Design, etc. of Certain Products). 
h) Executive Order on the design, etc. of aerosols (issued pursuant to the Act on the Design, etc. of Certain Products).

4. Electrical equipment.

If the equipment specified above is used in potentially explosive atmospheres, it is defined as “Equipment intended for use in potentially explosive atmospheres”, which means:

a) Equipment, protective systems and components, having regard to their use in potentially explosive atmospheres and 
b) safety, control and regulating devices intended for use outside of potentially explosive atmospheres, but which are required for, or which contribute to, the capacity of equipment or protective systems to operate safely in connection with risks of explosion.

Definitions and further specification of equipment intended for use in explosive atmospheres as well as classification of such equipment into equipment groups and categories for control purposes can be found 
a) for mechanical equipment intended for use in potentially explosive atmospheres, in Annex 1 to the Executive Order on the design, etc. of equipment and protective systems for use in potentially explosive atmospheres (issued pursuant to the Act on the Design, etc. of Certain Products), and 
b) for electrical equipment intended for use in potentially explosive atmospheres, in Annex 1 to the Executive Order on electrical equipment and electrical protective systems for use in potentially explosive atmospheres (issued pursuant to the Electricity Safety Act).

3.16. Construction product

“Any product or system that is produced and marketed for the purpose of forming a permanent part of an installation or parts thereof, and whose performance affects the performance of the installation with regard to the fundamental requirements applicable to such installations.” (Executive Order no. 1195, section 2(1), no. 8.) 

The definition has been adapted to offshore installations on the basis of the definition in the Executive Order on marketing, sale and market surveillance of construction products (issued pursuant to the Building Act) that applies to production installations and fixed non-production installations, cf. section 11 of Executive Order no. 1195, but not to connected infrastructure and pipelines.

3.17. Element

“Installation components, equipment or non-physical components, e.g. computer software.” (Executive Order no. 1338, section 2(1), no. 3.)

3.18. Safety and environmental critical elements

“Parts of an installation, equipment or components, including computer programmes, the purpose of which is to prevent or limit the consequences of a major accident, or the failure of which could cause or contribute substantially to a major accident.” (Section 3(1), no. 25 of the Offshore Safety Act.) 

Components include both physical and non-physical components. 

As a rule, most environmental-critical elements are also safety critical. 

Examples of safety and environmental critical elements:

  • Process equipment on production installations
  • Wells on production installations (production wells), including both well control equipment (valve trains etc.) and components in the well (casing, pipes etc.)
  • Wells during drilling, including both well control equipment (BOP etc.) and components in the well (casing, pipes, drilling liquid etc.)
  • Flame, smoke, gas and H2S detectors
  • Alarms
  • Fire-fighting equipment
  • Emergency power supplies
  • Uninterruptible Power Supply (ESD, Emergency Shut Down)
  • Rescue equipment (only safety critical)
  • Bearing structures
  • Escape routes (only safety critical)
  • Muster area (only safety critical)

In the Health and Safety Document for the installation, the operator and the owner must state the safety and environmental critical elements.

3.19. Safety zone

“The area within a distance of 500m from any part of the installation.” (Section 3(1), no. 26 of the Offshore Safety Act.) 

The definition is in line with section 3 of Executive Order no. 657 of 30 December 1985 on safety zones and zones to keep order and to prevent dangers (issued pursuant to the Continental Shelf Act).

4. Definitions in relation to players involved

4.1. Enterprise

“Any natural or legal person or any group of such persons.” (Section 3(1), no. 31 of the Offshore Safety Act.) 

The definition covers both companies and unincorporated enterprises, or groups of such companies or enterprises, e.g. consortia. 

Enterprises in the Danish offshore area include both Danish and foreign enterprises. Foreign enterprises performing work in the Danish sector must be registered in the Register of Foreign Service Providers (RUT) if they are not established in Denmark and have a central business registration (CVR) number. Read more at the DWEA website.

4.2. Enterprise manager

“Any person authorised through their position to take part in the overall management of the enterprise.” (Section 3(1), no. 32, of the Offshore Safety Act.) 

The definition is in line with the concept used in the Working Environment Act, and primarily concerns directors, including managing directors. However, the formal title etc. is not decisive for determining whether a person should be considered an enterprise manager. Members of the board of directors are also considered to be included in the group of enterprise managers etc., with the same duties as employers in terms of board resolutions related to health and safety. Other managers, e.g. technical directors, finance directors and others who are essentially responsible for managing or supervising specific enterprise activities, rather having overall management responsibility for the enterprise as a whole, are considered supervisors within the meaning of the Act, see the definition of supervisor below.

4.3. Licensee

”The enterprise or group of enterprises which, pursuant to the Danish Subsoil Act, is authorised to carry out offshore oil and gas operations.” (Section 3(1), no. 22 of the Offshore Safety Act.) 

The “Sole Concession of 8 July 1962” has a special status. The concession is held by A. P. Møller-Mærsk A/S and Mærsk Olie og Gas A/S, referred to as the “concession holders”. The duties and responsibilities of the concessions holders are the same as those of the licensees. 

Synonyms of licensee are “rights holder” or “license holder”.

4.4. Operator

”The enterprise appointed by the licensee or the Minister for Climate, Energy and Building to conduct, on behalf of the licensee, the activities the licensee is authorised to carry out pursuant to the Danish Subsoil Act, including planning and executing a well operation or managing and controlling the functions of a production installation.” (Section 3(1), no. 17 of the Offshore Safety Act.) 

The operator is responsible for the operation of production installations and is responsible for performing well operations. In the latter case, the operator is also referred to as the “well operator” who has hired the drilling contractor and other contractors to perform well operations.

4.5. Owner

”An enterprise legally entitled to control the operation of a non-production installation or of a pipeline that connects installations, or pipelines from installations to the shore.” (Section 3(1), no. 6 of the Offshore Safety Act.) 

In most cases, the owner of drilling rigs will be the drilling contractor. 

The concept of owner as used in the Offshore Safety Act does not correspond to the property law concept. For example, the title to a drilling rig is often held by an enterprise other than the drilling contractor. Similarly, the enterprise responsible for operation of pipelines is generally different from the enterprise holding the title to the pipelines.

4.6. Contractor

”An enterprise contracted by another enterprise, including the operator or owner, to perform specific tasks.” (Section 3(1), no. 8 of the Offshore Safety Act.) 

Examples of contractors performing work for the operator include, in addition to the owner of a non-production installation, well-maintenance firms, painters, catering businesses, well-logging firms, cementing firms, firms managing drilling chemicals and other special operations, as well as others performing maintenance or construction work. Examples of contractors performing work for the owner include catering businesses and painters. 

Enterprises which station individuals with other enterprises (“user enterprises”), e.g. with the operator, in order to temporarily perform tasks under the supervision and management of the user enterprise are not considered contractors within the meaning of the Act. As the individuals in question will receive instructions from the user enterprise, the user enterprise is the employer of these individuals within the meaning of the Offshore Safety Act, see the definition of employer below, but this does not apply to situations not covered by the Offshore Safety Act. In all other cases, the enterprise stationing individuals is the employer.

4.7. Employer

”The enterprise authorised to instruct employees who carry out work on an installation.” (Section 3(1), no. 3 of the Offshore Safety Act.) 

It has been found relevant to base the definition on the authority to give instructions rather than on the employment relationship. Thus, if an employee is employed by employer B, but employer A is authorised to give instructions to the employee, the employee is considered as equivalent to employer A’s other employees. The operator, the owner and the contractors will usually, but not always, be employers as well, as they are authorised to give instructions to their own employees and those of other employers. Employer A’s responsibility only covers actual health and safety conditions related to the work on the installation. An example of this is a contractor on shore (employer B) who stations three employees on an installation, where they perform work according to instructions given by the operator. In this case, within the meaning of the Act, the operator (employer A) will be the employer of the three employees stationed by the contractor. Conversely, a contractor who stations a working shift comprising a supervisor and other employees on an installation is considered an employer within the meaning of the Act if the supervisor supervises the shift on behalf of the contractor. 

In many cases, a specific assessment is required to determine who carries out the function as employer within the meaning of the Offshore Safety Act, and this should be agreed on in the contract between the individual enterprises. In cases of doubt, the DWEA may assist the enterprises in clarifying the matter. 

In practice, there will be several employers at a production installation: the operator (as the enterprise responsible for operations) and contractors, e.g. the catering business responsible for supplying food and for cleaning, as well as the maintenance teams from onshore enterprises. When extra labour is needed, e.g. in connection with maintenance work, the operator will often hire in individuals from enterprises on shore, and the operator is thus the employer of these individuals, see above. 

At drilling rigs, the situation is different, as the owner usually only has a contract with a single contractor: the catering business. Furthermore, the operator will have entered into contracts with a number of contractors to perform special tasks in connection with the drilling operations. Consequently, several employers are usually onboard a drilling rig.

4.8. Offshore installation manager

”The supervisor who, on behalf of the operator and the owner, respectively, is in charge of the day-to-day operation of an installation.” (Section 3(1), no. 2 of the Offshore Safety Act.) 

An offshore installation manager is a supervisor as defined in the definition in section 4.9, and is at the same time responsible for the overall management of the installation on behalf of the operator or the owner. The offshore installation manager typically reports to superiors in the operator’s or the owner’s organisation on shore. The offshore installation manager’s subordinates will be several supervisors within different work areas. 

The offshore installation manager is also referred to by the abbreviation OIM or as a “platform manager”.

4.9. Supervisor

”Any person whose work consists solely or primarily of managing or supervising, on behalf of the employer, work in its enterprise or any part thereof.” (Section 3(1), no. 4 of the Offshore Safety Act.) 

A supervisor is an employee who solely or primarily supervises specific work on behalf of the employer. On installations, apart from the offshore installation manager, supervisors include operations superintendents, tool pushers, etc. Onshore, the supervisor may, for example, be the person to whom the offshore installation manager reports. As mentioned in the definition of enterprise manager, technical directors, finance directors and other senior executives not participating in the general overall management of the enterprise are also considered supervisors within the meaning of the Act.

4.10. Employee

The concept “employee” is not defined in the Offshore Safety Act, but it covers any person who receives instructions by an employer. “Employees” may also be referred to as “workers”.

4.11. Safety organisation

”The established collaboration between the operator and the owner, respectively, and representatives of the employees, referred to as safety representatives, cf. section 46(1) of the Offshore Safety Act.” (Executive Order no. 1198, section 2(1), no. 13.) 

The collaboration encompasses all employers and employees on the installation, including individuals on loan to the operator or the owner from an onshore enterprise and employees of a contractor working on the installation as an employer.

5. Definitions of concepts related to management of health and safety

5.1. Risk management

A number of concepts are associated with the rules concerning management of health and safety risks and risks of major environmental incidents. These concepts are described below.

The concept of ”risk” is overall defined as ”The combination of the probability of an event and the consequences of that event”. (Section 3(1), no. 24 of the Offshore Safety Act) As mentioned in section 1 concerning the main principles of the Offshore Safety Act, the fundamental principle of risk management is the ALARP principle: “As Low As Reasonably Practicable.

Following the ALARP principle means that risks shall be reduced to a level that is as low as reasonably practicable.” (Executive Order no. 1198, section 2(1), no. 6.) 

In connection with reducing risks according to the ALARP principle, the following concepts are applied: 

“Highest acceptable level of risk” means: “The highest level of risk at which operations may be performed.” (Executive Order no. 1198, section 2(1), no. 3). 

“Acceptance criterion” means: “Established quantitative limit for the highest acceptable level of risk.” (Executive Order no. 1198, section 2(1), no. 4). 

“Generally acceptable level of risk” means: “The level of risk at which additional use of the ALARP principle is unnecessary.” (Executive Order no. 1198, section 2(1), no. 5).

“Risk management” means: “The total process of risk assessment, identification of risk reduction measures, and implementation of such risk reduction measures pursuant to the ALARP principle.” (Executive Order no. 1198, section 2(1), no. 2.) 

“Other risks” means: “Risks linked to the performance of work, layout of workstations, access routes and escape routes on installations or connected infrastructure, and which are not major accident risks, cf. the definition hereof.” (Executive Order no. 1198, section 2(1), no. 9.) 

“Prevention” means: “All the steps or measures taken or planned at all stages of work to prevent or reduce health and safety risks.” (Executive Order no. 1198, section 2(1), no. 11.) 

The definition of a health and safety risk may be expanded as follows: 

“Risk of personal injury, illness or death measured as 

a) safety risk: combination (product) of the probability of an event and the consequence of that event; or 

b) health risk: combination (product) of the magnitude and duration of a harmful effect.” (Executive Order no. 1198, section 2(1), no. 1.) 

Safety risk may be expressed as follows:

  • Individual risk: Also known as “location-based risk”, is defined, according to DS/INF 85, as the risk to which an individual is exposed. Individual risk expresses the risk to which individuals are exposed during the period of time in which they perform offshore work (usually 14 days). Offshore work means work performed mainly on or from an installation or connected infrastructure, and directly or indirectly in connection with offshore oil and gas operations. To a lesser extent, the work may be performed on shore, see DWEA guideline 65.1.6 on working time regulations at offshore oil and gas operations. Risk is composed of the following risk contributions: the individual’s work and other activities on the installation, transport to and from the installation or between other installations, as well as any work performed on shore. Individual risk is often calculated for a group of individuals performing the same type of work or staying in the same risk area. Off-duty periods are not included in the calculation, whereas rest periods in connection with offshore work are included. Risk is expressed quantitatively as the probability of fatality during a given period of time. This risk may be expressed in several different ways. A frequently applied measure is the probability per annum, expressed as IR (Individual Risk) or IRPA (Individual Risk Per Annum). Another measure is FAR (Fatal Accident Rate), which expresses the number of fatalities among individuals performing the same type of work or staying in the same risk area, per 100 million exposure hours.

Examples of limits in the UK (Health & Safety Executive (2001): Reducing Risks, Protecting People (R2P2), and Ireland (Commission for Energy Regulation (2013): ALARP Guidance Document CER/13/282, ver. 2.0.) to individual risks involving industrial workers and the general public (there are no similar Danish publications):

 

 

Maximum tolerable risk (fatalities per year) 

Broadly acceptable risk (fatalities per year) 

Workers 

 10-3

 10-6

The public 

 10-4

 10-6

  • Collective risk: Also known as societal risk, expresses the risk that a group of individuals within a specifically defined area are simultaneously exposed to the consequences of an accident. Using an FN curve, for example, this is expressed as the relationship between the expected frequency of the accident, and the number of people who die (or are injured) as a result of the accident. ‘F’ is the (cumulative) frequency of an accident involving more than N fatalities. The result expresses the cumulative and simultaneous expected loss for society. The calculation of the FN curve takes into account the probability of a number of accident scenarios, and an assessment of how many workers might be exposed to consequences under these scenarios, based on the number of people present at the accident site, places of work, and local protection (e.g. whether they are indoors or outdoors).
  • Platform fatality risk: The risk is expressed quantitatively as the number of potential fatalities on the platform as a whole over a given period of time, usually a year, and is referred to as the PLL (Potential Loss of Life) or the FPPY (Fatalities Per Platform Year).

Health risk is the risk that a given exposure from an agent, either a physical agent (noise, vibrations, radiation), or a chemical or biological agent, or any other exposure (e.g. heavy lifting or physical exposures), causes illness or death. Illness resulting from work involving long-term exposures is termed as occupational diseases. The condition may be physical (somatic) or mental. 

The risk depends on the duration of the exposure and its intensity (dose), as well as the degree of danger in the case of an agent. Note that health risk is usually not linearly dependent on the relevant factors. Consequently, it will be necessary to search for information about the effect of the exposure at the relevant intensity, duration and degree of danger.

5.2. Major accident

“In relation to an installation, connected infrastructure or a pipeline 

a) an incident involving an explosion, fire, loss of well control, or release of oil, gas or dangerous substances or materials involving, or with a significant potential to cause, fatalities or serious personal injury, cf. also subsection (2), 

b) an incident leading to serious damage to the installation or connected infrastructure involving, or with a significant potential to cause, fatalities or serious personal injury, cf. also subsection (2), 

c) any other incident leading to fatalities or serious injury to five or more persons on the offshore installation where the source of danger occurs or engaged in an offshore oil and gas operation in connection with the installation or connected infrastructure, or 

d) any major environmental incident resulting from incidents referred to in points (a), (b) and (c), cf. also subsection (2).” (Section 3(1), no. 28 of the Offshore Safety Act.) 

Section 3(2) of the Offshore Safety Act states that points (a), (b) and (d) also apply to a non-permanently manned installation in situations where the installation is not manned. 

Satisfaction of any of the four criteria alone is sufficient for the incident to be considered as a major accident. 

Concerning point c: A total of five persons must either die or suffer serious personal injuries.

5.3. Serious personal injury

Serious personal injury means (Executive Order no. 1196, Annex 1):

  1. “Bone fracture, except for fracture of a single finger or toe.
  2. Loss of one or more body parts.
  3. Dislocation of shoulder, hip, knee or spine.
  4. Severe burns.
  5. Loss of vision, permanently or temporarily.
  6. Damage to one eye or both eyes through corrosive burns, burns from hot metal or penetration of an object.
  7. Electric shock or electric burns causing unconsciousness or requiring resuscitation.
  8. Hypothermia.
  9. Loss of consciousness.
  10. Personal injury otherwise resulting in acute taking ashore of injured persons.”

5.4. Accident

“An accident pursuant to section 6 of the Danish Workers’ Compensation Act.” (Executive Order no. 1196, section 2, no. 1.) 

In the Danish Workers’ Compensation Act, an accident is defined as follows: 

”An accident within the meaning of this Act shall be a personal injury caused by an incident or exposure that occurs suddenly or within five days.” 

“Personal injury” covers both physical and psychological injuries. An example of the occurrence of a psychological injury is when a person witnesses a serious accident. The concept of “personal injury” is not restricted to the definition of a serious personal injury. 

Incidents of poisoning mentioned in the Executive Order on Notification of Industrial Accidents pursuant to the Working Environment Act are not specifically mentioned in the Executive Order on Notification, as these are covered by the definition of accidents. Incidents of poisoning cause acute illness after short-term exposure through ingestion, inhalation, absorption or injection of a harmful substance or material. If the exposure is long-term, and thus does not involve acute illness, it is referred to as an occupational disease.

5.5. Occupational diseases

“Occupational diseases pursuant to section 7(1) of the Workers’ Compensation Act.” (Executive Order no. 1196, section 2, no. 2.) 

In section 7(1) of the Workers’ Compensation Act, an occupational disease is defined as follows: 

“1) Diseases which – according to medical documentation – are brought about by specific influence to which certain groups of people, through their work or working conditions, are more exposed than persons not having such work. Furthermore occupational diseases shall comprise such diseases as are contracted by a live-born child prior to its delivery as a consequence of its mother’s work during pregnancy. The Minister for Employment, upon the recommendation of the Occupational Diseases Committee, cf. section 9, shall compile a list of such diseases as are deemed to be of the said nature. 

2) Other diseases, including diseases in a live-born child contracted prior to its delivery, where it is established either that, on the basis of the most recent medical documentation, the disease meets the requirements set out in the first sentence of no. 1) of this section, or that it must be deemed to have been caused, solely or mainly, by the special nature of the work”. 

Occupational diseases also include diseases contracted due to exposure during time off on the installation or associated accommodation facilities outside the installation, e.g. accommodation platforms or ships. Thus, not only diseases contracted due to exposures in connection with work are included. Occupational diseases may cover both physical and psychological conditions.

5.6. Near miss

”An incident which could have led to an accident or injury of importance to health and safety at the installation.” (Executive Order no. 1196, section 2, no. 4.) 

Other expressions may be used for near misses, including “near miss events”, “adverse events” and “dangerous occurrences”.

5.7. Major environmental incident

”An incident which results, or is likely to result, in environmental damage covered by the Environmental Damage Act (“miljøskadeloven”).” (Section 3(1), no. 27 of the Offshore Safety Act.) 

With respect to the aquatic environment, the concept is defined in the Environmental Damage Act and covers all major environmental incidents, irrespective of their cause. 

However, in the Offshore Safety Act, the concept is only used in connection with the definition of “major accidents”, see above. Thus, the concept “risk of major environmental incidents”, applied several times in the Act, only includes major environmental incidents that have occurred in connection with major accidents.

5.8. Independent verification

“An assessment and confirmation of the validity of particular written statements by an enterprise or an organisational part of the operator or the owner that is not under the control of, or influenced by, the enterprise or the organisational part using those statements.” (Section 3(1), no. 30 of the Offshore Safety Act.) 

Independent verification does not imply that verification must be performed by an independent third party; it may be conducted within the internal organisational framework, provided that the independence and qualifications requirements laid down in the independent verification regulations of Executive Order no. 1198 are met. 

“Particular written statements” refers to documentation establishing the subject of assessments, e.g. requirements for equipment or substances and materials or procedures for use and maintenance.

5.9. Internal emergency response plan

”A plan prepared by the operator or owner pursuant to the provisions of this Act, or to regulations issued pursuant to this Act, concerning measures to prevent escalation or limit the consequences of accidents, cf. section 45, relating to offshore oil and gas operations.” (Section 3(1), no. 12 of the Offshore Safety Act.) 

The definition should be seen in the context of the definition below of an external emergency response plan. 

The definition covers all accidents, not only major accidents. An example of this is emergency response in connection with rescue of individuals who have fallen overboard. This definition should only be seen in the context of countering any consequences of accidents and hazardous situations on installations. Emergency response to prevent pollution by oil and chemicals in Danish waters is regulated by the Marine Environment Act.

5.10. External emergency response plan

”A local, national or regional strategy to prevent escalation or limit the consequences of a major accident relating to offshore oil and gas operations using all resources available to the operator as described in the relevant internal emergency response plan, and any supplementary resources made available by the authorities.” (Section 3(1), no. 7 of the Offshore Safety Act.) 

The definition should be seen in the context of the definition above of an internal emergency response plan. This definition should only be seen in the context of efforts by the authorities to counter any consequences of accidents and hazardous situations on installations. Emergency response on the part of the authorities to prevent pollution by oil and chemicals in Danish waters is regulated by the Marine Environment Act.

5.11. Personal protective equipment

“All equipment, including clothing, designed for use by employees to protect them against one or more risks that may constitute a threat to the health and safety of the person in question during work as well as any appurtenance that serves this purpose.” (Executive Order no. 1343, section 2.) 

Survival suits are also considered personal protective equipment and are therefore covered by Executive Order no. 1343.