Chemicals – Production

Key Legislation:

For more detail on the Legislation relevant to this page, please use the following links:

Supporting Legislation:
Guidance:

These guidelines have been provided by the Oil and Gas Authority to outline the information requirements for an operatorship application to aid companies become production operators in the UKCS

Consent Needed: A chemical permit under the Offshore Chemical Regulations 2002 (OCR 2002) is required for all production chemicals. All operational chemicals must be included in this permit, including:

  • Chemicals used in the production of hydrocarbons
  • Water injection chemicals
  • Squeeze chemicals
  • Corrosion inhibitors and biocides
  • Chemicals used in semi-closed systems where there may be some discharge to sea e.g. hydraulic fluids in subsea control systems and corrosion inhibitors used within fire fighting drench systems, where applicable
  • Chemicals generated in-situ e.g. hypochlorite
  • Rig and turbine washes

Chemicals used/discharged from workovers on platforms may also be included in the production operation permit. Alternatively a well intervention operation permit may be used (see Workovers).

Drilling chemicals either for drilling from the platform or chemicals introduced by a tieback from a MODU should be covered in the drilling operation permit (see Drilling Chemicals).

A number of chemicals are exempt from OCR 2002 (see the Performance Standards tab). Guidance on OCR 2002 is available from the Government website (see the Guidance Notes in the Legislation tab).

What to Include in Permit Authorisation: An application for the grant of a permit from BEIS under regulation 4 is made in writing or by an electronic means of communication acceptable to the Secretary of State (Production Operation Permit). It shall contain:

  • A description of the offshore source on or from which the offshore chemical is to be used or discharged, and the location of the offshore source in the relevant area
  • A description of the proposed technology and other techniques for preventing or, where this is not possible, reducing the use or discharge of the offshore chemical from the offshore source
  • A description of the measures planned to monitor the use or discharge of the offshore chemical
  • An assessment of the risk of damage to the environment from the use and discharge of the offshore chemicals proposed.

The regulations allow for the acquisition of further information if that submitted is deemed insufficient or incorrect and for the gathering of evidence to verify any statements made.

How to Apply: Applications should be made using the PETS system via a production operation application. PETS applications must be submitted to BEIS via the UK Oil Portal. Any variations must be submitted in the same way. Operators will need to be registered with BEIS for access to the Portal. To set up a UK Oil Portal Account, contact the BEIS OED Environmental Management Team at ukop@decc.gsi.gov.uk. If you encounter an problems with PETS submission, you should contact the BEIS OED EMT by email at emt@decc.gsi.gov.uk
Who to Apply to: Application to BEIS, Oil and Gas Office, Aberdeen, via UK Oil Portal.
When to Apply: A period of at least 3 months should be allowed for submission and approval of a first production operation application as a period of public consultation of at least 28 days is included in the approval process. There will be a requirement for public notification for the initial platform permit, where a variation has been refused or where BEIS directs that publication should occur at the time of a permit review. In all other cases, there will be no public consultation requirement. Publication of the notice will be in the same newspapers that would be used for Environmental Statement notification. The notice will say from where a copy of the application may be obtained (i.e. from the applicant) and an address from where a copy of the application may be obtained (i.e. the address of the applicant). The period of public notice will be at least 28 days. Applications for variations to permits do not require a period of public notice, but a lead time of at least 28 days should be allowed.
Permit Duration: A permit will usually be issued for the life of the field but will be subject to annual review.
Requirements of the Regulations:

Operators will need to assess the risks to the environment, which might arise from their particular chemicals use and discharge. For some chemicals e.g. those on the OSPAR PLONOR list, assessment will be straightforward. Most, however, will require a formal process of risk assessment, such as can be done using CHARM software. In this process, the predicted environmental concentration (PEC), determined from a knowledge of individual substance or product chemistry and the conditions of use, is compared with the Predicted No-effect Concentration (PNEC) determined from toxicity tests conducted to agreed protocols. This allows more informed assessments of risk to local sensitivities to be made in particular use and/or discharge scenarios. The use of the CHARM model is compulsory for calculating the Hazard Quotient (HQ) but other risk assessment models may be used to calculate the Risk Quotient (RQ) provided comparability with CHARM can be demonstrated.

Controls Placed on the Type and Volume of Production Chemicals Discharged: Conditions of an approved permit will indicate the types and volumes of chemicals that may be discharged into the environment.
Exempt Chemicals: The OCR 2002 regulations are not intended to apply to chemicals that might otherwise be used on a ship, helicopter or other offshore structure. This effectively exempts, for example, products used solely within accommodation areas, additives to potable water systems, paints and other coatings, fuels, lubricants, fire-fighting foams, hydraulic fluids used in cranes and other machinery, etc.
UK National Plan for the phase-out of substances identified as candidates for substitution – in line with OSPAR Recommendation 2006/3:(The full text of the current UK National Plan for phase out can be found on the CEFAS website) OSPAR Recommendation 2006/3 requires that as soon as is practicable and no later than 1 January 2017, Contracting Parties to OSPAR should have phased out the discharge of offshore chemicals that are, or which contain substances, identified as candidates for substitution except for those chemicals where despite considerable efforts, it can be demonstrated that this is not feasible due to technical or safety reasons. Demonstration of those reasons should include a description of those efforts.Having considered the requirements of OSPAR Recommendation 2006/3, the UK has decided to base its National Plan for the prioritisation of phase-out on the following criteria:

  • Perceived difficulty of phase out
  • Securing the replacement of candidates for substitution in preference to eliminating operational discharges to the marine environment
  • Prioritisation based on the persistence, bioaccumulation and toxicological properties of the chemical

The UK National Plan also incorporates justification of continued use and/or discharge as an additional element. For substances where replacement and/or eliminating discharges to the marine environment is not currently feasible, offshore operators or their chemical suppliers will annually be required to:

  • Confirm the efforts made to phase out the use and/or discharge of the candidates for substitution
  • Confirm the nature and timing of planned research and development studies or trials to supplement those efforts conform whether any measures have been taken to reduce the use and/or discharge of the candidate for substitution
  • Confirm the technical and/or safety issues that make it necessary to continue use and/or discharge of the candidate for substitution

UK National Plan level criteria and interim target dates are (See the full text of the UK National Plan (PDF document) on the CEFAS website for definitions of persistence, bioaccumulating and toxicity):

  • Level 1 (highest priority)
    • Organic substances that are highly persistent, bioaccumulating and toxic
    • Chemicals to be replaced; or discharges to the marine environment to be eliminated or continued use and/or discharge to be formally justified by end December 2010.
  • Level 2
    • Moderately persistent, bioaccumulating and toxic, or
    • Highly persistent and bioaccumulating, or
    • Highly persistent and toxic chemicals
    • To be replaced, or discharges to the marine environment eliminated, or continued use and/or discharge to be formally justified by end December 2012.
  • Level 3
    • Moderately persistent and bioaccumulating, or
    • Moderately persistent and toxic, or
    • Bioaccumulating and toxic chemicals
    • To be replaced, or discharges to the marine environment eliminated and/or discharge formally justified by end December 2014.
  • Level 4 (lowest priority)
    • Highly persistent organic substances, or
    • Inorganic substances with toxicity <1mg/l
    • Chemicals to be replaced, or discharges to the marine environment eliminated, or continued use and/or discharge to be formally justified by end December 2016.
EC Regulation 1907/2006 (REACH): REACH deals with the Registration, Evaluation, Authorisation and Restriction of Chemical substances. The aim of REACH is to improve the protection of human health and the environment through the better and earlier identification of the intrinsic properties of chemical substances. At the same time, innovative capability and competitiveness of the EU chemicals industry should be enhanced.The benefits of the REACH system will come gradually, as more and more substances are phased into REACH. The HSE is the UK Competent Authority for REACH and is working closely with Defra plus other Government departments and Agencies on the policy/enforcement aspects. HSE enforces maritime Health and Safety Regulations which apply to offshore installations. To ensure a consistent regime, the offshore enforcement of REACH will be carried out by those who are familiar with enforcement requirements in similar circumstances to that required by REACH. Therefore, HSE and BEIS will enforce offshore the aspects of REACH relating to health/safety and environmental protection – using their respective onshore administrative procedures and offshore inspectors to check compliance with the relevant provisions. In this regard, BEIS sits on the REACH Enforcement Liaison Group (established by the HSE) to ensure that a proportionate and consistent method of enforcement is adopted. From an offshore environmental protection perspective, the OSPAR HMCS and REACH requirements will run in parallel, with the HMCS approach to controlling offshore chemicals being appropriately harmonised with the provisions of the EU Regulation. Accordingly, the UK REACH Enforcement Regulations contain certain provisions from, and makes references to, the OCR, so effectively OCR (and hence the HMCS) will be the mechanism for supporting the application of the environmental protection elements of REACH to offshore installations. It should, however, be noted that BEIS’s regulatory regime for offshore chemicals does not extend to Scottish controlled waters and therefore, insofar as this area is concerned, REACH will be enforced by an authorised body (i.e. SEPA) on behalf of the Scottish Executive.REACH provisions will be phased-in over 11 years. Appendix 1 of the Guidance Notes on Reach addresses Specific REACH issues pertaining to the offshore sector. A Timetable of REACH Implementation (pdf document) is available.
Routine Monitoring: Routine monitoring of process streams and of the area around installations may be requested to confirm impact hypotheses and to check that the general health of the marine environment near platforms remains acceptably high. The operator will carry out such monitoring and bear the cost.
Check Monitoring (Inspections): The Regulator will undertake check monitoring. It will seek to confirm that routine monitoring is generating accurate returns. The costs of this monitoring will be recovered under the general fees charged for the scheme. Inspectors appointed under the Regulations may board any offshore installation at any reasonable time, or if significant pollution is suspected, at any time.Where an inspector considers that any activity in relation to the use or discharge of an offshore chemical involves a serious and imminent risk of pollution, he may give such directions in relation to that activity (including a direction requiring the cessation of that activity), as he considers necessary to avoid or minimise the risk of pollution in question.
What to Report: Chemical Use and Discharge  Reports are made on the production chemicals spreadsheet available for download on the EEMS website. Reports need to cover:

  • The name and actual quantity of each chemical used
  • The volumes of each chemical discharged into the marine environment.

As well as being used by BEIS to check actual use and discharge of chemicals against the term permit, they will also be used towards the compilation of the OSPAR returns which Contracting Parties are obliged to make.

For certain problematic substances, such as those identified for substitution, the Department may require more frequent reporting. A condition in the permit will make this clear if necessary.

Annual Progress Reports on Substitution Chemicals

Annual reports are also required by BEIS on progress made to replace and/or phase out chemicals included on the OSPAR List of Chemicals for Priority Action or have been identified as Candidates for Substitution.

A reporting template can be downloaded from the BEIS website (Excel document). Reporting includes summary of chemicals replaced, summary of chemicals still to be replaced and justification for continued use and/or discharge.

In addition to completing the spreadsheet, operators are also required to submit a Technical Justification Report for the continued use and/or discharge of all chemicals identified as Chemicals for Priority Action or Candidates for Substitution. This guidance document explains the completion of reporting spreadsheets. Some minor modifications have been made to the Annual Reporting spreadsheets and the Technical Justification Report (TJR) spreadsheet since the 2014 version.

Who to Report to: Chemical Use and Discharge  Reports need to be made electronically on the EEMS website after each well. BEIS will use EEMS reports to cross check against permit conditions to ensure compliance.

Annual Progress Reports on Substitution Chemicals

Reports need to be submitted to BEIS Environmental Management Team by email to emt@decc.gsi.gov.uk

When to Report: EEMS reports are to be submitted 28 days after the end of each quarter reporting use/discharge of chemicals in that quarter.Annual Progress Reports – end of February for the preceding calendar year.
Non Compliance: OCR Non-Compliance Notification Form (Word document) is to be used for reporting any identified non-compliances against Chemical Permit conditions issued under the provisions of the Offshore Chemical Regulations 2002.Examples of these may include, but are not limited to:

  • Identified overuse of chemicals or use and/or discharge of chemicals not included on the permit.

In addition the form may be used to notify BEIS of any other applicable notifications specifically, as required by the chemical permit conditions.

Variations to chemical permits should be made before exceeding permit limits. Emergency approval of chemical use and/or discharge can be obtained out of normal office hours by contacting the BEIS Duty Officer – ask to be connected to the On-Call Response Office (Offshore Environmental Inspectorate). Guidance on emergency approval can be found in the Guidance Notes of the Legislation tab.

If a variation is not in place before the unpermitted use or discharge occurs, a non-compliance notification form should be submitted. It is an offence not to submit a non-compliance report if required.

Chemical spill:  Any accidental spill of chemicals must be reported to BEIS using a PON1 (see Chemical Spills for additional details).
Inspections: At any reasonable time (or in a situation which in his opinion may give rise to a risk of significant pollution to the environment as a result of the use or discharge from an offshore source of an offshore chemical, at any time) the inspector may board any offshore installation to undertake inspections and investigations. The Offshore Oil and Gas Environment Unit Enforcement Policy sets out the general principles that Inspectors shall follow in relation to enforcement including prosecution.
Enforcement and prohibition notices: BEIS, if of the opinion that the OCR 2002 Regulations have been contravened, may issue an enforcement notice. This will specify the matters that constitute or are likely to constitute a contravention, steps required to rectify the matter and the time period within which these steps must be undertaken. If an enforcement notice is not addressed, BEIS may take action itself and recover reasonable costs back from the operator. If BEIS is of the opinion that the operation of an offshore installation involves an imminent risk of serious pollution as a consequence of any discharge of chemical, BEIS may serve a prohibition notice. This will specify the pollution risk, the steps required to remove it and the time period, and may withdraw a permit wholly or in part until the prohibition notice is withdrawn.
False or Misleading Information: BEIS may by notice revoke a permit granted where they are of the opinion that the application for the permit in question contained any information or statement which was false or misleading in a material particular or where the operator in question has been guilty of a breach of any condition attached to the permit.
Offences: A person is guilty of an offence if he:

  • Uses or discharges any offshore chemical in the relevant area without a permit
  • Uses or discharges any offshore chemical in breach of the terms of any condition attached to any permit
  • Is seen by an inspector to use or discharge of an offshore chemical that involves a serious and imminent risk of pollution
  • Fails to supply any information required to be supplied by virtue of the terms of any permit granted under these Regulations
  • Knowingly or recklessly makes a statement which he knows to be false or misleading in a material particular where such a statement:
    • Is made in connection with or for the purposes of, any application for a permit, the renewal of a permit or the variation of a permit, or
    • Is made for the purposes of satisfying any requirement under these Regulations for the supply of information to the Secretary of State or an inspector appointed pursuant to regulation 16
  • Willfully obstructs an inspector, or
  • Without reasonable excuse fails to comply with an obligation imposed in pursuance of the regulations or prevents another person from complying with such a requirement.

 

 

Production Permit Reviews and Renewal: Permits will be valid for the field life but must be reviewed and renewed on an annual basis. Chemical allowances can be requested up to two years in advance with the provision of forecast production data. An application for renewal of a permit must be made in writing or by means of electronic communication before, but no more than three months before, the expiry of the permit in question. Renewals are submitted electronically on BEIS UK Oil Portal from where they are reviewed and electronically approved. Draft guidance on production permits in the new PETS system is available on the here (PDF document).
Apply for Variations to Existing Permits: Applications need to be made to BEIS for a variation in the terms and conditions of a permit. This would involve any change in the use and discharge of chemicals. All applications need to be considered by BEIS and MS (CEFAS when in England and Wales).Where BEIS determines that a variation applied for by an operator would not be a significant change, he may grant the application and vary the terms and conditions of the permit accordingly, provided he has consulted the appropriate consultation bodies. Where BEIS determines that the change would be a significant change they will refuse the application and serve a notice in writing on the applicant. Variations will be dealt with by BEIS as quickly as possible, but 28 days should be allowed for the assessment of any significant changes.
Emergency Variation: Permit holders applying for an emergency variation should telephone the BEIS out of hours contact. These details will be passed to the BEIS on-call Environmental Inspector who will contact the permit holder to further discuss the emergency variation request.Following a review of the chemical permitting procedures, BEIS now require that all emergency chemical variation requests are made in writing following the initial contact telephone call. The BEIS on-call Environmental Inspector will email a data request by email, with completed questions returned by email. Following a review of the request a written response granting or approving the variation will be sent by return of email. The applicant must subsequently formally vary the production operation permit within 2 working days of the emergency contact.For more information see Environmental Alert 004/2009 (PDF document).
Update or Variation: Update – change to PETS permit made after the application but before approval has been given.Variation – change to PETS permit made after approval has been given.Application for a variation or update should be made by clearly amending the previously submitted production operation permit via the BEIS portal.
What Would Constitute a Revision of Conditions: BEIS will review and revise the conditions of a permit where in its opinion the pollution or risk of pollution caused by the use or discharge of an offshore chemical is of such significance that any existing restrictions on the quantity, frequency or location of the use or discharge of such offshore chemical contained in a permit need to be revised or new restrictions on the quantity, frequency or location need to be included in the permit.
Field Trials for New Chemicals: It is likely that field trials involving the use and discharge of new chemicals can be encompassed through a request for a variation to an existing permit since a field trial will have been planned. If there is any doubt about how this should be handled, then the operator and the chemical company are strongly advised to discuss the proposed field trial with BEIS, Aberdeen and Marine Scotland or CEFAS (as appropriate) first.
Surrendering a Permit: An operator may by notice surrender a permit granted to him.
Proposals for an Integrated Framework of Environmental Regulation: The proposals outlined by SEPA will deliver a simpler legislative framework which will enable SEPA to focus greater effort on the environmental problems that matter most. It will provide a more consistent range of enforcement tools so that proportionate and effective action can be taken against those who would damage the environment. The consultation that has been undertaken is built on previous consultations focusing on changes to the structure of environmental protection legislation in order to create a new, integrated framework for the permissions (licences, permits, rules, etc.) which will be used to control activities which could harm the environment.
Copper Anti-fouling Systems under Biocidal Products Directive:

A new legal requirement came into force under the EU Biocidal Products Directive 98/8/EC, prohibiting the supply and use of copper as a biocide when used in liquid-cooling and processing systems.
Copper is used offshore in a number of systems, e.g. sea water lift, fire water systems, injection systems, ballast systems and engine cooling HVAC cooling.
Although not an exhaustive list, oil and gas operators should check all systems/vessels/installations using copper anti-fouling systems, or when used as a biocide in liquid-cooling and processing systems.

Further details are available from Anti-Fouling Systems page.

Environmental Alert (001/2014) – PON1 Reporting: Issued by DECC (now BEIS) on 31 March 2014, this environmental alert (PDF document) highlights failures by a number of operators to comply with PON1 reporting requirements. Operators are reminded that in accordance with current reporting requirements, PON1s must be reported within 6 hours to:

  • Aberdeen Maritime Rescue Coordination Centre (MRCC) in addition to immediate telephone notification to the nearest MRCC Coastguard Station.
  • BEIS; additional telephone notification is required to the Department for specific scenarios as detailed within the PON1 reporting guidance.
  • Joint Nature Conservation Committee (JNCC) and any relevant Statutory Nature Conservation Body (SNCB) in accordance with installation oil pollution emergency plan arrangements.

The Department of Business, Energy and Industrial Strategy (BEIS) regularly issues environmental alert notices in order to raise awareness of any environmental issues on the United Kingdom Continental Shelf (UKCS) so companies can respond appropriately. They are issued directly to Oil and Gas operators and published here.

Guidance on Biocide legislation – Getting on the list of active substance suppliers:

The European Chemicals Agency (ECHA) provides a useful guide on biocides legislation.

If chemical suppliers want to stay on the market with a biocidal product after 1 September 2015 they will need to get on the list of active substance suppliers (Article 95 of the Biocidal Products Regulation). ECHA provides a step by step guide on how to get on this list.

OGA Enhanced Oil Recovery (EOR) Strategy The OGA has published its EOR Strategy which will play a role in maximising economic recovery of the UKCS.

Further details are available here.

OGA to update the Petroleum Production Reporting System (PPRS)

In Q2 2017 the OGA will update the PPRS by adding it to the Energy Portal, replacing the current PPRS 2000 system which collects monthly hydrocarbon production data from oil fields and terminal in the UK.

Oil and Gas Authority (OGA) exploration strategy The OGA has published an exploration strategy which outlines the key strategies which will be used to underpin maximum economic recovery of the UKCS.