Brussels, 08/10/2010 (Agence Europe) - Despite the reservations of some member states and the European Parliament, European Energy Commissioner Günther Oettinger is likely next week, to argue for a moratorium on deep water oil drilling, while awaiting the exact causes of the explosion in April on board the BP oil platform Deepwater Horizon in the Gulf of Mexico which resulted in the United States' worst oil spillage. On 13 October, the commissioner will present a communication on safety challenges in gas and oil exploration which will set out the changes needed to current Community legislation and also non-legislative measures to be taken with national regulatory authorities and the industry.
The awaited document will be based on the work launched in May by Oettinger, who has twice held meetings - in May and July - with the industry and national regulatory authorities to take stock of risks and liabilities, respect for European standards, technology currently available and regulations both currently in place or needed.
The commissioner is likely to say that there is too much fragmentation in the rules on offshore drilling to be able to deal properly with the risks in an industry which is seeing itself forced, because of rarity of easily accessible hydrocarbons, to undertake drilling further and further from shore and at ever greater depths.
In view of the expansion in the number of offshore installations - over 1,000 in the north-east Atlantic and more than 100 in the Mediterranean, where new drilling is planned off Cyprus and Malta, the European Commission is expected to propose putting in place a system which sets out liability unequivocally, in support of the licensing scheme which ensures the safety of new drilling in difficult and complex environments.
The Commission is likely, too, to propose that, during the authorisation process, oil companies have to prove the safety case for each operation and demonstrate their ability to prevent and manage crises. It is likely also to propose that companies have to prove that they are able financially to bear the consequences of unexpected incidents, possibly by means of insurance policies and risk cover instruments. The Commission is likely, finally, to propose that drilling ships should be subject to the same rules as platforms. At the start of July, Oettinger clearly stated his wish for oil-spill insurance which oil companies should take out to meet the costs of potential environmental disasters. He was thinking at the time of an overall civil liability system, similar to the one that operates for nuclear power stations, which have to have financial reserves to deal with accidents that may occur.
However, though there is general agreement on the need to re-assess Community rules on safety and liability in the event of an oil spillage, Oettinger's idea of a temporary suspension of offshore drilling has raised far greater controversy. EU member states will air the issue as a whole when European energy ministers meet in Luxembourg on 15 October. Italian Energy Minister Stefania Prestigiacomo said at the start of August that Italy supported the commissioner's call; the United Kingdom firmly opposes it. Despite a recent report on safety on board BP platforms in the North Sea, the UK strongly defends its regulatory regime for oil and gas exploration and claims that it examines each and every drilling programme in British waters individually.
Going against the position adopted by its environment committee at the end of September, the European Parliament, in plenary session on 7 October, voted against temporary suspension of deep water drilling. Although they backed a resolution by 601 votes to 23, with 13 abstentions demanding tougher safety criteria for oil platforms in Europe, MEPs rejected the call for a moratorium on any new offshore oil and gas exploration.
Following the vote, Corinne Lepage (ALDE, France, deputy chairwoman of the environment committee and chair of the seas and coastal regions intergroup regretted the “ambiguous message” sent by the EP to the Commission. “On the one hand, we note that there are severe deficiencies in European legislation and we call on the Commission to complete and strengthen it. But we fail to take the next logical step, which would be to call for a moratorium on the deepest drilling,” she says in a press release. “I note that Commissioner Oettinger, who no longer speaks of the moratorium, and also a goodly number of MEPs have suddenly changed their opinion on this issue, showing the power of the oil industry. Yet the idea of a moratorium was not to stop existing drilling, but to suspend temporarily the granting of new licences for this kind of drilling, until such time as we have made our legislation completely safe. We are not safe from a major accident,” Lepage added. (E.H./transl.rt)