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What government approvals are needed for an offshore petroleum activity to begin?
Before any offshore petroleum activity can begin in Commonwealth waters a number of government approvals must be gained.
Firstly, the company proposing the activity must obtain an offshore petroleum title which secures rights to undertake petroleum activities in the title area. Relevant state and federal ministers (called the Joint Authority) and the National Offshore Petroleum Titles Administrator (NOPTA) grant titles. NOPTA also manages the day-to-day administration of titles. NOPSEMA has no role in the granting or administration of offshore petroleum titles.
While the granting of a title provides a company with rights to undertake petroleum activities in the title area, NOPSEMA’s role is to ensure the activity does not begin until the company proposing it can demonstrate that it will be undertaken in accordance with the law and in a manner that protects the offshore workforce and environment.
Approval to begin an offshore petroleum activity is only granted after NOPSEMA has conducted a thorough and rigorous technical assessment of the relevant risk management plans and has determined the plans meet all the requirements of the law. Risk management plans may include a safety case, well operations management plan, offshore project proposal and environment plan.
For an overview of the offshore petroleum regulatory process see Introducing NOPSEMA brochure (PDF 444KB) and Brochure - Offshore petroleum environmental approvals - November 2018 (PDF 226KB).
When will NOPSEMA make a decision to either accept or refuse to accept an environment plan? What does it mean if NOPSEMA provides an opportunity to modify and resubmit a plan or requests further written information?
During the assessment of an environment plan NOPSEMA may make a number of assessment decisions before it makes a final decision to either accept or refuse to accept an environment plan.
If NOPSEMA requires clarification on information in the environment plan, or more information on a particular aspect, then NOPSEMA will make a decision to REQUEST FURTHER WRITTEN INFORMATION from the titleholder.
NOPSEMA will make a decision to provide a titleholder an OPPORTUNITY TO MODIFY AND RESUBMIT the environment plan if it determines the plan is yet to meet regulatory requirements for acceptance. In fact, NOPSEMA is required by law to provide a titleholder a reasonable opportunity to modify their environment plan before making a final decision to either accept of refuse to accept. NOPSEMA will typically offer two opportunities to modify and resubmit; however, NOPSEMA is not restricted to only offering two such opportunities.
NOPSEMA will make a final decision to REFUSE TO ACCEPT an environment plan when it has provided the titleholder a reasonable opportunity to modify and resubmit the plan but determines that the plan still does not meet the regulatory requirements for acceptance. When NOPSEMA refuses to accept an environment plan it is not a rejection of the type of activity proposed, rather it is a rejection of the titleholder’s proposed environmental management for that activity. An activity may not begin without an accepted environment plan in place, therefore a titleholder must prepare and submit a new environment plan and begin the assessment process again.
Since NOPSEMA was established on 1 January 2012, 4% of all environment plans submitted for assessment have been refused.
If NOPSEMA determines an environment plan has met all regulatory requirements for acceptance then by law NOPSEMA is required to make a final decision to ACCEPT the plan. If NOPSEMA accepts an environment plan the proposed offshore petroleum activity is approved to begin. Once the activity begins, it will be subject to inspection by NOPSEMA to ensure it is undertaken in accordance with the accepted plan and the requirements of the law and NOPSEMA may take enforcement action if any non-compliance is found.
For an overview of the assessment process for environment plans see Flowchart - Assessment process for environment plans - April 2016 (PDF 92KB).
How long does an environment plan assessment take?
The law allows NOPSEMA to take as much time as required to ensure a professional and rigorous assessment can be undertaken. Less than 10 per cent of plans are accepted by NOPSEMA on first submission. Plans that are not accepted on first submission can be modified by the titleholder and resubmitted to NOPSEMA for further assessment.
Under the statutory assessment timeframes in the Environment Regulations, NOPSEMA has 30 days from the date of submission to determine whether it meets the criteria for acceptance in the Environment Regulations. After reviewing the plan and its complexity, NOPSEMA may determine that extra time is needed to complete its assessment. If this is the case, NOPSEMA will extend the timeframe at its discretion to ensure that there is enough time to complete a comprehensive assessment.
If NOPSEMA decides to give the titleholder an opportunity to modify and resubmit, the titleholder is given a specified amount of time based on an estimate of the time that it may take for the titleholder to address the points raised (often in the order of 4-8 weeks). The titleholder can also request for an extension of time to complete this work should it require additional time.
Where an environment plan is resubmitted, NOPSEMA then undertakes a further assessment on the revised environment plan.
NOPSEMA publishes average assessment timeframes for environment plans according to the proposed activity types each quarter. See the Median environment plan assessment timeframe page.
Are NOPSEMA’s assessment decisions subject to ministerial oversight?
The Australian Government created NOPSEMA as an independent regulator to ensure that decisions to accept or refuse risk management plans for safety, well integrity and environment focus exclusively on the technical and scientific merits of the proposal. These decisions are made independently of economic, commercial and political factors and the workings of government.
Therefore, neither the Resources Minister nor the Environment Minister has direct involvement in NOPSEMA’s regulatory decision making process for offshore petroleum activities. As the independent regulator, NOPSEMA is not involved in government policy decisions on whether fossil fuels should be exploited, or where exploration and production should take place.
As a government entity NOPSEMA must fulfil its obligations under the Public Governance Performance and Accountability Act 2013 (Cth) (PGPA Act). This includes regular reporting to the responsible Minister and the Finance Minister. This arrangement is designed to ensure oversight of the governance arrangements are visible to the Commonwealth. NOPSEMA regularly reports information and relevant documents to the ministers, including information on current activities and proposed changes to the organisation.
NOPSEMA has an independent Advisory Board that provides advice and makes recommendations to the Commonwealth Minister, State and Northern Territory Ministers and the COAG Energy Council on the performance by NOPSEMA of its functions and policy and strategic matters. The NOPSEMA Board also gives advice and recommendations to the Chief Executive Officer (CEO) of NOPSEMA about policies and strategies implemented by NOPSEMA in the performance of its functions.
NOPSEMA’s environmental management authorisation process has been endorsed by the Federal Minister for the Environment as a Program (the Program) that meets the requirements of the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act). NOPSEMA reports on its environmental management performance in accordance with administrative arrangements under the endorsed EPBC Act Program and is subject to reviews of its performance.
Does NOPSEMA have the expertise to assess environment plans for offshore petroleum activities in environmentally sensitive areas?
NOPSEMA relies on scientific evidence and a team of highly qualified experts to ensure high quality decision making and high quality advice to industry and other stakeholders.
NOPSEMA’s Environment Division is staffed by personnel with extensive experience in environmental sciences and offshore oil and gas (over half of this number hold PhD’s or Masters degrees).
Environment specialists generally have a range of previous experience related to environmental disciplines such as marine research, baseline studies, monitoring and modelling; environment impact assessments; preparation of environmental policy guidance related to marine parks, water quality, protected species, conservation and recovery plans; and environmental management systems. NOPSEMA also has a team of dedicated experts with backgrounds in oil spill and emergency response arrangements who have experience within the Australian and international context.
The information that NOPSEMA uses to support assessment decisions comes from a variety of sources, both national and international, including peer-reviewed published scientific literature, industry publications, published government management planning documents and species advice and information sought through relevant forums and conferences. The authors of this information range from university academics, scientific and industry experts and government departments and agencies such as CSIRO and the Australian Institute of Marine Science (AIMS). If a situation arose where NOPSEMA’s technical staff were unable to assess scientific information provided in a submission due to the technical nature of the information provided, NOPSEMA is able to seek advice from external scientific experts.
Does NOPSEMA take into account the performance history of oil and gas companies when assessing environment plans?
The performance history of oil and gas companies is taken into account through the acreage release and title grant process administered by the National Offshore Petroleum Titles Administrator (NOPTA).
NOPSEMA is not involved in making decisions on which oil and gas companies should be allowed to operate in Australia, only on how they operate.
NOPSEMA’s decisions focus exclusively on the technical and scientific merits of environment plans. During an assessment, NOPSEMA will consider the compliance record of the titleholder where it relates to matters considered in the environment plan.
How can I stay informed of the status and any decisions made by NOPSEMA regarding the assessment of an environment plan?
Stakeholders may subscribe to be notified by email of any changes to NOPSEMA’s assessment of an environment plan on the Activity status and summaries page.
On this page, NOPSEMA publishes information regarding the status of environment plan submissions and decisions in order to keep stakeholders up-to-date on the assessment processes.
Details of the proposed offshore petroleum or greenhouse gas activity and its location are published on submission to NOPSEMA. From 1 January 2016, NOPSEMA began publishing expected assessment timeframes and decision notices. If an environment plan is accepted, a summary of that plan is also published.
I’ve seen some concerning oil spill modelling in the media; can an oil spill really affect such a large area?
The oil spill images often used in media reporting are produced from is what is called ‘stochastic’ or ‘probabilistic’ oil spill modelling. The images generated show areas that are many times larger than what would actually be affected in the event of a real spill and are not an accurate picture of what an individual oil spill would look like.
The images are generated by overlaying a large number (often hundreds) of computer-simulated oil spills, each starting at a particular location, under different sets of wind and weather conditions. The models also assume that nothing is done to control the spill or to capture spilt oil. Stochastic oil spill modelling is a good tool for understanding oil spill variability and planning to respond to an oil spill because it shows where oil may go under a large number of different conditions.
NOPSEMA has recently published an animation on oil spill modelling. You can view the animation here.
What are the environmental requirements for chemical use and discharge?
Under the Offshore Petroleum and Greenhouse Gas Storage (Environment) Regulations 2009, an environment plan must describe the proposed petroleum activity and its operational details, describe the relevant environmental features of the activity’s location, undertake an assessment of all the potential environmental impacts and risks of the activity, and provide appropriate controls and mitigations to reduce those risks to as low as reasonably practicable (ALARP). It is through this process that a company will provide NOPSEMA with a risk-based justification for their chemical selection processes and discharge proposals.
To be accepted, the environment plan must demonstrate that the environmental risks associated with the intended use of chemicals is ALARP. For further information on how to a company may provide this demonstration within environment plan, see NOPSEMA’s Environment plan content requirements guidance note (GN1344).
NOPSEMA is frequently contacted by suppliers regarding regulatory pre-approvals of drilling fluids, mud additives, oily water separation additives and treatment equipment. NOPSEMA does not provide approvals for specific products or treatment equipment outside the context of an accepted environment plan. The proposed use of a product and its subsequent treatment and disposal must be described within an environment plan and demonstrated to minimise impacts and risks to the environment to ALARP. This demonstration is assessed in the context of the proposed petroleum activity.
Please note that the above information is relevant to regulation under the Offshore Petroleum and Greenhouse Gas Storage (Environment) Regulations 2009 and doesn't provide guidance in relation to other regulatory requirements in Australia such as product registration and chemical import requirements.
Does NOPSEMA endorse consultants, suppliers and service providers?
As NOPSEMA is the independent regulator within a performance-based regime, the authority takes care not to prescribe or endorse any particular technical solution or standard for adoption by the offshore petroleum industry. It would therefore be inappropriate and of limited value for NOPSEMA to meet with consultants, suppliers and service providers who may be seeking any form of endorsement of products or services.
As an alternative, opportunities are available to raise awareness of new products and services within the petroleum industry through direct engagement with oil and gas companies or through industry associations, such as the Australian Petroleum Production and Exploration Association (APPEA).
NOPSEMA’s specialist teams seek to continually improve their knowledge base, for example by attending industry conferences and seminars to remain up to date with advancements in oil field technologies. NOPSEMA welcomes any new information regarding solutions for health, safety and environment relevant to the offshore petroleum industry. Emails regarding new products and services available in Australia can be provided to email@example.com and will be distributed to the relevant specialist team/s for their information.