Well Examination Scheme - Issue 4

Offshore Major Accident Regulator

The Offshore Well Examination Scheme Inspection Guide Open Government Status Fully Open Publication Date 01/10/2017 Review Date 08/07/2027

Review History Date Changes

01/10/20 First three-year review conducted. Transferred inspection guide onto new inspection guide template. Minor updates made. 24/02/22 Second review conducted. Minor updates made. 08/07/2024 Third review conducted. Minor updates made.

Target Audience OMAR Inspectors / ED Offshore Inspectors / ED Specialist Inspectors

Contents • Summary (p.2) • Introduction (p.2) • Relevant Legislation (p.3) • Action (p.4) • Background (p.5) • Other relevant Inspection Guides (p.9) • Specialist Advice (p.9) • Organisation (p.9) Targeting Timing Resources Recording & Reporting

• Appendices (p.11) Appendix 1 - Pre-visit information Request - Documentation review Appendix 2 - Sample Inspection Agenda Appendix 3 – Role Specific Inspection Questions and Success Criteria Appendix 4 – Inspection Guidance – Well Examination Scheme System overview Appendix 5 - Application of EMM and Duty holder Performance assessment Appendix 6 - References / Further Reading

Summary This IG outlines an approach to the inspection of duty holder’s arrangements with respect to Well Examination Scheme’s and the key areas that inspectors should consider when inspecting this topic. It also sets out the criteria for satisfactory and unsatisfactory performance factors against which duty holder performance will be rated. References are made to technical standards and guidance that inspectors will use to form an opinion of legal compliance.

For external waters the Offshore Installations (Offshore Safety Directive)(Safety Case etc.) Regulations 2015 (SCR 2015), that came into force on 19th July 2015 requires well operators to have arrangements in writing for the examination of wells as an independent check to assure the well operator that the well is designed and constructed properly, and that it is maintained adequately thereafter. The arrangements must be in place before design of a well is commenced. The arrangements also apply to wells predating the regulations. A copy of the arrangements and any reports and recommendations arising from them must be kept at a designated address in Great Britain (i.e. England, Scotland or Wales) and for six months beyond the end of the arrangements.

For internal waters and onshore Great Britain Regulation 18 of the Offshore Installations and Wells (Design & Construction, etc) Regulations 1996 require the well operator to have a Well Examination scheme as per that described above.

Introduction The purpose of this Inspection Guide is to provide information and guidance to OMAR & ED Inspectors to support the delivery of consistent and effective inspection of duty holder arrangements to comply with the Well Examination requirements as per the Offshore Installations (Offshore Safety Directive)(Safety Case etc.) Regulations 2015 (SCR 2015), and Regulation 18 of the Offshore Installations and Wells (Design & Construction, etc) Regulations 1996.

This Inspection Guide highlights key areas for inspection and provides a framework against which inspectors can judge compliance, assign performance ratings and determine what enforcement action should be taken with respect to legislative breaches that may be found.

Relevant Legislation There is a general duty under Regulation 13 of the Offshore Installations and Wells (Design and construction, etc) Regulations 1996 for the well operator to:

ensure that a well is so designed, modified, commissioned, constructed, equipped, operated, maintained, suspended and abandoned that:

a) so far as is reasonably practicable, there can be no unplanned escape of fluids from the well; and b) risks to the health and safety of persons from it or anything in it, or in strata, to which it is connected, are as low as reasonably practicable.

This general duty is supplemented by further regulations, including regulation 11 of The Offshore Installations (Offshore Safety Directive)(Safety Case etc.) Regulations 2015 for the well operator in external waters to:

(1) establish a scheme (a “well examination scheme”) for ensuring, by the means described in paragraph (2), that the well is so designed and constructed, and is maintained in such repair and condition, that -

a) so far as is reasonably practicable, there can be no unplanned escape of fluids from the well; and

b) risks to the health and safety of persons from it or anything in it, or in strata, to which it is connected, are as low as reasonably practicable.

(2) the means are-

a) examination by a well examiner of –

i. any part of the well, or similar well;

ii. information, including information on the design and construction of the well and the sub-surface environment, including the geological strata and formations, the fluids within them and any hazards which the strata and formations may contain;

iii. work in progress;

b) the creation of reports by a well examiner on –

i. the examination carried out

ii. the findings

iii. any remedial action recommended;

c) the taking of appropriate action by the well operator following a report;

d) the making of a note of action taken by the well operator following a report;

e) the reporting by a well examiner to the well operator of any instances of non-compliance of the well operators with the standards of the scheme;

f) the taking of other such steps as may be provided for pursuant to regulation 12 and Part 2 of Schedule 4; and

g) the taking of any steps incidental to the means described in sub-paragraphs a) to e).

(3) The Well Operator must record the well examination scheme in writing

(4) The duties in paragraphs (1) and (3) must be completed before the design of a well is adopted.

Regulation 18 of the Offshore Installations and Wells (Design and construction, etc) Regulations 1996 has the same requirement for the well operator in internal waters and onshore GB to have a well examination scheme:

(1) Before the design of a well is commenced or adopted the well-operator shall make and put into effect arrangements relating to the well of a kind described in paragraph (2) or (where such arrangements already have effect in relation to another well) apply such arrangements, with any appropriate modifications, to the well.

(2) The arrangements referred to in paragraph (1) are arrangements in writing for such examinations, by independent and competent persons, of any part of the well, or similar well, information, or work in progress, and the making of such reports and recommendations, as are suitable for ensuring (with the assistance of such other measures as the well-operator takes) that the well is so designed and constructed, and is maintained in such repair and condition, that —

(a) so far as is reasonably practicable, there can be no unplanned escape of fluids from the well; and

(b) risks to the health and safety of persons from it or anything in it, or in strata to which it is connected, are as low as is reasonably practicable.

(3) The well-operator shall review and revise the arrangements as often as may be appropriate.

(4) The well-operator shall ensure that the arrangements, any revision of them, and reports and recommendations pursuant to them are kept at an address in Great Britain notified to the Executive, until the expiration of six months after the arrangements and any revision of them cease to be current.

(7) For the purpose of this regulation a person shall be regarded as independent only where —

(a) his examination will not involve the consideration by him of an aspect, of a thing liable to be examined, for which he bears or has borne such responsibility as might compromise his objectivity; and

(b) he will be sufficiently independent of a management system, or of a part thereof, which bears or has borne any responsibility for an aspect, which he might consider, of a thing liable to be examined, to ensure that he will be objective in discharging his function

Action Inspectors should review relevant documentation (see Annex 1 Pre-visit Information Request) prior to the inspection and test compliance during the inspection against the “Success Criteria” given in Appendix 3. Appendix 3 also contains a set of role-specific questionnaires which are completed during the inspection. Finally, the suitability and level of compliance of the Well Examination scheme is captured by completing a system review overview (see Appendix 4).

By the conclusion of the inspection it should be possible to: • determine if the well operator has a consistent and effective well examination scheme of offshore and / or onshore oil and gas wells.

When carrying out inspections covered by this IG inspectors should: • Assess duty holder responses against the success criteria in Appendix 3 and 4 • Use the performance descriptors in Appendix 5 to: o Determine the appropriate performance rating. o The initial enforcement expectation. o Consider how and when the issues raised during an inspection are to be closed out.

The questions were developed from previous well examination scheme inspections. The questions have been revised to reflect the maturity of well examination schemes offshore in the UKCS and onshore in GB and changes imposed by SCR2015.

Background Well examination has been a legal requirement since 1996. It is intended to provide assurance that the well is designed and constructed properly and is adequately maintained. The purpose is to provide a scheme of quality control and quality assurance that ensures the well complies with the general duty imposed by regulation 13 of DCR and incorporates current industry guidance.

It is essential for the examination to demonstrate that the pressure boundary of the well is controlled throughout the well’s lifecycle and that the pressure containment equipment that forms part of the well is suitable for the purpose. The responsibility for the effectiveness of the well examination scheme lies with the well operator.

It is not expected that examination schemes will necessarily rely on physical examination of the wells. Schemes typically make use of documentary evidence of well safety providing the documents’ veracity can be relied upon. The examination process is on-going and must cover the entire life

cycle of the well from design, through drilling and construction, the operate and maintain phase and any well intervention activities in the well, to being permanently plugged and abandoned.

Offshore Energies UK (OEUK) Guidance The Wells Forum initially produced two separate guidelines on well examination for Oil and Gas UK, now called OEUK. The guides were separated into guidelines for well operators on well examination and guidelines for well operators on competency of well examiners. They were written by the Well Examination Workgroup which included experts from several operators and were reviewed by external stakeholders that included independent well examiners, those using internal examination, other Wells Forum members, the HSE and OPRED. The latest revision of the Well Examination guidelines has been updated to combine these two documents, Guidelines for Well Operators on Well Examination (Issue 2) and Guidelines for Well Operators on Competency of Well Examiners (Issue 2).

The guidance is relevant to:

• all well operators of wells onshore in GB and offshore in the UKCS; • all aspects of wells and well operations throughout the well’s lifecycle from initial design to abandonment including production / injection stages and all suspended wells; and, • demonstrations of competence by well examiners and competency for well examiners.

The guidelines address arrangements for well examination, contents of an examination scheme, limits of a well examination scheme, administration of a well examination scheme, and interface with the installation’s verification scheme.

Previous inspection findings Since the introduction of a regulatory requirement for well examination schemes in 1996 most duty holders’ schemes have been inspected by HSE. These inspections have had findings that are common to those of many Well Operators.

Ownership and responsibility for Scheme: It is a common error to believe the well examiner is responsible for a well examination scheme. Responsibility for the well examination scheme lies squarely with the well operator. Responsibility covers all aspects of the scheme. The well operator is responsible for ensuring that the scheme is in place, for ensuring that the well examiner is both competent and independent, for ensuring that the scheme is and continues to be effective and that

suitable action is taken on any recommendations that the well examiner may make. The person with overall responsibility for the scheme should be clearly identified; and their roles and responsibilities should be clearly defined.

Inclusion of all wells: Duty holders occasionally miss part of their well inventory from the well examination scheme. Those most frequently omitted include suspended wells or wells on production or injection that have not been worked over for some time. This is especially true of subsea wells inherited from a previous asset owner. Duty holders must ensure that their entire well inventory is covered by the scheme. It is recommended that, on inheriting wells from another well operator, duty holders review the previous well examination scheme and records for each well in question.

Life Cycle of Well: Some well operators’ schemes lack continuity. The purpose of a well examination scheme is to cover the design, construction and ongoing maintenance of the well continuously throughout its life from initial design to its final plugging and abandonment. With some well operators the well examination scheme is seen as a responsibility of the company’s drilling department. Consequently, once a well has been drilled, completed and handed over to the production department, the well examination scheme ceases to be applied unless and until the drilling department once again takes over the well for a major work-over.

Interface with Installation Verification Schemes: The interface between well examination schemes and installation verification schemes must be properly managed. It is an aspect of schemes that is frequently overlooked. There is a potential for gaps to occur between the two schemes. The intent of well examination is to parallel installation verification schemes; they could not be merged because of the different duty holder structure for installations and wells. Nonetheless some well equipment, in particular Xmas trees, is suitable for inclusion in either scheme. Some equipment such as blowout preventers may need to be covered by both schemes as examination considers suitability for the well conditions and verification considers the on-going functionality and availability of the equipment.

All modifications to design and construction of wells: Major modifications arising from full workover of wells are usually fully covered in examination schemes. Other modifications arising from minor well interventions or from tree and wellhead maintenance are often neglected. It is important that the well examiner is informed of all modifications to wells; minor changes, for example to wellhead or tree fittings, can have a significant impact on safety. Drilling and production engineers should be properly briefed to ensure that this happens.

Inclusion of Mobile Equipment: Not all schemes make adequate provision to cover mobile temporary well control equipment. When such equipment, for example a wire-line BOP and lubricator or a high-pressure riser, is installed on a well, it forms part of the pressure containing envelope and must be covered by the well examination scheme and installation verification scheme.

Independence of the examiner: Independence of the well examiner is clearly defined in regulation 2 of SCR2015: “a person is to be regarded as independent only where the person’s function will not involve the consideration by that person of an aspect of something liable to be examined under regulation 9 or 11 for which that person bears or has borne responsibility or where that person’s objectivity may be compromised; and the person is sufficiently independent of a management system which has, or has had, any responsibility for any aspect of something liable to be examined by the person under regulation 9 or 11 so as to ensure objectivity in carrying out the person’s functions under the scheme.” Although it is permissible for the well examiner to be an employee of the well operator’s organisation, it is imperative that he has a high degree of impartiality and independence from pressures from the well operator, especially of a financial nature. Promotion pay and reward systems must not undermine their technical judgement. Some duty holders fail to achieve the level of independence required.

Competence of the examiner: Competence requirements for a well examiner are explained in guidance to the regulations and in OEUK guidance. It should be someone with sound knowledge and experience of the work to be examined. Competence must cover the full life cycle of the well from design to final abandonments and include any well servicing and change in use that may occur during its lifetime. It is recognised that all the competencies required may not reside with one individual and several individuals may be required to cover all of them. The weakness of many schemes is a lack of any procedure to check the competence of the well examiner, for both breadth and depth of knowledge. As with independence, few duty holders carry out audits of their schemes to verify the competence of well examiners.

Information, instruction, training and supervision of staff: A common finding when inspecting schemes, is not to fully inform and instruct those staff in the scheme and to consider it solely a matter for the person responsible for the scheme and the examiners themselves. Well operators have overall responsibility for the effectiveness of their well examination schemes. Training in the scheme should be provided for all drilling, completion and production engineers involved in the design of well and the development of well programmes. Training should include clear guidance on the type of information that should be fed into the scheme. Similar training should be provided for operators’ drilling and well service supervisors as well as key personnel employed by drilling and well service contractors.

Guidance on ALARP: Well examiners are, in general, given no guidance on the ALARP principle. Regulations on the design and construction of wells are based on the principle of reducing risk to the health and safety of persons from the well or anything in it to as low as is reasonably practicable. The principle is commonly referred to by the acronym ALARP; the term “reasonably practicable” is defined in law. Explanations of ALARP, including information on legal precedents can be found on the HSE website.