September 20, 2017

Drilling’s Safety Exemptions and How They Got There

“It’s mind-boggling to me how many safety standards they’re exempt from”
By Mike Soraghan, E & E Publishing, November 4, 2014

Read more in the series Danger Zone: Examining Safety in the Oil & Gas Boom

In 1983, troubled by the high death rate in the oil field, the Occupational Safety and Health Administration set out to impose a set of worker safety rules on drilling companies.

The effort backfired. As OSHA officials ushered the proposal through the process, they agreed to exempt drilling from other new rules on noise protection, machine safety and preventing explosions. Those topics, they said, would be covered in the pending oil and gas rulebook.

But when that proposal died, drilling companies wound up exempt from a suite of basic worker protections.

“It’s mind-boggling to me how many safety standards they’re exempt from,” said Dennis Schmitz, a trainer who leads the MonDaks Safety Network, a group of safety officials from companies in the Bakken Shale region. “What’s the culture that creates?”

In the 30 years since the drilling regulations were proposed, the industry’s death rate regularly has been among the highest in the United States. Current and former OSHA officials say the exemptions and the absence of the drilling regulations left safety inspectors with fewer tools to police an industry heavy with “unique hazards.”

And as petroleum production pushes into more populated areas, public health experts say the risks for those who live and work nearby remain poorly understood.

Industry leaders, though, say oil companies take safety seriously.

“We welcome strong regulation,” American Petroleum Institute President Jack Gerard said last year after a speech on industry standards. “We resist duplicative, contradictory, confusing regulation. There’s an important difference between the two in terms of our ability to operate.”

That ability to operate was under threat in late 1983, according to industry leaders at the time.

OSHA, created in 1970, had originally tried to regulate oil and gas under its construction standards. But industry challenged that, and OSHA gave up on the idea after it lost a series of enforcement cases.

Still, fatalities were mounting. Records show there were at least 459 deaths at drilling work sites from 1977 to 1981, an average of 92 a year.

In the early ’80s, OSHA began work on a new, separate set of rules, called a “standard,” for oil and gas drilling. The rule was formally proposed in late 1983, during President Reagan’s administration. In the Federal Register on Dec. 28, 1983, the agency laid out a stark rationale linking lack of regulation to worker deaths.

“OSHA believes that the current general industry standards inadequately address the unique hazards encountered during drilling,” agency officials wrote. “OSHA believes this lack of adequate regulatory protection has contributed to the high number of deaths and injuries in this industry.”

The drilling standard was to cover a wide variety of topics, from blowout preventers to hydraulic fracturing to how many employees had to be trained in first aid.

OSHA said at the time that some oil companies supported the proposal because they wanted a clear and consistent set of rules.

But industry lobby groups in Washington showed no such interest. They fought the rule hard even before it was formally proposed. They said it was too expensive. They preferred their own voluntary programs.

“It would require a number of major modifications to all rigs at a cost of millions of dollars for no real safety benefit,” Roy Carlson, production director at the American Petroleum Institute, wrote to OSHA in February 1983. “We see little likelihood that the current draft would improve safety beyond voluntary programs already developed in the industry.”

Some executives conceded that injuries had gone up during a drilling boom that started in 1979. But they said the industry was improving safety on its own.

“We agree that accident rates are high with respect to general industry, but it has not been established that rates are disproportionately high for the kind of work involved,” H.B. Barton, regulatory affairs manager for Exxon Co. USA, wrote in May 1984. “Continual progress is being made toward reducing accident frequency as a direct result of efforts within the industry.”

The industry resistance was effective. OSHA announced in 1985 that it would start over and rewrite the proposed rules. Officials in the Reagan White House said OSHA had understated the costs and said “extensive changes” were needed. After that, interest dwindled. But the proposal remained on the books through the administrations of Presidents George H.W. Bush and Clinton.

OSHA finally pulled the plug in 2001, in the early days of the George W. Bush administration.

Bush and then-Vice President Dick Cheney, both oilmen, led a drive to free domestic energy production from regulatory restraints. That drive led to, among other things, a ramp-up in drilling on federal lands in the Rocky Mountain West.

What’s a safe speed?

Not every industry has its own specific OSHA standard. The ones that do are construction, maritime and agriculture.

Without an industry-specific standard, OSHA continued to monitor oil and gas work sites using “general industry standards,” purposely vague enough to cover everything from routine office work to climbing a rig tower in the middle of the night. Inspectors enforce the “general duty” of oil and gas companies to provide a safe workplace.

OSHA officials said in 1983 that regulating oil and gas under general industry standards worked badly. Current and former OSHA officials say it’s still not a good fit.

One former OSHA official compared it to a police officer patrolling a highway without a set speed limit.

“The general duty clause is like saying, ‘You should drive at a safe speed,'” said R. Dean Wingo, a former assistant regional administrator. “The duty shifts to the officer to show what you were doing was unsafe.”

Wingo retired last year as assistant administrator for the Dallas-based region that includes the country’s top oil-producing states. However unpopular they might be with management, he said, the agency’s standards save lives and keep workers from getting hurt.

“If you look at OSHA’s history, where they developed standards for an industry, it has impacted that industry to improve safety and health,” he said.

A ‘powerful lobby’

There are OSHA standards that do cover work at well sites. Oil and gas crews, for example, must follow the standard covering electrical work. But industry is exempt from several standards other industries must follow. Most of those exemptions trace back to accommodations made while the drilling-specific standard was pending.

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