EU proposes new rules for offshore oil, gas activities

The EU has proposed a new set of rules aimed at avoiding a repeat of the environmental disaster in the Gulf of Mexico last year.

According to the proposals, companies holding oil licences will be made liable to any damage to the environment caused through their activities, while stricter precautionary rules will be put in place to minimise health and safety risks.

Currently, 13 EU member states have active oil and gas installations on their territory while Malta and Cyprus have also given out exploration licences although none is yet active.

It is estimated there are some 100 oil and gas offshore installations in EU waters, estimated to extract 90 per cent of all the oil and 60 per cent of gas produced in the EU. The biggest installations are in the North Sea although Norway, not an EU member state, is also considered to be a leading oil producer.

The proposed new rules were drawn up following months of discussions with member states, oil experts and companies. They now have to be approved by the 27 member states and by the European Parliament.

Brussels is proposing that, before deciding to grant a particular licence, member states will have to make sure that only those operators with sufficient technical and financial capacity to control the safety of offshore activities and environmental protection are allowed to conduct oil and gas activities in EU waters.

Member states also have to ensure that technical solutions presented by the operator that are critical for installation safety are verified by an independent third party prior to and periodically after the installation.

The EU is also proposing that oil and gas companies be fully liable for environmental damage caused to the protected marine species and natural habitat. For damage to waters, the geographical zone will be extended to cover all EU marine waters including the exclusive economic zone (up to about 370 kilometres from the coast) and the continental shelf where the coastal member state exercises jurisdiction.