E6-4303. Outer Continental Shelf (OCS) Civil Penalties

AGENCY:

Minerals Management Service (MMS).

ACTION:

Notice summarizing OCS Civil Penalties Paid, January 1, 2005, through December 31, 2005.

SUMMARY:

This notice provides a listing of civil penalties paid January 1, 2005, through December 31, 2005, for violations of the OCS Lands Act (OCSLA). The goal of the MMS OCS Civil Penalties Program is to assure safe and clean operations on the OCS. Through the pursuit, assessment, and collection of civil penalties and referrals for the consideration of criminal penalties, the program is designed to encourage compliance with OCS statutes and regulations. The purpose of publishing the penalties summary is to provide information to the public on violations of special concern in OCS operations and to provide an additional incentive for safe and environmentally sound operations.

FOR FURTHER INFORMATION CONTACT:

Joanne McCammon (Program Coordinator), 703-787-1292.

SUPPLEMENTARY INFORMATION:

The Oil Pollution Act of 1990 (OPA 90) strengthened section 24 of the OCSLA Amendments of 1978. Subtitle B of OPA 90, titled “Penalties,” increased the amount of the civil penalty from a maximum of $10,000 to a maximum of $20,000 per violation for each day of noncompliance. More importantly, in cases where a failure to comply with applicable regulations constitutes or constituted a threat of serious, irreparable, or immediate harm or damage to life (including fish and other aquatic life); property; any mineral deposit; or the marine, coastal, or human environment; OPA 90 provided the Secretary of the Interior (Secretary) with the authority to assess a civil penalty without regard to the requirement of expiration of a period of time allowed for corrective action.

On August 8, 1997, (62 FR 42668), MMS published new regulations implementing the civil penalty provisions of the OCSLA. Written in “plain English,” the new question-and-answer format provides a better understanding of the OCS civil penalty process. In addition, the provisions of OPA 90 require the Secretary to adjust the maximum civil penalty to reflect any increases in the Consumer Price Index. The new rule increased the maximum civil penalty to $25,000 per violation, per day. Please note, subsequent to publishing the new regulations, MMS made several corrections and amendments, including the appeals procedures. These were published at 63 FR 42711, 8/11/98; 64 FR 9066, 2/24/99; 62 FR 9065, 2/24/99, and 64 FR 26257, 5/13/99.

On November 28, 2003, (68 FR 61622), MMS published a new regulation adjusting the civil penalty assessment to comply with the Department of Labor's Consumer Price Index. The amount is now $30,000 per violation per day.

Between August 18, 1990, and January 2006, MMS initiated 531 civil penalty reviews. Operators have paid 418 civil penalties for a total of $13,780,792 in fines. Seventy eight cases were dismissed; 5 cases were merged; and 30 cases are under review.

On September 1, 1997, the Associate Director of Offshore Minerals Management issued a notice informing lessees and operators of Federal oil, gas, and sulphur leases on the OCS that MMS will annually publish a summary of OCS civil penalties paid. The annual summary will highlight the identity of the party, the regulation violated, and the amount paid. The following table provides a listing of the penalties paid between January 1, 2005, and December 31, 2005. Please note that the MMS published a direct final rule ((5/29/98), 63 FR 29477) that renumbers each section in 30 CFR part 250. A quarterly update of the list, along with additional information related to the renumbering of the regulations, is posted on the MMS Worldwide Web Home page, http://www.mms.gov.

2005 Civil/Criminal Penalties Summary, All Penalties Paid in Calendar 2005 (01/01/2005-12/31/2005)

[The following acronyms are used in this table: PSL (pressure safety low); IP (intermediate pressure); ESD (emergency shutdown device); SCSSV (surface controlled subsurface safety valve); LSH (level safety high); HP (high pressure); BOP (blow out preventer); SSV (surface safety valve); PSHL (pressure safety high/low); AFFF (aqueous film forming foam); PSV (pressure safety valve); LSL (level safety low); INC (incident of non-compliance); H2S (Hydrogen Sulfide).]

Operator name (contractor) and case No.	Violation and date(s)	Penalty paid and date paid	Regulation(s) violated (30 CFR)
W & T Offshore, Inc., G-1997-026	A burning operation was conducted without the issuance of a written authorization for the work and the site was not being monitored with a portable gas detector	$40,000 01/18/05
	12/07/96-12/07/96		250.52(b)
	12/07/96-12/07/96		250.52(d)(2)
Seneca Resources Corporation, G-1997-030	The SSCSV (in a landing nipple) was not tested for one testing period (tested on 11/3/94 and then on 1/23/96.) Also, the pipeline shut down valve from West Delta 32C to West Delta 32A was found defective and left in service for 17 days	$85,000 10/12/05
	05/23/96-05/23/96		250.124(a)(1)(ii)
	05/23/96-05/23/96		250.154(b)(2)
Blue Dolphin Exploration Company, (Petroleum Offshore Professional Services), G-2000-059	Tubing plugs on 8 wells not inspected for leakage within required timeframe. Electrical installations not maintained in accordance with API RP 500 & RP 14F. Crane inspection of 6/00 indicated that emergency shut down cable and boom angle indicator needed to be replaced; crane not taken out of service	$24,000 09/22/05
	04/02/99-10/03/00		250.804(a)(1)
	10/02/99-10/03/00		250.804(a)(1)
	10/04/00-10/04/00		250.114(c)
	06/14/00-10/04/00		250.108
Maritech, (Petroleum Offshore Professional Services), G-2003-016	Approval was granted to install an SSCSV in lieu of an SSCSV in Satellite Well No. 1 with the condition that at the first sign of sand production the well would be shut-in immediately and the approval rescinded. Numerous occurrences of produced sand were not reported to the district and the well remained on production. The SSCSV was removed from the well and found to be damaged. It was reinstalled in the well which was not plugged or attended overnight	$140,000 12/16/05
	2/3/03-2/4/03		250.804(a)(1)(ii)
	11/5/02-2/4/03		250.801(h)(3)
Murphy Exploration & Production Company—USA, G-2004-011	The PSL for the intermediate pressure IP Separator was found in bypass	$14,000 02/01/05
	04/05/04-04/06/04		250.803(c)(1)
Devon Louisiana Corporation, G-2004-012	The isolation valves for two ESD Stations were found in the bypassed position, rendering the two ESD stations inoperable	$10,000 03/15/05
	04/16/04-04/16/04		250.803(c)(1)
Shell Offshore Inc., G-2004-013	The surface controlled SCSSV was found blocked out service by the hydraulic control line closed at the isolation valve on the tree	$27,000 03/02/05
	06/16/04-06/24/04		250.803
Forest Oil Corporation, G-2004-014	The LSH on sump tank was found bypassed at the safety system panel. The blocked out safety device was not flagged nor being monitored by personnel. Safety Device bypassed for 1 day	$10,000 06/29/05
	06/03/04-06/03/04		250.803(c)
ExxonMobil Corporation, G-2004-016	A 4′ × 8′ section of top deck grating had been removed in order to facilitate a wireline unit removal operation. The area was not flagged or barricaded to warn personnel of the open area; and personnel working in the direct vicinity of the open hole were not wearing fall protection gear	$10,000 04/19/05
	04/26/04-04/26/04		33 CFR 142.42
Anadarko E&P Company LP, (Island Operators Co. Inc.), G-2004-019	The main group device selector switches for both the HP separator (MBD 1050) and the IP separator (MBD 1100) were bypassed. The end devices were not flagged, nor were they being monitored	$13,500 04/12/05
	05/04/04-05/04/04		250.803
	05/04/04-05/04/04		250.803
Forest Oil Corporation, (Ensco Offshore Co.), G-2004-020	An accident involving an injury occurred on 04/19/04 while the crew was changing the annular rubber. The operation was not performed in a safe manner, and an employee lowered through the rotary was injured when the BOP stack shifted	$30,000 01/21/05
	04/19/04-04/19/04		250.107(a)
Energy Partners, Ltd., G-2004-021	SCSSV for Well F-3 was blocked out of service; not flagged nor being monitored. Safety Device blocked out of service for 9 days	$9,000 04/12/05
	12/07/03-12/15/03		250.803(c)
Forest Oil Corporation, G-2004-022	Required safety equipment (smoke and/or thermal rate of rise detectors) for both the Company Man's Office/Bunkhouse and the Galley were inoperable	$64,000 04/22/05
	05/29/04-06/01/04		250.803(b)(9)
Apache Corporation, (Island Operators Co. Inc.), G-2004-024	Pipeline Pump PSL bypassed and a failure to report casing pressure caused by a hole in the tubing	$82,000 03/02/05
	03/09/04-03/09/04		250.803
	09/23/03-02/13/04		250.517(c)
Kerr-McGee Oil & Gas Corporation, G-2004-025	The manual relay for the SSV was pinned and tie-wrapped out of service	$7,500 04/18/05
	07/16/03-07/16/03		250.803
Stone Energy Corporation, (Rowan Drilling), G-2004-028	Failure to initiate prompt well control measures to control the influx of well formation fluids which entered the wellbore	$20,000 05/25/05
	08/08/04-08/08/04		250.107
Century Exploration New Orleans, Inc., (Island Operators Co., Inc.), G-2004-029	The AFFF had not been replaced after failing an analysis test	$10,000 04/28/05
	09/28/04-09/28/04		33 CFR 146.15
Forest Oil Corporation, (Baker Energy, Inc.), G-2004-030	The 150 gal AFFF Fire Boss Unit was not being maintained in an operable condition since the effectiveness of the foam was not being monitored	$20,000 04/22/05
	10/13/04-10/13/04		250.803(b)(8)
Bois d'Arc Offshore Ltd., (Eagle Consultants), G-2004-031	The Platform was producing without an operable firewater system for 2 days	$20,000 05/24/05
	07/20/04-07/21/04		250.803(b)(8)
Newfield Exploration Company, G-2004-032	The PSVs on Compressor Nos. 1 & 2 were isolated, rendering them inoperable; and there were no fusible loop material (TSE) over the engine for Compressor No. 1	$40,000 07/22/05
	08/18/04-08/21/04		250.803(c)
	08/18/04-08/21/04		250.802(b)
	08/21/04-08/21/04		250.803(c)
Apache Corporation, G-2005-004	Open holes in cellar deck and +10 levels without appropriate barricade to prevent personnel from falling into the holes	$15,000 07/01/05
	11/09/04-11/09/04		33 CFR 142.87
Pogo Producing Company, G-2005-005	Bypassed LSL on the test separator with the upper and lower isolation valves in the closed position	$10,000 09/27/05
	08/05/04-08/05/04		250.803
Newfield Exploration Company, (Rowan Drilling), G-2005-006	Personnel were observed working without fall protection gear while engaged in an activity where there was a hazard of falling 10 or more feet	$10,000 07/22/05
	11/23/04-11/23/04		250.107
Apache Corporation, (Dolphin Service Inc.), G-2005-009	An employee fell 45 feet into the Gulf when he stepped through the open hole created by the removal of wooden boards which had been placed over the open hole to protect it	$25,000 07/01/05
	12/20/04-12/20/04		250.107(a)
The Houston Exploration Company, (Grasso Production Management), G-2005-010	The Gas Detector Head (ASH-10) for gas compressor 802 was found inoperable due to the sensor being disconnected from the main circuit board panel. The blocked out safety device was not flagged nor being monitored by personnel. Safety Device bypassed for 1 day	$10,000 11/28/05
	01/03/05-01/03/05		250.803(c)
Bois d'Arc Offshore Ltd., (Eagle Consultants), G-2005-011	The Burner Safety Low for the fuel to the Glycol Reboiler, EAW-921, and the Temperature safety High for the media and the stack were in by-pass. The blocked out safety devices were not flagged nor being monitored by personnel. Safety Devices bypassed for 1 day	$10,000 09/15/05
	03/02/05-03/02/05		250.803(c)
Total Penalties Paid: 01/01/2005-12/31/2005
26 Cases: ($756,000)
The purpose of publishing the penalties summary is to provide information to the public on violations of special concern in OCS operations and to provide an additional incentive for safe and environmentally sound operations.

Dated: February 24, 2006.

Thomas A. Readinger,

Associate Director for Offshore Minerals Management.