Center for Offshore SafetySEMS and SEMS II: The Latest on Auditing –

Requirements, Learning's, Developments and OpportunitiesOctober 9, 2013

Jeff Ostmeyer, EHS AdvisorOstmeyerJ@centerforoffshoresafety.org

www.centerforoffshoresafety.org

COS Mission

The Center for Offshore Safety is designed to promote the highest level of safety for offshore drilling, completions, and

operations through leadership and effective management systems addressing communication, teamwork, and independent third-party auditing and certification.

COS Vision & Path Forward

• One-stop central source for:

- Information & knowledge- Auditor accreditation- Program certification- Tools and technical assistance

• Promote an industry culture of incident-free operations

- Process safety in addition to personal safety- Emphasis on behavior- No harm to people, no harm to environment

• Elevate the industry’s quality and safety standards

- Create and share good practices- Continuous improvement

Dates and SEMS Auditing

SEMS • Effective Nov. 15, 2010 and required operators to

implement a SEMS program by Nov. 15, 2011.• Also required operators to submit their first complete

SEMS audit to BSEE by Nov. 15, 2013.

SEMS II• Effective on June 4, 2013 but operators have until June 4,

2014 to comply, except for auditing requirements.• All SEMS audits must be in compliance with the SEMS II

Rule by June 4, 2015.

COS Independent 3rd Party SEMS Auditing

Types of audits• Audits of Audit Service Providers (ASP)

• Office and Witness audits• Accreditation vs. Certification

• Types of industry audits• COS SEMS Audits

• Minimum 15% sample of facilities each cycle

Audit Characteristics%

Compliance Focus

% System Focus

Typically Performed

ByTypical

FrequencyKey

DriverInspectionPrescriptive

100 0 Field Daily/weekly/monthly

Compliance/Requirement

AssessmentPrescriptive or Performance

0-100 0-100 Field or SME Ad hoc Perceived need – Risk

Compliance AuditPrescriptive

80-90 10-20 Independent audit team

1-3 years/location

Compliance/ Requirement

Management System Audit *Performance

10-20 80-90 Independent audit team

3-5 years/Business unit or Region

Risk – AssuranceCorporate Responsibility

Characteristics of different types of audits

* SEMS Audit

SEMS Audit Reporting Timeline

SEMS audit Initiated

Contract with ASP to perform a

SEMS audit

COS provided a courtesy

notification

Audit Starts

Auditing Complete – Formal audit

close-out meeting

between ASP and Operator

Draft audit report provided

by ASP

Audit likely includes office and offshore

components.

Audit Plan

prepared

As Agreed to by member and

ASP6 Months Maximum

3 years

30 Days 30 Days

Minimum 30 Days

Operator decides that

audit will meet BSEE

requirements

Audit Plan provided to

BSEE

ASP issues a COS Standard Audit Report to the

Operator

Report identifies Non-Conformances

NCs (does not include corrective

action plans)

BSEE Audit Complete

Corrective action plans developed to

address NC’s identified in the Audit

Report

Corrective action plans include timing

and responsible parties

If audit to fulfill BSEE requirement – ASP submits the report to BSEE with corrective action plans included

ASP accepts and verifies corrective actions; all NCs must be closed out for ASP to

certify

ASP issues COS SEMS Certificate

ASP provides completed COS Standard Audit

Report with corrective action plans to COS in order to share

good practices.

Audit Closed

COS Member Company maintains

their SEMS program

COS Member Company starts next

COS certification

audit within 3 year period

COS Member implements

corrective action plan

As Agreed to by member

and ASP

COS member consults with ASP on a verification process.

SEMS Audit Reporting Timeline

SEMS audit Initiated

Contract with ASP to perform a

SEMS audit

COS provided a courtesy

notification

Audit Starts

Audit Plan

prepared

As agreed by member and

ASP

3 years

Minimum 30 Days

Operator decides audit will

meet BSEE requirements

Audit Plan provided to

BSEE

As agreed by member

and ASP

SEMS Audit Reporting Timeline

Audit Starts

Auditing Complete – Formal audit

close-out meeting

between ASP and Operator

Draft audit report provided

by ASP

Audit likely includes office and offshore

components.

6 Months Maximum

3 years

30 Days 30 Days

ASP issues a COS Standard Audit Report to the

Operator

Report identifies NCs (does not

include corrective action plans)

BSEE Audit Complete

SEMS Audit Reporting Timeline

Audit Starts

6 Months Maximum

3 years

30 Days 30 Days

ASP issues a COS Standard Audit Report to the

Operator

Report identifies Non-Conformances

NCs (does not include corrective

action plans)

BSEE Audit Complete

Corrective action plans developed to

address NC’s identified in the Audit

Report

Corrective action plans include timing

and responsible parties

If audit to fulfill BSEE requirement – ASP submits the report to BSEE with corrective action plans included

ASP accepts and verifies corrective actions; all NCs must be closed out for ASP to

certify

ASP issues a COS SEMS Certificate

ASP provides completed COS Standard Audit

Report with corrective action plans to COS in order to share

good practices.

Audit Closed

COS Member implements

corrective action plan

COS member consults with ASP on a verification process.

SEMS Audit Reporting Timeline

Audit Starts

6 Months Maximum

3 years

30 Days 30 Days

Minimum 30 Days

Operator decides that

audit will meet BSEE

requirements

Audit Plan provided to

BSEE

COS Member Company maintains

their SEMS program

COS Member Company starts next

COS certification

audit within 3 year period

SEMS Audit Reporting Timeline

SEMS audit Initiated

Contract with ASP to perform a

SEMS audit

COS provided a courtesy

notification

Audit Starts

Auditing Complete – Formal audit

close-out meeting

between ASP and Operator

Draft audit report provided

by ASP

Audit likely includes office and offshore

components.

Audit Plan

prepared

As agreed by member and

ASP6 Months Maximum

3 years

30 Days 30 Days

Minimum 30 Days

Operator decides audit will

meet BSEE requirements

Audit Plan provided to

BSEE

ASP issues a COS Standard Audit Report to the

Operator

Report identifies Non-Conformances

NCs (does not include corrective

action plans)

BSEE Audit Complete

Corrective action plans developed to

address NC’s identified in the Audit

Report

Corrective action plans include timing

and responsible parties

If audit to fulfill BSEE requirement – ASP submits the report to BSEE with corrective action plans included

ASP accepts and verifies corrective actions; all NCs must be closed out for ASP to

certify

ASP issues COS SEMS Certificate

ASP provides completed COS Standard Audit

Report with corrective action plans to COS in order to share

good practices.

Audit Closed

COS Member Company maintains

their SEMS program

COS Member Company starts next

COS certification

audit within 3 year period

COS Member implements

corrective action plan

As agreed by member

and ASP

COS member consults with ASP on a verification process.

60 Days - SEMS II

Goals of this presentation

What will the auditors look for?• Each element of SEMS

• Is each element in place?• Is each element being implemented?• Is each element effective?

NOTE: The question in the COS protocol is the question the auditor must answer…Not the question the auditor asks!

SEMS Elements

1. General – Principles & Scope2. Safety & Environmental Information3. Hazards Analysis4. Management of Change5. Operating Procedures6. Safe Work Practices7. Training 8. Mechanical Integrity9. Pre-Startup Review10. Emergency Response & Control11. Investigation of Accidents12. Auditing the Program13. Records & Documentation14. Stop Work Authority *15. Ultimate Work Authority *16. Employee Participation Plan *17. Reporting Unsafe Conditions *

* SEMS II - not required in first audit

SEMS Elements

1. General – Principles & Scope• This provides the overall definition of the

Operator’s SEMS compliance program. This section includes requirements for management responsibilities, buy-in and support.

• Format: Written documents.

SEMS Elements

2. Safety & Environmental Information• Deals with process safety information which

requires an employer to compile a complete list of hazards and a plan to deal with those hazards. Operator’s SEMS must include information that provides the basis for implementing all SEMS program elements, process design information, operating procedures and mechanical design information.

• Format: Written Plan & supporting documents. Strongly related to Hazard Analysis (#3), Operating Procedures (#5) and Safe Work Practices (#6).

SEMS Elements

3. Hazards Analysis• The operator must ensure the development and

implementation of a hazards analysis program (facility level) and a job safety analysis (operations/task level) for all facilities.

• Format: Likely includes review of hazard analyses, recommendations, and actions, and JSA’s.

SEMS Elements

4. Management of Change• Operator must develop and implement written

Management of Change procedures (MoC) for modifications associated with the following: (1) Equipment, (2) Operating procedures, (3) Personnel changes (including contractors), (4) Materials and (5) Operating conditions.

• Format: Written Documents

SEMS Elements

5. Operating Procedures• Must develop and implement written operating

procedures which provide instructions for conducting safe and environmentally sound activities involved in each operation addressed in the SEMS program. Some specific minimum requirements for what must be included in operating procedures.

• Format: Written document.

SEMS Elements

6. Safe Work Practices• This is a huge element.• The SEMS program must establish and implement safe work

practices designed to minimize risks associated with operating, maintenance and modification activities as well as the handling of materials and substances which could affect safety or the environment.

• The SEMS program must also document contractor selection criteria, including the contractor's safety and environmental performance.

• Operators must ensure that contractors have their own written safe work practices. Contractors may adopt appropriate sections of the operator's SEMS program. Operator and contractor must document their agreement on appropriate contractor safety and environmental policies and practices before the contractor begins work at the operator's facilities.

• Format: Written documents.

SEMS Elements

7. Training • Not just training, but knowledge and skills!• SEMS program must address: Initial training,

Periodic training, Communication of changes and verification of contractor’s personnel training.

• Must also address operating procedures, safe work practices and emergency response and control measures.

• Must document the qualifications of instructors. • Format: Learning Management System (LMS),

training matrix, e-learning, onsite training.

SEMS Elements

8. Mechanical Integrity• The operator must develop and implement written

procedures which provide instructions to ensure the mechanical integrity and safe operation of equipment through inspection, testing and quality assurance.

• The procedures must address: design, procurement, fabrication, installation, calibration and maintenance of equipment; training; inspections; correction of deficiencies; installation of new equipment; construction; verification of various equipment aspects; maintenance; parts; repairs.

• Format: Written documents; extensive use of SMEs; heavy archival requirements.

SEMS Elements

9. Pre-Startup Review• Final check to make sure everything is complete

and correct.• Involves the Operator’s commissioning process;

includes a pre-startup safety and environmental review for new and significantly modified facilities subject to Subpart S to confirm that specific criteria are met.

• Includes a training component.• Format: Primarily Procedures. Partially LMS and

training matrix.

SEMS Elements

10. Emergency Response & Control • These plans must be validated by drills carried out

in accordance with the SEMS training program. • Program must include: Emergency Action Plan;

Emergency Control Center(s) designated for each facility with access to the Emergency Action Plan, oil spill contingency plan, other safety and environmental information; training and drills.

• Format: Written documents with immediate retrieval and archival requirements. LMS, training matrix.

SEMS Elements

11. Investigation of Accidents • The SEMS program must establish procedures for

investigation of all incidents with serious safety or environmental consequences and require investigation of incidents determined by facility management or BSEE to possess the potential for serious safety or environmental consequences.

• Format: Written documents describing action. Immediate retrieval is important.

SEMS Elements

12. Auditing the Program• The SEMS program must be audited by either an

independent third-party or the Operator’s designated and qualified personnel*

• According to the requirements of this subpart and API RP 75, Section 12 within 2 years of the initial implementation of the SEMS program and at least once every 3 years thereafter. (*As defined by BSEE)

• Format: Action with findings as written documents.

• COS Audit Service Providers meet this criteria.• Only requirement is for a SEMS audit!

SEMS Elements

13. Records & Documentation• Reports must be submitted to BSEE.• Required by 30 CFR 250.1928 (in Subpart S).• Requires significant archiving of up to six years,

though the Legal Department may require a longer time period.

SEMS Elements

14. Stop Work Authority (30 CFR 250.1930)15.Ultimate Work Authority (30 CFR 250.1931)16.Employee Participation Plan (30 CFR

250.1932)17.Reporting Unsafe Conditions (30 CFR

250.1933)• Required by SEMS II.• Although included in SEMS, are usually covered

by the other elements.• Not included in RP 75 as separate elements.

SEMS Audit Protocol

All of the Elements in one place• Designed for auditors and is not an inspection

document.• 187 questions (SEMS I).• Covers both RP75 and SEMS.• RP 75 and SEMS Rule (30 CFR 250) Audit Checklist

with Guidance• Free access as part of COS services.• www.centerforoffshoresafety.org

SEMS Audit Protocol Checklist

All of the Elements in one place

COS SEMS Toolkit

SEMS Audit Protocol COS-1-01 (Revision 2 complete)

Compliance Readiness Worksheet COS-1-02

Operator-Contractor Letter Templates COS-1-03

Audit Guidance Document (Revisions starting)

• COS-2-01 Qualification & Competence Requirements Audit Leads & Auditors*• COS-2-02 Training Program Requirements for Auditors*• COS-2-03 Certification to API RP 75• COS-2-04 Accreditation of Audit Service Providers*• COS-2-05 Standardized Audit Report Form

* Incorporated by reference in SEMS II

Accreditation & Certification

The future of SEMS Auditing

SEMS II• A stop work authority which creates procedures and authorizes any and

all offshore industry personnel who witness an imminent risk or dangerous activity to stop work.

• An ultimate work authority which requires offshore industry operators to clearly define who has ultimate work authority on a facility for operational safety and decision-making at any given time.

• An employee participation plan which provides an environment that promotes participation by offshore industry employees as well as their management to eliminate or mitigate safety hazards.

• Guidelines for reporting unsafe working conditions which enable offshore industry personnel to report possible violations of safety, environmental regulations requirements and threats of danger directly to BSEE.

• Additional requirements for conducting a job safety analysis.• The team lead for an audit must be independent and represent an

accredited audit service provider.

The future of COS SEMS Auditing

Observing COS Audits – Continuous Improvement

Expand Audit Protocol Guidance• SEMS II• Drilling focus• Projects and Construction• Contractors

Lead Auditor Certification

US Coast Guard

Jeff Ostmeyer, EHS AdvisorOstmeyerJ@centerforoffshoresafety.org

www.centerforoffshoresafety.org

Questions, Comments or Concerns?

1990 Post Oak Blvd, Suite 1370Houston, TX 77056

www.centerforoffshoresafety.org