MEDITERRANEAN PAPER SERIES 2014

OFFSHORE SAFETY IN THE EASTERN MEDITERRANEAN
ENERGY SECTOR
IMPLICATIONS OF THE NEW EU DIRECTIVE
Miki Livnat
© 2014 Te German Marshall Fund of the United States. All rights reserved.
No part of this publication may be reproduced or transmitted in any form or by any means without permission in writing
from the German Marshall Fund of the United States (GMF). Please direct inquiries to:
Te German Marshall Fund of the United States
1744 R Street, NW
Washington, DC 20009
T 1 202 683 2650
F 1 202 265 1662
E info@gmfus.org
GMF Paper Series
Te GMF Paper Series presents research on a variety of transatlantic topics by staf, fellows, and partners of the German
Marshall Fund of the United States. Te views expressed here are those of the author and do not necessarily represent the
views of GMF. Comments from readers are welcome; reply to the mailing address above or by e-mail to info@gmfus.org.
About GMF
Te German Marshall Fund of the United States (GMF) strengthens transatlantic cooperation on regional, national, and
global challenges and opportunities in the spirit of the Marshall Plan. GMF does this by supporting individuals and institu-
tions working in the transatlantic sphere, by convening leaders and members of the policy and business communities,
by contributing research and analysis on transatlantic topics, and by providing exchange opportunities to foster renewed
commitment to the transatlantic relationship. In addition, GMF supports a number of initiatives to strengthen democra-
cies. Founded in 1972 as a non-partisan, non-proft organization through a gif from Germany as a permanent memorial to
Marshall Plan assistance, GMF maintains a strong presence on both sides of the Atlantic. In addition to its headquarters in
Washington, DC, GMF has ofces in Berlin, Paris, Brussels, Belgrade, Ankara, Bucharest, Warsaw, and Tunis. GMF also has
smaller representations in Bratislava, Turin, and Stockholm.
About the Mediterranean Policy Program
Te Mediterranean Policy Program promotes transatlantic analysis and dialogue on issues afecting Southern Europe, North
Africa, the Levant, and the Mediterranean basin. Priority areas include: understanding trends in Mediterranean societies;
exploring opportunities for south-south cooperation and integration; research on key functional issues afecting Mediter-
ranean security and development; and strengthening the North American policy debate on the region and transatlantic
cooperation on Mediterranean strategy.
GMF’s Eastern Mediterranean Energy Project addresses the political and economic implications, risks and opportunities
of the recent energy discoveries in the Eastern Mediterranean region. It aims to promote the conditions for the peaceful
development of the new energy opportunities in the Eastern Mediterranean and to promote regional cooperation on energy
issues. See more at: www.gmfus.org/programs/climate-energy
Cover photo: A disused pipeline leading across the beach to the ocean. © robcruse/istockphoto
Offshore Safety in the Eastern Mediterranean
Energy Sector
Implications of the New EU Directive
Mediterranean Paper Series
May 2014
Miki Livnat
1

1
Miki Livnat is CEO of P3ehs Ltd. focusing on environmental safety and sustainability management in large high-risk
capital projects for multinational companies. Earlier, Livnat held senior positions at Intel Corporation in environment,
health, and safety management for global operations. He holds a master’s degree in environmental science from the Hebrew
University of Jerusalem.
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The New EU Directive on Offshore Safety . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
International Conventions and National Regulations
on Offshore Safety in Israel and Cyprus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Comparisons and Implications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Conclusions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Offshore Safety in the Eastern Mediterranean Energy Sector 1
1
Introduction
T
he discovery of natural gas in the Tamar field
in Israel’s Exclusive Economic Zone (EEZ)
was announced on January 17, 2009. The
Tamar field, located 80 kilometers (50 miles) west
of Haifa at a depth of 1,700 meters (5,600 feet), was
Israel’s first large-scale hydrocarbon discovery. It
was also the first gas discovery in the Levant Basin
of the Eastern Mediterranean.
Since Tamar’s discovery, other large gas discov-
eries were made elsewhere in the region. In 2010,
the much larger Leviathan field was discovered
in the Israel EEZ. A year later, the Aphrodite field
was found in the Cyprus EEZ. Gas prospection is
currently under way in the Levant Basin offshore
Lebanon and Syria. Lebanon launched its first gas
licensing round in May 2013. The Levant Basin,
the Nile Delta Basin, and the Aegean Basin are
expected to hold considerable reserves of oil and
gas, which could transform the Eastern Mediterra-
nean into an important energy producing region.
The discoveries in the Levant Basin occurred
largely due to new technology that made it possible
to reach deeper waters and work at higher tempera-
tures and pressures. These innovations provide
economic benefits to the companies and countries
involved but also create new risks for the environ-
ment. Following the environmental catastrophe
at the Deepwater Horizon drilling rig in the Gulf
of Mexico, some 15 months after the discovery of
Tamar, the need for adequate safety measures to
manage these risks became apparent.
In response to the catastrophe, the European Union
(“EU”) adopted the Directive on Safety of Offshore
Oil and Gas prospection, Exploration and Produc-
tion Activities (the “Directive”) in July 2013. EU
Member states including Cyprus and Greece are
required to implement the Directive by July 18,
2015.
1
The Directive imposes safety obligations on
EU energy companies involved in offshore activities
throughout the world.
For countries such as Israel and other non-EU
countries in the Eastern Mediterranean that are
new to the energy industry, the Directive provides
a blueprint of the best international practice, which
they could use when adopting their own national
legislation. Any EU companies active in the region
are obliged to respect the provisions of the Direc-
tive. Since the consequences of offshore accidents
know no borders, cooperation between countries
in the Eastern Mediterranean is critical for the
prevention of accidents and for rapid intervention
if they occur. The drawing up of safety legislation in
countries of the region is an opportunity to begin
such cooperation.
The study undertaken by the EU prior to the adop-
tion of the Directive found that different national
safety regimes can complicate the understanding
and management of risks, increase costs, and
slow-down response time in the event of accidents
that produce trans-boundary effects. The U.K. and
the Netherlands have discovered that by working
together on offshore safety, they can improve
efficiency while reducing costs and environmental
risks. Similar considerations will apply in the future
in the Eastern Mediterranean where there is close
proximity between jurisdictions in the Levant Basin
(Israel, Turkey, Cyprus, Syria, Lebanon, and Egypt,
as well as the Palestinian Administration). All could
gain from adopting a compatible framework for
safety. The Directive, which also imposes certain
obligations on EU-registered vessels operating
in the waters of third countries, could provide a
model.
1
Directive 2013/30/EU of the European Parliament and of the
Council of June 12, 2013 on safety of offshore oil and gas opera-
tions and amending Directive 2004/35/EC, Official Journal of
the European Union, L178/66, 28 June, 2013
The German Marshall Fund of the United States 2
2
The New EU Directive
on Offshore Safety
T
he past 50 years have seen a series of offshore
accidents that have cost many lives. These
include the capsizing of the Alexander Kiel-
land platform in the Norwegian sector of the North
Sea in 1980 that killed 123 people and the explosion
at the Piper Alpha platform in the North Sea in
1988 in the United Kingdom’s EEZ that killed 167
people. National regulations concerning offshore
safety and the evacuation of personnel in the event
of an accident were tightened in response to these
accidents.
The EU decided to review safety regulations in the
member states following the Deepwater Horizon
accident in 2010. After almost three years of inten-
sive work, the Directive was adopted.
The key objectives of the Directive are:
• to reduce the occurrence of major accidents
relating to offshore oil and gas operations;
• to establish a framework for the safe explora-
tion and production of oil and gas, thereby
increasing protection of the marine environ-
ments against pollution;
• if prevention fails, to ensure that clean-up and
mitigation are carried out to limit the conse-
quences; and
• to improve the response in the event of an
incident.
Integrated Offshore Rules for Safety and
Environmental Protection
The Directive addresses both safety and envi-
ronmental risks, as they are inter-connected.
This formalizes the practice that has increasingly
become the norm in North Sea countries as well as
in Australia, New Zealand, and Canada. The United
States took a similar approach in the 2011 reorga-
nization of the Bureau of Safety and Environmental
Enforcement (BSEE), an agency under the Depart-
ment of the Interior. The goal is to establish a single
framework that eliminates overlaps, redundancies,
and inconsistencies.
Risk Based Goal-Setting Approach
The Directive adopts a risk-based goal-setting regu-
latory approach. In particular, it requires owners
and operators to demonstrate to the regulators
that all major accident risks have been identified
and assessed and that measures have been adopted
to minimize risks. To achieve this goal, a “Major
Hazards Report” must be submitted to the regula-
tors. This goal-oriented approach should reinforce
the responsibility for managing risks of the owners
and operators of offshore installations.
Before the two accidents referred to above, regula-
tions concerning safety on oil and gas installations
in both Norway and the U.K. were prescriptive
in nature. Under this approach, detailed require-
ments are imposed by the regulators. Prescriptive
regulation is suitable for managing “traditional”
occupational safety and environmental risks as they
are characterized by high frequency of occurrence
and low relative impact. This has, however, proved
ill-suited to an industry characterized by events of
high hazard and low frequency, where technology
and risks change rapidly. Following the Deepwater
Horizon catastrophe, the United States is consid-
ering departing from the prescriptive approach
and adopting a more goal-oriented approach to the
regulation of offshore safety.
One Framework and One Set of Objectives
The offshore energy industry is highly mobile with
installations that operate in the EEZs of different
countries and a multi-national labor force. The aim
of the Directive is to achieve higher safety and to
reduce risks by making rules concerning the safety
of offshore installations consistent and coherent
throughout the EU. In addition, it requires EU
companies operating outside EU-regulated waters
to i) ensure that their major accident preven-
tion policies cover such operations and ii) report
Offshore Safety in the Eastern Mediterranean Energy Sector 3
any major accidents they are involved in to their
country of registration.
One Independent and Objective “Competent
Authority” in Each Country
The Directive requires each member state to set
up an authority that is technically competent
and independent. This provision is intended to
avoid conflicts of interest that might otherwise
arise. The competent authority will act as a single
point of contact for the operators by integrating,
aligning, and streamlining the requirements of the
various government agencies involved in super-
vising offshore oil and gas activities. It should not
be responsible for the economic development of
offshore natural resources or licensing of offshore
oil and gas operations.
The Directive enables each EU member state
to decide upon the institutional structure of its
competent authority. For countries with small econ-
omies and little offshore activity, where complete
separation of the competent authority from other
related responsibilities would be impractical, the
member state concerned is required to adopt
the best alternative arrangements to ensure the
independence and objectivity of the competent
authority.
The responsibilities of the competent authority
include:
• enforcement;
• reviewing Reports of Major Hazards and
providing comments;
• informing operators of the procedure they are
required to follow in drawing up safety plans
and, when satisfied, approving them;
• scrutinizing the technical capacity and financial
liability of companies, as part of the licensing
procedure; and
• requesting reports from the operators on
offshore performance and sharing them with
other member states.
Under the Directive, it is up to the member states to
determine how the costs of the authority are met. A
member state may decide that these costs are to be
borne by the oil and gas industry.
Requirement for a Major Hazard Report
The Directive requires the operator to prepare a
Major Hazard Report before obtaining a license.
This requirement is designed to ensure that major
hazards have been identified, and that a major
accident prevention policy, appropriate control
measures, a safety and environmental management
system, and an internal emergency response plan
are in place.
Other provisions of the Directive include the
independent verification of the suitability of
critical safety and environmental equipment, their
examination and testing, and the need for opera-
tors to respond to the verifier and take appropriate
action. Reporting obligations are also imposed on
operators in order to provide greater transparency
and the sharing of experience while safeguarding
commercial confidentiality.
Obligations of Owners and Operators
The Directive does not prescribe specific technical
standards; existing industry and national standards
will remain valid. Differences in national require-
ments on technical issues such as well control, well
design and integrity, emergency shutdown, and
emergency response will remain, provided that they
are consistent with the goals of the Directive.
The Directive requires that adequate environmental
and safety management systems be in place and
requires a high level of transparency. The safety and
environmental management system provided for
by the Directive obliges the operators to assess risks
according to the Major Hazard Report. If this shows
The German Marshall Fund of the United States 4
that there are gaps, the operators must take action
to reduce risks.
The Directive is focused on safety management
systems because weaknesses in these have been
responsible for most major accidents. The factors
contributing to past accidents include the quality
of management decision-making, the competence
and skills of workers and managers, coordination
between owners and sub-contractors, and clarity of
roles and responsibility. Changes in management
systems are harder to implement than technical
measures, even though their cost may be much
lower, because of resistance by management and
staff.
Others obligations of owners and operators include:
• Inclusion of major environmental consequences
in the Report on Major Hazard;
• Obtaining approval by the regulator before
beginning operations with fixed and mobile
installations;
• Demonstrating that a comprehensive safety and
environment management system is in place,
including schemes for independent verification
of critical safety elements and well plans;
• Demonstrating technical and financial capacity
throughout the lifecycle of operations, starting
at the licensing stage;
• Accepting liability for environmental damage;
• Submitting major accident prevention policy to
the regulator;
• Drawing up an emergency plan for immediate
response to major accidents, preventing escala-
tion;
• Notifying regulator before starting well opera-
tions;
• Submitting weekly well reports to regulator;
• Reporting on major accidents involving the
operator overseas;
• Securing cooperation of the workforce and
protecting whistle-blowers;
• Engaging in tripartite consultation;
• Reporting incidents and near-misses in EU
standard format.
Cyprus is required to transpose the Directive
into its national law by July 2015 and ensure that
existing laws are amended to ensure compli-
ance with the Directive. The owners/operators of
planned well operations and production installa-
tion are required to ensure compliance with the
new rules concerning offshore safety from July 18,
2016. Existing installations will have to comply with
these new rules from July 18, 2017. This gradu-
ated approach gives owners/operators and member
states time to ensure full implementation, but
Cyprus needs to move ahead with transposition
rapidly.
Offshore Safety in the Eastern Mediterranean Energy Sector 5
A
t present, neither Cyprus nor Israel has
enacted environment and safety legisla-
tion that relates specifically to offshore
installations. Both countries have occupational
safety and health laws of a general nature dating
from the period of British rule. These laws provide
good coverage for traditional occupational safety
but have limited value for offshore risks. Regula-
tions concerning the safety of offshore activities
are fragmented and fall under the responsibility of
numerous government authorities.
Cyprus has ratified a number of international
conventions and, as an EU member state, has
transposed certain EU directives that are relevant
to offshore activities. Israel, however, has just begun
internal consultations among different government
departments with a view to adopting dedicated
offshore safety legislation and is not a signatory
to the relevant conventions. There is little public
interest in the topic despite vocal environmental
campaigns about the energy industry.
Tables 1 and 2 compare the status of various
conventions and laws relevant to offshore safety and
environment in Israel and Cyprus.
These tables show a rather fragmented legal frame-
work concerning offshore safety in both countries.
This legal patchwork still enables the governments
to impose safety and environmental protection
requirements on companies that are awarded explo-
ration and production licenses. These requirements
are set out in the license operation conditions for
each project. Given limited activity to date, this
case-by-case approach has been deemed sufficient.
In the future, however, as activities increase, both
countries will need a clearer, comprehensive, and
transparent framework concerning offshore safety
of oil and gas operations. In any event, Cyprus will
need to implement the provisions of the Directive
by 2015.
3
International Conventions and
National Regulations on Offshore
Safety in Israel and Cyprus
The German Marshall Fund of the United States 6
Table 1: International Conventions & Protocols
International Conventions & Protocols Israel status Cyprus status
The UN Convention on the Law of the Sea (UNCLOS)
a
Not signed or ratified
Some of its elements are
being applied, for example,
the EEZ agreement between
Cyprus and Israel
Signed in 1982 and
ratified in 1988
Convention for the Protection of the Mediterranean Sea
Against Pollution (The Barcelona Convention)
b
Madrid Protocol on offshore activities
Entered into force in 2005
Signed 1994 but not ratified.
Ministry of Environmental
Protection is an active
participant in the protocol
workgroup and is imple-
menting some of the protocol
requirements
Entered into force in
2004
Entered into force
2011. Enforced
by the Ministry of
Agriculture, Natural
Resources and Envi-
ronment
Convention on Environmental Impact Assessment in a Trans-
Boundary Context (Espoo, 1991), known as the “Espoo (EIA)
Convention”
The Espoo Convention sets out the obligations of Parties to assess
the environmental impact of certain activities at an early stage of
project. It also lays down the general obligation of States to notify
and consult each other on all major projects under consideration
that are likely to have a significant adverse cross-border environ-
mental impact.
Not signed or ratified Accession in 2000
The International Maritime Organization (IMO) has numerous
international conventions. The top three with importance and
relevance to hydrocarbons offshore safety are:
International Convention for the Safety of Life at Sea (SOLAS)
c
with its Code for the Construction and Equipment of Mobile
Offshore Drilling Units 2009 (MODU Code)
d
International Convention for the Prevention of Pollution from
Ships (MARPOL)
e
International Convention on Oil Pollution Preparedness,
Response, and Co-operation (OPRC)
f
Membership since 1952
Ratified
Ratified
Ratified
Membership since
1973
Ratified
Ratified
Not ratified
a
United Nations Convention on the Law of the Sea of December 10, 1982
b
Convention for the Protection of the Mediterranean Sea Against Pollution (Barcelona Convention)
c
International Convention for the Safety of Life at Sea (SOLAS), 1974
d
The Code for the Construction and Equipment of Mobile Offshore Drilling Units, 2009 (2009 MODU Code)
e
International Convention for the Prevention of Pollution from Ships (MARPOL)
f
International Convention on Oil Pollution Preparedness, Response, and Co-operation (OPRC)
Offshore Safety in the Eastern Mediterranean Energy Sector 7
Table 2: Cypriot & Israeli national laws relating to hydrocarbon offshore environment and safety
Scope Cyprus Status Israel Status
Granting of
hydrocarbon
prospection,
exploration,
and production
licenses
The Hydrocarbon Law No. 4 (I)/2007 and
Hydrocarbon regulation Nos. 51/2007 and
119/2009
g
derived from EU directive 94/22/EC.
The Ministry of Commerce, Industry, and
Tourism has the authority to grant hydrocarbon
licenses.
The Petroleum Law 1952
h
and its regulation
1953.
The Ministry of National Infrastructures, Energy,
and Water Resources has the authority to grant
hydrocarbon licenses.
Requirement to
Conduct Stra-
tegic Environ-
mental Assess-
ment (SEA) for
the EEZ
Assessment of Impact on the Environment
from Certain Plans and/or Programs Law (No.
102(I)/2005), which is harmonized with Direc-
tive 2001/42/EC,
i
better known as Strategic
Environmental Assessment (SEA) Directive.
The licensees are required to comply with the
SEA.
A Strategic Environmental Assessment (SEA)
Concerning Hydrocarbon Activities within the
Exclusive Economic Zone of the Republic of
Cyprus was conducted in 2008 by the Ministry of
Commerce, Industry, and Tourism.
There is no legal requirement to conduct Stra-
tegic Environmental Assessment. Legal require-
ment to conduct site specific environmental
impact statement relates to the building and plan-
ning law, which does not apply in the EEZ.
A strategic environmental assessment in Israel’s
EEZ is currently being conducted under the direc-
tion control and budget of the Ministry of National
Infrastructures, Energy, and Water Resources.
Provisions of
the hydrocarbon
laws relevant to
safety and envi-
ronment
The following matters are covered by current
legislation:
• Work practices
• Protection of the environment
• Contingency plan drilling practices
• Well abandonment
• Construction and maintenance of installation
pipelines, and related facilities
Article 82 of the Petroleum Law accords the
minister discretion to develop specific regula-
tions including those related to safety. Those
regulations have not been adopted to date.
The Petroleum Law gives the licenses granting
body the authority to request from the licensee
conditions to the work plan. The work plan is the
instrument by which safety and environmental
requirements are set individually in respect of
each license. Conditions may include the require-
ment to prepare an environmental impact assess-
ment report, an emergency planning abandon-
ment plan, etc.
The Ministry of National Infrastructures, Energy,
and Water Resources submitted the environ-
mental guidelines in December 2013 and the
safety guidelines for offshore oil and gas explora-
tions in January 2014 for public consultation.
These guidelines are derived from the Petroleum
Law.
g
Hydrocarbon (Prospection, Exploration, and Exploitation) Law of 2007 (No.4(I)/2007) and the Hydrocarbon (Prospection, Explora-
tion, and Exploitation) Regulations of 2007 and 2009 (No.51/2007 and No.113/2009), in Greek
h
The Petroleum Law 1952
i
Directive 2001/42/EC of the European Parliament and of the Council of June 27, 2001 on the Assessment of the Effects of Certain
Plans and Programmes on the Environment
j
Strategic Environmental Assessment (SEA) concerning Hydrocarbon Activities within the Exclusive Economic Zone of the Republic
of Cyprus
The German Marshall Fund of the United States 8
Scope Cyprus Status Israel Status
Environmental
regulations
Assessment of Environmental Impact from
Certain Projects Law (N. 140(I)/2005) (Euro-
pean Directive 85/337/EEC), for the exploration
drilling requires submission of a full Environ-
mental Impact Assessment (EIA) Study.
Competent Authority according to this law
is the Department of Environment, which
examines the report and provides terms that the
licensee is obliged to follow and comply.
There are currently seven management plans
under the environmental approval:
Contingency Plan for Hydrocarbon Leakage
and Fire
Mud and Offshore Discharge Plan
Waste Management Plan
Emergency Response Plan
Shipboard Oil Pollution Plan
A Safety Case
Plan for the Control and Monitoring of the
Environmental Parameters
Since 2012, The Prevention of Sea Pollution from
Land Origins Law 1988
k
and Regulation 1990
have served as the main instruments for moni-
toring and managing offshore environmental
performance of companies involved in oil and gas
explorations and production.
The Ministry of Environmental Protection
through its Marine and Coastal Environment
Division
l
issues discharge permits, which set
inter alia specific qualitative and quantitative
waste and mud discharge to the sea limits. The
permit requires the operator to conduct marine
environment background monitoring at the sea
bed and profiling of the water during operations.
The permit also imposes a requirement to report
in real time situations when prescribed limits
were exceeded. The division is also responsible
for setting the requirements reviewing the opera-
tor’s emergency preparedness plan for treatment
of oil spills, in accordance with Israel’s National
Contingency Plan for Preparedness and Response
to Combating Marine Oil Pollution.
m

General Occupa-
tional Health and
Safety
The Drilling Requirements for Safety and
Health at Work (extractive industries through
drilling) Regulation
n
of 2002 harmonized with
Directive 92/91/EEC
o
of November 30, 1992,
concerning the minimum requirements for
improving the safety and health of workers in
the mineral industries.
The responsible office is the Department of
Labor Inspection.
p
Work Safety Ordinance 1970
q
is the main law
relating to occupational safety. Drilling for
extraction of petroleum is included in the list
of activities governed by the law. There are no
specific provisions concerning onshore and
offshore drilling activities.
The responsible office is the Occupational Safety
and Health Administration within the Ministry
of Economy.
Vessel Safety
The responsible office is the Department of
Merchant Shipping.
Port regulations (vessel safety) 2008.
The responsible office is the Administration of
Shipping and Ports within the Ministry of Trans-
port and Road Safety.
k
Prevention of Sea Pollution from Land-Based Sources Law 1988
l
Israel Ministry of Environmental protection Marine and Coastal Environment Division
m
Israel’s National Contingency Plan for Preparedness and Response to Combating Marine Oil Pollution
n
The Drilling requirements for safety and health at work (extractive industries through drilling) Regulation 2002, in Greek
o
Council Directive 92/91/EEC of November 3, 1992 Concerning the Minimum Requirements for Improving the Safety and Health
Protection of Workers in the Mineral-Extracting Industries Through Drilling (11th individual Directive within the meaning of Article
16 (1) of Directive 89/391/EEC)
p
Republic of Cyprus Department of Labor Inspection
q
Work Safety Ordinance 1970
Offshore Safety in the Eastern Mediterranean Energy Sector 9
Comparison between the Provisions of the
Directive and the Current Legislative Framework
in Cyprus and Israel
T
he current patchwork of laws and regulations
in Israel and Cyprus contains numerous over-
laps and omissions. The overlaps may create
confusion, and the gaps could impose higher risks
on operators.
In both countries there is one government office
that has the authority for issuing licenses and that
also has the major responsibility for setting safety
and environmental requirements. In Cyprus it is
the Ministry of Commerce, Industry, and Tourism
and in Israel, the Ministry of Energy and Water.
Since these ministries are not responsible for all
matters concerning safety, an informal case by case
consultation of the various ministries and authori-
ties involved is carried out by the licensing body.
In Cyprus, the following government depart-
ments are involved in the consultative process:
the Cyprus Joint Rescue Coordination Center, the
Department of Fisheries and Marine Research,
the Department of Labor Inspection, the Depart-
ment of Merchant Shipping and Civil Defense,
the Department of Environment, the Cyprus Fire
Service, and the Geologic Department of Cyprus.
In Israel, the government departments involved are
the Marine and Coast Division of the Ministry for
Environmental Protection, the Ministry of Trans-
port (administration of shipping and ports), the
Ministry of Economy, and the Occupational Safety
Administration. This dispersion of responsibility
makes it difficult, in practice, to achieve the objec-
tives of the Directive.
There are no specific operational standards
imposed in either country on offshore oil and gas
operators. Instead, it is expected that companies
will implement industry best practices, as they do
in other parts of the world and as required by their
insurance contracts. The regulators have limited
responsibilities and resources for evaluating the
quality of safety plans submitted by companies.
There is no integrated risk-based approach deriving
from specific legislation regulating offshore
activities. The Directive was designed, in part, to
remedy these shortcomings in EU member states
by requiring them to appoint a single competent
authority to oversee the operator’s compliance with
the requirements of the Directive.
Streamlining Israel’s Safety Regulations
The Zemach Inter-Ministerial Committee
appointed by the prime minister in October 2011
examined the government’s policy regarding
natural gas in Israel.
2
In August 2012, the
committee provided its recommendations to the
Israeli government, but did not discuss the safety
and environmental aspects of the industry.
Offshore activity is widely perceived in Israel as
remote, and some regulators even question if it
falls under national jurisdiction. The concept of
setting up safety management systems, which is
a key element of the Directive, has only recently
been accepted in Israel. Companies will be legally
required to develop safety management plans in
Israel starting in August 2014.
Israeli experts and officials have drawn attention to
the benefits of adopting legislation along the lines
of the EU Directive. InAugust 2013, the European
Commission’s Technical Assistance Exchange
Office (TAIEX), in cooperation with the Israeli
Ministry of Transport, organized a workshop on
offshore safety with participants drawn from the
different government departments concerned. The
Ministry of Foreign Affairs has convened inter-
ministerial meetings to examine the implications of
the Directive.
On October 15, 2013, the Israel State Comptroller
included in his annual report a detailed chapter
on “Readiness and Preparedness for the Environ-
2
The Inter-ministerial Committee to Examine the Government’s
Policy Regarding Natural Gas in Israel
4
Comparisons and Implications
The German Marshall Fund of the United States 10
mental Impact of Off-shore Oil & Gas Drilling.”
3

The report criticized the lack of cooperation and
coordination between the Ministry of Environ-
mental Protection and the Ministry of Energy
and Water on offshore safety and environmental
protection. It called for a clear division of roles
and responsibilities and for the drawing up of clear
safety and environmental requirements for compa-
nies operating in the sector.
Following these different consultations and reports,
the Israel authorities seem to prefer to take the EU
Directive as a basis for a code of conduct rather
than for legislation. The adoption of a code of prac-
tice for safety in the industry is likely to be one of
the recommendations of the Public Committee set
up by the Ministry of Economy in 2011 to promote
occupational safety in Israel.
Multilateral and Bilateral Agreements
Israel has not ratified the UN Convention on
Law of the Seas (UNCLOS). It has, however,
concluded a number of bilateral and multilateral
agreements that contain provisions similar to
those of UNCLOS, including the 2010 Agreement
with Cyprus delimitating their respective EEZs.
4

Israel participates actively in the work of the 1976
Convention for the Protection of the Marine Envi-
ronment and the Coastal Region of the Mediterra-
nean (generally known as the “Barcelona Conven-
tion”).
The Barcelona Convention and its protocols
provide a broad legal framework for applying
safety and environmental requirements for offshore
oil and gas activities. The Barcelona Convention
entered into force for Israel in 2005. Israel rati-
fied the Dumping Protocol
5
in 1984, signed the
3
Israel State Comptroller report, in Hebrew
4
Agreement between the Government of the State of Israel and
the Government of the Republic of Cyprus on the delimitation
of the exclusive economic zone
5
Protocol for the Prevention of Pollution in the Mediterranean
Sea by Dumping from Ships and Aircraft
1976 Emergency Protocol
6
in 1978, and currently
uses the Land Based Sources Protocol
7
to regulate
discharge of waste from offshore installations. Israel
has signed all other protocols to the Barcelona
Conventions; however it has not yet ratified all of
them.
The 1994 Barcelona Offshore Protocol
8
entered into
force in 2011. The EU ratified this Protocol in 2013
and has brought the Directive into line with this
Protocol. Israel signed this Protocol in 1994, but
has not ratified it yet.
In the Eastern Mediterranean, the Protocol has
entered into force for Cyprus and Syria only.
Bilateral agreements between the EU and countries
in the Eastern Mediterranean provide a framework
that could facilitate the use of the Directive as a
blueprint for offshore safety legislation.
6
Protocol Concerning Cooperation in Preventing Pollution
from Ships and, in Cases of Emergency, Combating Pollution of
the Mediterranean Sea
7
Protocol for the Protection of the Mediterranean Sea against
Pollution from Land-Based Sources
8
Protocol for the Protection of the Mediterranean Sea against
Pollution Resulting from Exploration and Exploitation of the
Continental Shelf and the Seabed and its Subsoil
Table 3: Barcelona Offshore Protocol
Country Signature Ratifcation Entry into
force
Cyprus
November
14, 1994
May 16, 2006
March 24,
2011
European
Union
December
17, 2012/AC
February 27,
2013
-
Egypt - - -
Greece
October 14,
1994
- -
Israel
October 14,
1994
- -
Lebanon - - -
Syria
September
20, 1995
February 22,
2011
March 24,
2011
Turkey - - -
Offshore Safety in the Eastern Mediterranean Energy Sector 11
Lebanon, Israel, the Palestinian Authority, and
Egypt all have association agreements with the
EU including action plans as part of the European
Neighborhood Policy. While these agreements
do not cover offshore environment and safety in
particular, they cover general topics relating to
environmental protection in the Mediterranean and
maritime safety. The Directive forms part of the EU
acquis, which will be discussed within the frame-
work of these agreements.
As a candidate for EU membership, Turkey is
eventually expected to undertake commitments to
implement the Directive when it is discussed under
the appropriate chapter of the accession negotia-
tions. In practice, the slow pace of the negotiations
makes this obligation rather theoretical.
Another international platform that could serve as
a way to encourage regional collaboration between
the countries in the Eastern Mediterranean is the
Union for the Mediterranean
9
(UfM).
The bilateral relationship between Cyprus and
Israel probably provides the best framework for
cooperation on the adoption of the Directive as
a blueprint for the regulation of off-shore safety.
Since the Delimitation Agreement regarding the
EEZ was signed in 2010, the two countries have
signed security cooperation agreements, agree-
ments for collaboration in areas of energy effi-
ciency and renewable energy projects, agreements
to support each other in emergencies, and most
recently agreements to connect their national
electricity grids. The two countries are also working
on a unitization agreement for gas reservoirs that
straddle their maritime borders. Conclusion and
implementation of these different agreements is
likely to take a considerable time. An agreement to
9
The Secretariat of the Union for the Mediterranean was
created by 43 Euro-Mediterranean heads of state and govern-
ment in Paris on July 13, 2008. De-pollution of the Mediterra-
nean is one of its six main objectives.
cooperate on offshore safety and rapid intervention
would bring clear benefits to the industry.
Implications of EU Directive for U.S. Companies
Operating in the Region
The EU directive sets expectations and goals based
on global best practices for accident prevention
and for addressing the environmental conse-
quences of a major accident. It creates a regula-
tory framework, requires governments to set up
a single relevant authority and imposes reporting
requirements. Like the procedures under the EU
Directive, the new U.S. Safety and Environment
Management System focuses on elements such as
the risk assessment process, transparency, training
of staff, and reporting and auditing requirements.
10

The EU directive does not prescribe new technical
standards or impose an additional burden on U.S.
companies operating to Gulf of Mexico standards.
The EU directive could actually make business
easier for such companies. Should Israel decide
to adopt the EU offshore directive as a regulatory
framework, an informal code, a best practice, or
a law, it would provide consistency that would
benefit companies working on both sides of the
Cyprus Israel EEZ line. It would also simplify the
companies’ interactions with national authorities
as it requires the latter to set up a single regulatory
agency as a focal point on environmental and safety
issues.
10
30 CFR 250 Subpart S Safety and Environmental Management
Systems (SEMS)
The German Marshall Fund of the United States 12
C
ooperation between Cyprus and Israel
should be further developed to encourage a
consistent approach to regulation. One of the
areas for collaboration is in setting common opera-
tional standards, including those related to safety
and the environment. The Israel state comptroller’s
recent report points out the gaps in offshore safety
and environmental regulation and has raised public
and government awareness of the issue. These
developments provide a favorable climate for better
regulation of offshore safety.
While the geopolitics of the region remains
complex, cooperation between neighboring
countries in the Eastern Mediterranean could
bring benefits to all parties. These include building
capabilities for rapid intervention in the case of a
major accident. This effort could start by reviving
agreements for cooperation on oil spill emergency
response between Egypt, Cyprus, and Israel
11

concluded more than a decade ago. Instruments for
such cooperation include the Barcelona Convention
Prevention and Emergency Protocol and its opera-
tional body, Regional Marine Pollution Emergency
Response Centre for the Mediterranean Sea with
the collaboration of industry players.
11
Development of a Sub-Regional System for combating major
marine pollution incidents affecting or likely to affect the territo-
rial sea, coasts and other related interests of Cyprus, Egypt,
and Israel. This effort started in January 1993 and ended in
December 1995 funded by EU project LIFE-92-2/INT/02
The sharing of scientific data obtained from
the Strategic Environmental Assessment (SEA),
covering the EEZs of Cyprus, Lebanon, and Israel,
would bring benefits to all parties. Combining the
scientific data would provide a comprehensive
picture of the Levant Basin and would serve as
a starting point for the adoption of confidence-
building measures in the region. The UfM could
provide a useful framework for such cooperation.
Overall, the safety of offshore installations is a
promising field for regional cooperation. It is non-
political in nature and addresses common concerns
of all parties in the region. Energy companies will
benefit by facing a single, or at least compatible,
framework for safety requirements. Companies will
remain free to implement the standards specified
in their licenses, within the new regulatory frame-
work. Cooperation on offshore safety could also
be considered a confidence-building measure in
the context of long-standing conflicts. Confidence-
building measures in this field should be easier to
agree upon than in more sensitive political areas.
The European Union has a key role to play as a
catalyst for cooperation on offshore safety. The EU
needs to mobilize its different policy instruments,
including technical assistance and project finance,
to promote cooperation in this vital field. The
United States should also support this process, as
it has close relations with the countries concerned
and U.S. companies are involved in exploration and
production in the Eastern Mediterranean.
5
Conclusions
OF F I CE S
Washington • Berlin • Paris • Brussels
Belgrade • Ankara • Bucharest • Warsaw • Tunis
www.gmfus.org

Sign up to vote on this title
UsefulNot useful