OSHA: Severe penalties possible for upstream drilling & well-servicing firms
In February OSHA announced that employers engaged in crude petroleum and natural gas extraction, drilling and related support activities are engaged in “high hazard” activities and will be subject to OSHA’s Severe Violator Enforcement Program.
The program has been in effect since 2010, when it replaced the prior Enhanced Enforcement Program. When the program started, OSHA placed its national emphasis on the “high-hazard” industries that involved fall hazards and hazards from amputations; combustible dust, crystalline silica; excavation and/or trenching; lead; and shipbreaking. OSHA concentrates the majority of its resources to inspecting employers from “high-hazard” industries.
In his announcement, Tomas Galassi, director of enforcement programs at OSHA, said: “Going forward, a non-fatality inspection of an employer with the NAICS code 211111, 213111 and 213112 (Oil and Gas Production Services, Drilling and Well Servicing/”Upstream Oil and Gas Industry”) in which OSHA finds two or more willful or repeated violations or failure-to-abate notices (or any combination of these violations/notices), based on high gravity serious violations related to upstream oil and gas activities, will now be considered a severe violator enforcement case.”
Galassi noted that the policy “is targeted to upstream oil and gas drilling and well servicing employers based on their industry’s significant worker fatality rate over time,” and added that “over the last twenty years, upstream operations have experienced a fatality rate that has ranged from five to eight times greater than the national average for all U.S. industries.”
As a result, he said, OSHA “believes that a change in its SVEP policy related to upstream oil and gas drilling and well-servicing operations is warranted.”
Once an employer is designated a severe violator, OSHA may inspect other worksites of the employer. Also, the company must remain in the Severe Violator Enforcement Program for at least three years and maintain a clear OSHA record. After those three years, the company can petition OSHA and explain why it should be removed from the program.
OSHA also expects the severe violator to establish a safety program that could involve outside consultants and frequent follow-up visits by OSHA inspectors.
Criteria for removal from the SVEP are published in an Aug. 16, 2012, OSHA memorandum titled “Removal Criteria for the Severe Violator Enforcement Program.” In addition, all affirmed violations must have been abated, all final penalties must have been paid, the employer must have abided by and completed all settlement provisions, and the employer must not have received any additional serious citations related to the hazards identified in the SVEP inspection at the initial establishment or at any related establishments.