Rafael Parrilha
Director General
Bureau Veritas
View from the Top

Deepwater Risk Management

Tue, 01/22/2013 - 17:58

Q: How have regulations for risk management in deepwater progressed in Mexico to date?

A: At the end of 2011, the National Hydrocarbons Comission (CNH) published its first deepwater regulations which require that all companies prove that they are ready to operate in deepwater, and are prepared for the challenges they will face throughout the lifecycle of a deepwater project. We started to develop this regulatory framework with Pemex at the beginning of 2012.

Q: Which standards were taken from international best practices, and which were created specifically for the Mexican market and the needs of Pemex?

A: Bureau Veritas has a remarkable amount of experience accumulated since the beginning of exploration at deepwater fields. For our work on the Pemex regulatory framework for deepwater, we have used our strong network of specialists distributed around the world, but mainly in the countries with relevant experience in deepwater such as France, the UK, and Norway in the North Sea and Africa, Brazil for Latin America, and USA for the Gulf of Mexico. By leveraging our global deepwater expertise we were able to present Pemex with the latest international best practices for deepwater regulation available in the industry. By integrating these into a flexible benchmark Pemex is able to ‘tropicalize’ the international standards and best practices, incorporate its own best practices, and create a framework that fits the realities of deepwater operations in Mexico.

Our work did not consist of creating standards for Pemex; instead, we recommended that Pemex follows the international trends established by the IOCs in recent years, to search for an unification of standards into ISO standards, and to identify the critical areas where its important for Pemex to incorporate relevant requirements, which also creates a window to introduce technological innovation.

Q: How will the regulatory framework affect companies that will be working in deepwater with Pemex, in terms of their risks, liabilities, costs and strategies?

A: First of all, let me clarify that Pemex still has to implement this regulatory framework. As the regulatory framework was developed based on international benchmarks, it should represent important cost savings for the major players of the industry, since their main technologies already fit those standards. In terms of risks and liabilities, the framework incorporates the experience from the most relevant incidents that have occurred in recent years. Finally, the concept of flexibility will permit the major players to adopt a straightforward strategy to reach the universal objective of all companies in this business: to explore and produce as efficiently and safely as possible.

Q: How do you assess Pemex’s current attitude towards deepwater risk management? What are the biggest challenges that still need to be addressed?

A: In my opinion, Pemex is working very hard at risk management for all their assets, including those located in deepwater. This can be confirmed by several initiatives, such as the establishment of their own system for health, safety and environment. Besides, the strategic partnership signed with several international oil companies such as Repsol, Petrobras, and Total reinforce the message that Pemex is aiming to speed up its learning process to move towards deepwater by incorporating the experience accumulated by other companies. To reach its objectives, the main challenge for Pemex will be to reduce its internal bureaucracy that in many cases delays projects and increases costs, and also to reform its organization to allow the integration of the various Pemex organisms into a common homogenized business model.

Q: Deepwater development is a long-term goal for Pemex. What role does Bureau Veritas aspire to play as Pemex further develops its deepwater assets?

A: Based on our experience, we hope to be a major partner for Pemex. We are present in more than 140 countries. We have been in this business for a very long time, and a member of the International Association of Classification Societies for 180 years. We know the technology that has been applied at similar fields in Brazil, Africa, and in the US Gulf of Mexico. The intention of Bureau Veritas is to be one of the most important players and partners in helping Pemex to create a strong culture of safety and risk management.