[Federal Register Volume 66, Number 139 (Thursday, July 19, 2001)]
[Proposed Rules]
[Pages 37611-37615]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-18022]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Part 250

RIN 1010-AC-82


Oil and Gas and Sulphur Operations in the Outer Continental 
Shelf--Document Incorporated by Reference--American Petroleum 
Institute's Specification 2C for Offshore Cranes

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: MMS is proposing to incorporate by reference the Fifth Edition 
of the American Petroleum Institute's Specification for Offshore Cranes 
(API Spec 2C) into its regulations. MMS is proposing this action to 
establish a minimum design standard for new cranes installed on fixed 
platforms on the Outer Continental Shelf (OCS) and to require all 
existing cranes installed on OCS fixed platforms to be equipped with 
anti-two block safety devices. This proposed rule would ensure that OCS 
lessees use the best available and safest technologies for the design 
and construction of cranes used on the OCS.

DATES: We will consider all comments we receive by October 17, 2001. We 
will begin reviewing comments then and may not fully consider comments 
we receive after October 17, 2001.

ADDRESSES: Mail or hand-carry comments (three copies) to the Department 
of the Interior; Minerals Management Service; Mail Stop 4024; 381 Elden 
Street; Herndon, Virginia 20170-4817; Attention: Rules Processing Team 
(RPT). If you wish to e-mail comments, the RPT's e-mail address is: 
[email protected]. Reference API Spec 2C in your e-mail subject 
line. Include your name and return address in your e-mail message and 
mark your message for return receipt.
    Mail or hand-carry comments with respect to the information 
collection burden of the proposed rule to the Office of Information and 
Regulatory Affairs; Office of Management and Budget; Attention: Desk 
Officer for the Department of the Interior (OMB control number 1010-
NEW); 725 17th Street, NW., Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT: Wilbon Rhome, Industrial Specialist, 
Operations Analysis Branch, at (703) 787-1587 or Fax (703) 787-1555.

SUPPLEMENTARY INFORMATION: We use standards, specifications, and 
recommended practices developed by standard-setting organizations and 
the oil and gas industry as a means of establishing requirements for 
activities on the OCS. This practice, known as incorporation by 
reference, allows us to incorporate the provisions of technical 
standards into the regulations. The legal effect of incorporation by 
reference is that the material is treated as if it were published in 
the Federal Register. This material, like any other properly issued 
regulation, then has the force and effect of law. We hold operators/
lessees accountable for complying with the documents incorporated by 
reference in our regulations. We currently incorporate by reference 85 
private sector consensus standards into the offshore operating 
regulations.
    The regulations at 1 CFR part 51 govern how we and other Federal

[[Page 37612]]

agencies incorporate various documents by reference. Agencies may only 
incorporate by reference through publication in the Federal Register. 
Agencies must also gain approval from the Director of the Federal 
Register for each publication incorporated by reference. Incorporation 
by reference of a document or publication is limited to the specific 
edition, supplement, or addendum cited in the regulations.

Crane Standards

    The primary reason MMS is proposing to incorporate by reference API 
Spec 2C into its regulations is to establish detailed requirements for 
the design and construction of pedestal-mounted cranes for new and 
existing OCS fixed platforms.
    API Spec 2C will:
    a. Provide a uniform method of establishing rated loads for cranes.
    b. Require lessees to equip all new and existing cranes installed 
on OCS fixed platforms with anti-two block safety devices.
    c. Ensure that OCS lessees use the best available and safest 
technologies for design and construction of cranes for installation in 
the OCS.
    We believe API Spec 2C will be an excellent companion document to 
API Recommended Practice 2D, a document incorporated into MMS 
regulations, which deals with the operation and maintenance of offshore 
cranes. API Spec 2C includes minimum requirements for equipment, 
materials, manufacturing procedures, and testing (both design and 
operational) that are not covered in API RP 2D. Incorporating API Spec 
2C into the regulations would address a safety gap in our regulations 
and improve crane safety on the OCS.
    The anti-two block safety device is installed on a crane to protect 
hoist ropes, structural components, and machinery from damage, that 
might occur when two sheave groups (e.g., load block and boom head) 
come into contact as the hoist cable is drawn in. This situation is 
dangerous because: (1) The load block can detach from the load line, 
falling and causing serious injury or possible loss of life or 
considerable property damage, or (2) the load block can be pulled 
through the boom head, putting the crane operator at risk. There are 
several forms of anti-two block protection that are available to the 
oil and gas industry. One such form of protection is the control 
override device used to stall the hoist drums where damage or loss of 
control would be the result. Other forms of protection are audible or 
visual proximity warning devices. These anti-two block safety devices 
may be used in addition to the control override device, or used 
independently of the control override device.
    In the past, MMS has encouraged industry to equip all cranes 
operating on OCS fixed platforms with an anti-two block safety device 
regardless of age or specific use of the crane. MMS now believes that 
anti-two block safety devices must be used on all cranes installed on 
OCS fixed platforms. We are convinced that retrofitting existing cranes 
with the anti-two block safety devices will benefit the industry by 
increasing safety and reducing or eliminating crane incidents on the 
OCS. Industry shares our concern as evidenced by a recent safety alert 
issued by the International Association of Drilling Contractors, 
stating that anti-two block safety devices should be installed on all 
cranes because ``Having a safety device like this ensures that 
everything is in place to prevent a problem. The anti-two block safety 
devices for the crane boom is a protection device as is the crown 
protection device on the rig's drawworks. Both are very important to 
working safely.''
    It should be noted that the proposed regulation requiring the 
retrofitting of existing cranes would provide a 1-year transition 
period. This would allow the industry adequate time to implement this 
change without causing undue hardships.

Recordkeeping Requirements

    With the incorporation of API Spec 2C, we would include additional 
recordkeeping requirements in Sec. 250.108, consistent with the 
specification. Current regulations require you to keep at the OCS 
facility for at least 2 years the inspection, testing, and maintenance 
records of cranes and other material-handling equipment. The proposed 
regulations expand this to include maintaining records on the design 
and construction of cranes, including installation records for any 
anti-two block safety devices. We are also requiring that all records 
on cranes be retained for the life of the crane at the fixed offshore 
platform, rather than a minimum of 2 years.
    This proposed rule also updates Sec. 250.108 to specifically 
include retaining training records on rigger personnel, as well as 
those for crane operators. This is consistent with the API Recommended 
Practice 2D, Fourth Edition, which is already incorporated by reference 
in our regulations under Sec. 250.198.
    We specifically solicit comments on the following questions:
    (a) Will the addition of API Spec 2C to MMS's documents 
incorporated by reference increase safety and safe operations on the 
OCS?
    (b) Are there other standards for offshore cranes that may be 
appropriate for MMS to incorporate as part of MMS's regulations?
    (c) When should MMS require all cranes on OCS fixed platforms to be 
fully compliant with API Spec 2C?
    (d) Is a 1-year transition period enough time for industry to 
comply with the change proposed in Sec. 250.108(c)?
    (e) Should MMS establish a requirement similar to the U.S. Coast 
Guard (USCG), which requires cranes to be installed according to an 
approved crane plan and inspected and load tested by an Agency-approved 
third party when the crane is installed?
    (f) Should MMS require all new cranes for installation on OCS fixed 
platforms to have an API monogram on the nameplate of the crane as 
evidence of certification of the anti-two block safety device?
    (g) Should a rental crane that is installed on OCS fixed platforms 
be considered a new crane and, therefore, be required to be fully 
compliant with API Spec 2C?
    (h) Should MMS limit the type of anti-two block devices that are 
acceptable? What are the known failure rates of the different types?
    (i) Should MMS consider an additional cost factor for retrofitting 
existing cranes with the anti-two block safety device (e.g., an 
associated cost for the amount of time a crane is expected to be out-
of-service while it is being retrofitted)?

Procedural Matters

    The specifications in the API Spec 2C document we propose to 
incorporate by reference are currently widely accepted industry 
standards. The USCG has already incorporated API Spec 2C into its 
regulations. All cranes manufactured after 1983 came equipped with the 
anti-two block safety devices, and most earlier model cranes have been 
retrofitted with the anti-two block safety devices. Therefore, this 
regulation's impact on the entire oil and gas offshore industry is 
minor.

Public Comment Procedure

    Our practice is to make comments, including names and home 
addresses of respondents, available for public review during regular 
business hours. Individual respondents may request that we withhold 
their home addresses from the rulemaking record, which we will honor to 
the extent allowable by law.

[[Page 37613]]

There may be circumstances in which we would withhold from the 
rulemaking record a respondent's identity, as allowable by law. If you 
wish us to withhold your name and/or address, you must state this 
prominently at the beginning of your comment. However, we will not 
consider anonymous comments. We will make all submissions from 
organizations or businesses, and from individuals identifying 
themselves as representatives or officials of organizations or 
businesses available for public inspection in their entirety. We will 
summarize written responses to this notice and address them in the 
preamble of the final rule. All comments will become a matter of public 
record.

Regulatory Planning and Review (Executive Order 12866)

    This document is not a significant rule and is not subject to 
review by the Office of Management and Budget (OMB) under Executive 
Order 12866.
    (1) This rule will not have an annual economic effect of $100 
million or adversely affect an economic sector, productivity, jobs, the 
environment, or other units of government. A cost-benefit and economic 
analysis is not required. The major purpose for this proposed rule is 
to establish a minimum design standard for new cranes installed on 
fixed platforms on the OCS, and to address an increase in accidents for 
those cranes that are not equipped with anti-two block safety devices. 
This rule also proposes to require lessees to equip all existing cranes 
installed on OCS fixed platforms with anti-two block safety devices. 
Since API Spec 2C has already been accepted as an industry standard in 
most of the offshore community, including the USCG, the impact of this 
regulation on the entire industry is minor. Therefore, the associated 
costs to equip the remaining cranes, not previously retrofitted, with 
anti-two block safety devices will be minor. Based on our experience 
and information in MMS's Technical Information Management System, we 
estimate that about 5 percent (or a total of not more than 200) of the 
4,000 cranes located on the OCS will need to be retrofitted with the 
anti-two block safety device. We estimate that this will cost 
approximately $4,000 per retrofit, for a total cost of $800,000.
    (2) This proposed rule will not create inconsistencies with other 
agencies' actions. This rule will not affect how lessees or operators 
interact with other agencies.
    (3) This proposed rule will not affect entitlements, grants, user 
fees, loan programs, or their recipients. The rule only deals with the 
proposed action to incorporate by reference the API Spec 2C into our 
regulations.
    (4) This proposed rule will not raise novel legal or policy issues. 
The proposed rule does involve a new policy issue, to require the 
lessees to equip all new and existing cranes installed on fixed 
platforms with anti-two block safety devices, but this new policy 
decision is not ``novel.'' The proposed rule simply addresses 
recognized gaps in our safety regulations. These minimum requirements 
are generally accepted practices that are included in API documents.

Regulatory Flexibility (RF) Act

    The Department certifies that this rule will not have a significant 
economic effect on a substantial number of small entities as defined 
under the RF Act (5 U.S.C. 601 et seq.). An RF Analysis is not 
required. Accordingly, a Small Entity Compliance Guide is not required.
    The provisions of this rule will not have a significant economic 
effect on lessees and operators, including those that are classified as 
small businesses. The Small Business Administration (SBA) defines a 
small business as having:
     Annual revenues of $5 million or less for exploration 
service and field service companies.
     Fewer than 500 employees for drilling companies and for 
companies that extract oil, gas, or natural gas liquids.
    Offshore lessees/operators are classified under SBA's North 
American Industry Classification System (NAICS) code 211111 (Crude 
Petroleum and Natural Gas Extraction) and NAICS 213111 code (Drilling 
Oil and Gas Wells). We estimate approximately 130 companies will be 
affected by this rulemaking. According to SBA criteria, 39 companies 
are large firms, leaving up to 91 companies (70 percent) that may 
qualify as small firms with fewer than 500 employees.
    We estimate that about 5 percent of the 4,000 cranes (200) located 
on the OCS need to be retrofitted with anti-two block safety devices. 
Retrofitting an existing crane with an anti-two block system would cost 
approximately $4,000. As 70 percent of the businesses operating on the 
OCS are small business firms, a corresponding 70 percent of the 200 
cranes to be retrofitted would most likely impact small entities. The 
cost to small entities to retrofit these 140 cranes with anti-two block 
safety devices to comply with this standard is estimated to be $560,000 
(140 x $4,000 = $560,000.) This does not constitute a significant 
impact upon a substantial number of small entities, and the safety 
benefits should far outweigh the cost of retrofitting. It should be 
noted that this would be a one-time cost during the initial period of 
implementation and will not be a recurring expense.
    This proposed rule applies to all lessees and operating companies 
that operate cranes on OCS fixed platforms. Incorporation of this new 
document into MMS regulations will:
    (1) Increase safety.
    (2) Provide the oil and gas industry with uniform guidelines and 
detailed requirements for design and construction of pedestal-mounted 
cranes for OCS fixed platforms.
    (3) Provide for consistency with other regulatory agencies such as 
the USCG.
    Your comments are important. The Small Business and Agriculture 
Regulatory Enforcement Ombudsman and 10 Regional Fairness boards were 
established to receive comments from small businesses about Federal 
agency enforcement actions. The Ombudsman will annually evaluate the 
enforcement activities and rate each agency's responsiveness to small 
business. If you wish to comment on the enforcement actions of MMS, 
call toll-free (888) 734-3247.

Small Business Regulatory Enforcement Fairness Act (SBREFA)

    This rule is not a major rule under 5 U.S.C. 804(2), SBREFA. This 
rule:
    (a) Does not have an annual effect on the economy of $100 million 
or more. The proposed rule will not cause any significant costs to 
lessees or operators. The only costs will be the purchase of the API 
Spec 2C document, minor revisions to company operating procedures, and 
the installation of an anti-two block device on cranes installed on OCS 
fixed platforms that do not already have this safety device. These 
costs should be approximately $800,000 for the entire industry.
    (b) Will not cause a major increase in costs or prices for 
consumers, individual industries, Federal, State, or local government 
agencies, or geographic regions.
    (c) Will not have a significant adverse effect on competition, 
employment, investment, productivity, innovation, or the ability of 
U.S.-based enterprises to compete with foreign-based enterprises. This 
rule applies to lessees and contractors operating cranes on OCS fixed 
platforms.

Paperwork Reduction Act (PRA) of 1995

    The proposed rule requires information collection, and an 
information collection request (form

[[Page 37614]]

OMB 83-I) has been submitted to OMB for review and approval under 
section 3507(d) of the PRA.
    The title of the collection of information for this proposed rule 
is ``Proposed Rulemaking, 30 CFR 250, Subpart A--Crane Requirements.'' 
Potential respondents are approximately 130 Federal OCS lessees and 
operators. Responses to this collection of information are mandatory. 
The frequency of response is on occasion. This collection does not 
include proprietary information or questions of a sensitive nature.
    Current regulations at Sec. 250.108 include recordkeeping 
requirements for the testing, inspection, and maintenance of cranes 
installed on fixed platforms on the OCS. They also include 
recordkeeping requirements to document training of crane operators. The 
proposed rule expands the current recordkeeping requirements to include 
records on crane design, construction, and retrofitting. Records on 
training of rigger personnel, as well as crane operators, will also be 
required. The type of recordkeeping addressed in the proposed rule is 
most likely a usual and customary business practice, and the burden to 
make the records available for MMS review would be minimal. We estimate 
an additional 2 hours per respondent each year for the expanded 
recordkeeping requirements, for a total of 260 annual burden hours. MMS 
uses the information to determine that crane operations are safe and 
that crane operators and rigger personnel meet the physical 
qualifications and have completed appropriate training.
    As part of our continuing effort to reduce paperwork and respondent 
burdens, MMS invites the public and other Federal agencies to comment 
on any aspect of the reporting burden in the proposed rule. You may 
submit your comments directly to the Office of Information and 
Regulatory Affairs, OMB. Send a copy of your comments to MMS. Refer to 
the Addresses section for mailing instructions. MMS will summarize 
written comments and address them in the final rule preamble. The PRA 
provides that an agency may not conduct or sponsor, and a person is not 
required to respond to, a collection of information unless it displays 
a currently valid OMB control number. OMB is required to make a 
decision concerning the collection of information contained in these 
proposed regulations between 30 to 60 days after publication of this 
document in the Federal Register. Therefore, a comment to OMB is best 
assured of having its full effect if OMB receives it by August 20, 
2001. This does not affect the deadline for the public to comment to 
MMS on the proposed regulations.
    a. We specifically solicit comments on the following questions:
    (1) Is the proposed collection of information necessary for MMS to 
properly perform its functions, and will it be useful?
    (2) Are the estimates of the burden hours of the proposed 
collection reasonable?
    (3) Do you have any suggestions that would enhance the quality, 
clarity, or usefulness of the information to be collected?
    (4) Is there a way to minimize the information collection burden on 
those who are to respond, including the use of appropriate automated 
electronic, mechanical, or other forms of information technology?
    b. In addition, the PRA requires agencies to estimate the total 
annual reporting and recordkeeping non-hour cost burden resulting from 
the collection of information. We have not identified any and solicit 
your comments on this item. For reporting and recordkeeping only, your 
response should split the cost estimate into two components: (1) The 
total capital and startup cost component, and (2) annual operation, 
maintenance, and purchase of services component. Your estimates should 
consider the costs to generate, maintain, and disclose or provide the 
information. You should describe the methods you use to estimate major 
cost factors, including system and technology acquisition, expected 
useful life of capital equipment, discount rate(s), and the period over 
which you incur costs. Capital and startup costs include, among other 
items, computers and software you purchase to prepare for collecting 
information; well control simulators, and testing equipment; and record 
storage facilities. Generally, your estimates should not include 
equipment or services purchased: before October 1, 1995; to comply with 
requirements not associated with the information collection; for 
reasons other than to provide information or keep records for the 
Government; or as part of customary and usual business or private 
practice.

Federalism (Executive Order 13132)

    According to Executive Order 13132, this rule does not have 
Federalism implications. This rule does not substantially and directly 
affect the relationship between the Federal and State governments 
because it concerns the manufacturing requirements for specific 
equipment used in offshore oil and gas activities. The rule only 
affects manufacturers and users of such equipment. This rule does not 
impose costs on State or localities, as it only affects manufacturers 
and users of specific equipment used in offshore oil and gas 
activities.

Takings Implication Assessment (Executive Order 12630)

    According to Executive Order 12630, this rule does not have 
significant Takings implications. A Takings Implication Assessment is 
not required.

Civil Justice Reform (Executive Order 12988)

    According to Executive Order 12988, the Office of the Solicitor has 
determined that this rule does not unduly burden the judicial system 
and meets the requirements of sections 3(a) and 3(b)(2) of the Order.

National Environmental Policy Act (NEPA) of 1969

    This rule does not constitute a major Federal action significantly 
affecting the quality of the human environment. A detailed statement 
under the NEPA is not required.

Unfunded Mandates Reform Act (UMRA) of 1995

    This rule does not impose an unfunded mandate on State, local, and 
tribal governments or the private sector of more than $100 million per 
year. The rule does not have a significant or unique effect on State, 
local, or tribal governments or the private sector. A statement 
containing the information required by the UMRA (2 U.S.C. 1531 et seq.) 
is not required.

Government-to-Government Relationship With Tribes

    According to the President's memorandum of April 29, 1994, 
``Government-to-Government Relations with Native American Tribal 
Governments'' (59 FR 22951) and 512 DM 2, we have determined that there 
are no effects from this action on federally recognized Indian tribes.

List of Subjects in 30 CFR Part 250

    Continental shelf, Environmental impact statements, Environmental 
protection, Government contracts, Incorporation by reference, 
Investigations, Mineral royalties, Oil and gas development and 
production, Oil and gas exploration, Oil and gas reserves, Penalties, 
Pipelines, Public lands--mineral resources, Public lands--rights-of-
way, Reporting and recordkeeping requirements, Sulphur development and 
production, Sulphur exploration, Surety bonds.


[[Page 37615]]


    Dated: June 26, 2001.
Piet deWitt,
Acting Assistant Secretary, Land and Minerals Management.
    For the reasons stated in the preamble, the Minerals Mangement 
Service proposes to amend 30 CFR Part 250 as follows:

PART 250--OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER 
CONTINENTAL SHELF

    1. The authority citation for part 250 continues to read as 
follows:

    Authority: 43 U.S.C. 1331, et seq.

    2. In Sec. 250.108, the following changes are made:
    A. Revise paragraph (a) as set forth below.
    B. Redesignate paragraph (b) as paragraph (e).
    C. Add new paragraphs (b), (c), (d), and (f) as set forth below.


Sec. 250.108  What requirements must I follow for cranes and other 
material-handling equipment?

    (a) If you operate a crane installed on a fixed offshore platform, 
you must follow the American Petroleum Institute's Recommended Practice 
for Operation and Maintenance of Offshore Cranes (API RP 2D).
    (b) If you install a new crane on a fixed offshore platform, the 
new crane must meet the requirements detailed in the American Petroleum 
Institute's Specification for Offshore Cranes (API Spec 2C).
    (c) You must equip a crane, installed on a fixed offshore platform 
before [Date 30 days after the date of publication of the final rule], 
with an anti-two block safety device by [Date 1 Year and 30 days after 
the date of publication of the final rule].
    (d) You must maintain records specific to a crane or the operation 
of a crane installed on a fixed offshore platform, as follows:
    (1) Keep the qualification records of the crane operator and all 
rigger personnel at the fixed offshore platform for at least 4 years; 
and
    (2) Keep all design, construction, inspection, maintenance, and 
testing records, including installation records for any anti-two block 
safety devices, for the life of the crane at the fixed offshore 
platform.
* * * * *
    (f) For information on all standards mentioned in this section, see 
Sec. 250.198.
    3. In Sec. 250.198, the following document incorporated by 
reference is added to the table in paragraph (e) in alphanumerical 
order.


Sec. 250.198  Documents incorporated by reference.

* * * * *
    (e) * * *

------------------------------------------------------------------------
                                                        Incorporated by
                 Title of documents                      reference at
------------------------------------------------------------------------
 
                  *        *        *        *        *
API Spec 2C, Specification for Offshore Cranes,        Sec.  250.108(a),
 Fifth Edition, April 1, 1995, API Stock No. G02C05.                (b).
 
                  *        *        *        *        *
------------------------------------------------------------------------

[FR Doc. 01-18022 Filed 7-18-01; 8:45 am]
BILLING CODE 4310-MR-U