[Federal Register Volume 68, Number 140 (Tuesday, July 22, 2003)]
[Rules and Regulations]
[Pages 43295-43298]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-18451]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Part 250

RIN 1010-AC89


Oil and Gas and Sulphur Operations in the Outer Continental Shelf 
Documents Incorporated by Reference--API RP 14F and API RP 14FZ

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Final rule.

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SUMMARY: MMS is publishing this final rule to incorporate by reference 
into our regulations the 4th edition of American Petroleum Institute 
(API) Recommended Practice (RP) 14F (API RP 14F), ``Recommended 
Practice for Design and Installation of Electrical Systems for Fixed 
and Floating Offshore Petroleum Facilities for Unclassified and Class 
I, Division 1 and Division 2 Locations.'' The updated document, 4th 
edition, will replace the 3rd edition of API RP 14F, which is already 
incorporated by reference into MMS regulations. The final rule will 
also add another document to be incorporated by reference for the first 
time into our regulations. The new document, API RP 14FZ, 1st edition, 
is titled ``Recommended Practice for Design and Installation of 
Electrical Systems for Fixed and Floating Offshore Petroleum Facilities 
for Unclassified and Class I, Zone 0, Zone 1 and Zone 2 Locations.'' 
These revisions will ensure that lessees use the best available and 
safest technologies while operating in the Outer Continental Shelf 
(OCS).

EFFECTIVE DATE: This rule becomes effective on August 21, 2003. The 
incorporation by reference of the publication listed in the regulation 
is approved by the Director of the Federal Register as of August 21, 
2003.

FOR FURTHER INFORMATION CONTACT: David Nedorostek, Operations Analysis 
Branch, at (703) 787-1029.

SUPPLEMENTARY INFORMATION: We use standards, specifications, and 
recommended practices developed by standard-setting organizations and 
the oil and gas industry for establishing requirements for activities 
in the OCS. This practice, known as incorporation by reference, allows 
us to incorporate the provisions of technical standards into the 
regulations without increasing the volume of the Code of Federal 
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. The regulations, found at 1 CFR part 51, govern how MMS 
and other Federal agencies incorporate various documents by reference. 
Agencies can 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 or to the specific edition and supplement or 
addendum cited in the regulations.
    Both API RP 14F and API RP 14FZ are incorporated by reference at 30 
CFR 250.114. The requirements under this section apply only to 
platforms, artificial islands, fixed structures, and their facilities 
and not to electrical systems on floating facilities. Electrical 
systems on floating facilities are regulated by the U. S. Coast Guard 
(USCG). A Memorandum of Understanding (MOU) between MMS, U.S. 
Department of the Interior, and USCG, U.S. Department of 
Transportation, dated December 16, 1998, gave USCG the responsibility 
for electrical systems on floating facilities. Additionally, according 
to the MOU, USCG is responsible for aids to navigation, emergency 
lighting (standby lighting), survival craft, and general alarms, 
procedures for which, though included in both documents, are not under 
MMS regulations.
    We have reviewed these documents and have determined that the 
latest editions of both documents should be incorporated into MMS 
regulations to ensure the use of the best available and

[[Page 43296]]

safest technologies. The title of API RP 14F has been changed in the 
4th edition to conform with API RP 500, ``Recommended Practice for 
Classification of Locations for Electrical Installations at Petroleum 
Facilities Classified as Class I, Division 1 and Division 2,'' which is 
currently incorporated into MMS regulations. Our review shows that the 
changes between the old (3rd) edition and the new (4th) edition are 
minor. Most of the changes apply to floating facilities and are, 
therefore, not part of this rulemaking for the reasons cited above. 
Also, the 3rd edition is not readily available to affected parties 
because it is out of print. The oil and gas industry is already 
building new structures in accordance with the provisions of the 4th 
edition of this standard. The 4th edition has been revised using an API 
standard editorial format.

Summary of the Changes in the 4th Edition of API RP 14F Pertaining to 
Platforms, Artificial Islands, Fixed Structures, and Their Facilities

    In the 4th edition of 14F, several subsections that were contained 
in the 3rd edition have been consolidated into one subsection titled 
``Protection Techniques Related to Equipment Installed in Locations 
Classified as Division 1 and Division 2.'' This new subsection includes 
explosion proof equipment, hermetically sealed devices, intrinsically 
safe devices, nonincendive equipment, and purged enclosures. No new 
requirements were imposed.
    In the 4th edition of 14F, cable-shielding considerations have been 
added to the Electrical Distribution Systems section. This allows for 
the installation of metal clad cables in lieu of sealed conduits for 
electrical wiring. The use of metal clad cables could result in savings 
to industry of up to 40 percent over the use of sealed conduits and 
conventional wiring practices. Both methods of cable shielding provide 
for equal safety.
    Subsections have been added to the 4th edition of 14F to cover 
advances in technology in battery-powered DC supply systems 
(uninterruptible power supplies), electric oil-immersion heaters, 
cathodic protection, and hand-held electronic devices. These four new 
subsections cover equipment that is now in standard use on OCS 
structures, but that was not in the early 1990's when the 3rd edition 
was completed. These new subsections should not impose any new costs on 
the industry since operators are already using this equipment.

Review of API RP 14FZ

    The two recommended practices addressed by this rulemaking are 
nearly identical. The original version (14F) is to be used with the 
electrical classification system contained in API RP 500. This system 
of electrical classification differentiates locations by ``Divisions.'' 
This document (API RP 500) is already incorporated by reference into 
the regulations. A similar document, API RP 505, ``Recommended Practice 
for Classification of Locations for Electrical Installations at 
Petroleum Facilities Classified as Class I, Zone 0, Zone 1, and Zone 
2,'' is also currently incorporated by reference into the regulations. 
This system classifies hazardous locations by ``Zones'' based on how 
long a hazardous vapor is present. The new 14FZ document is to be used 
with API RP 505. The difference between the two pairs of documents, 
14F/500 and 14FZ/505, is that 14F/500 uses two ``Divisions'' to 
classify hazardous areas while 14FZ/505 uses three ``Zones'' to define 
these classified hazardous areas. The 14F document defines techniques 
for protection from fires in the Division system. The 14FZ document 
defines protection techniques in the Zone system for hazardous 
locations. Both systems provide for safe work environments for 
personnel. The protection techniques identified for the Division system 
are not all acceptable for the Zone system and vice versa. The Zone 
system identifies more protection techniques than the Division system; 
however, both systems have proven their safety by comparisons of both 
systems through the National Electrical Code, Factory Mutual, and 
Underwriters Laboratories. The operator could realize cost savings if 
the Zone system (14FZ/505) is used in classifying and designing 
electrical systems.
    We are incorporating the new 14FZ to complete the set of documents 
in the regulations and give lessees a choice in installing electrical 
systems. The incorporation of 14FZ will not impose any additional costs 
on the industry since it is nearly identical to RP 14F and may result 
in cost savings. The operators must use one set of documents or the 
other to design and install electrical systems on their facilities. The 
costs for complying with the documents are similar. We are merely 
giving the industry some flexibility with regard to classifying and 
installing electrical systems under either the API RP 500 system or the 
API RP 505 system.

Discussion and Analysis of Comments

    The updated document API RP 14F 4th edition and the new document 
API RP 14FZ were published as a proposed rule on January 14, 2003.
    Four organizations submitted comments on the proposed rulemaking. 
They are the (1) Shell Exploration and Production Company (Shell); (2) 
Waldemar S. Nelson & Co., Inc.; (3) Offshore Operators Committee (OOC); 
and (4) Department of Environmental Protection (Florida). All four 
commenters favor the incorporation of API RP 14F (4th edition) and 14FZ 
(1st edition).
    Shell supports the incorporation of API RP14F and 14FZ into MMS 
regulations.
    Waldemar S. Nelson & Co., Inc., strongly feel that incorporating 
the latest editions of API RP 14F and 4FZ enhances everyone's goal to 
provide for safer temporary and permanent electrical installations and 
more easily understood code wording, as well as enabling MMS rules to 
more closely reflect the latest code wording and philosophy of the 
National Electrical Code. All parties gain from this move as design and 
installation practices become more uniform and more economical without 
compromising safety. In many cases, safety is enhanced. By keeping up 
with the latest available technology and materials, offshore electrical 
installations can be designed to be more corrosion resistant than in 
the past.
    The OOC commends the MMS for incorporating industry standards into 
its offshore operating regulations to ensure the use of the best 
available and safest technologies on the OCS. The incorporation of 
these two documents ensures that MMS regulations remain current with 
present design and installation requirements and guidelines for 
electrical systems on offshore production facilities.
    The Department of Environmental Protection promotes the 
incorporation of API RP 14F and 14FZ into MMS regulations.

Procedural Matters

Public Comments 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 the law. There may be circumstances in which we 
would withhold from the rulemaking record a respondent's identity, as 
allowable by the law. If you wish us to withhold your name and/or 
address, you must state this prominently at the beginning of the

[[Page 43297]]

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.

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 effect of $100 million or more on 
the economy. It will not adversely affect in a material way the 
economy; productivity; competition; jobs; the environment; public 
health or safety; or State, local, or tribal governments or 
communities.
    The rule may have a positive economic impact because of the cost 
savings from using shielded cables in lieu of sealed conduits. 
Otherwise, the documents do not contain any significant revisions that 
will cause lessees or operators to change their business practices. The 
documents will not require the retrofitting of any facilities.
    (2) This rule will not create a serious inconsistency or otherwise 
interfere with an action taken or planned by another agency.
    (3) This rule does not alter the budgetary effects or entitlements, 
grants, user fees, or loan programs or the rights or obligations of 
their recipients.
    (4) This rule does not raise novel legal or policy issues.

Regulatory Flexibility (RF) Act

    The Department of the Interior (DOI) certifies that this final 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.). This 
rule applies to all lessees that operate on the OCS. Small lessees that 
operate under this rule would fall under the Small Business 
Administration's (SBA) North American Industry Classification System 
Codes 211111, Crude Petroleum and Natural Gas Extraction, and 213111, 
Drilling Oil and Gas Wells. The provisions of this rule will not have a 
significant economic effect on offshore lessees and operators, 
including those that are classified as small businesses. The SBA 
defines small business as having:
    [sbull] Annual revenues of $5 million or less for exploration 
service and field service companies.
    [sbull] Fewer than 500 employees for drilling companies and for 
companies that extract oil, gas, or natural gas liquids.
    The incorporation of API documents into MMS regulations cover 
electrical installations on offshore structures. The documents to be 
incorporated by this rule have been used by the industry for many 
years, and the latest editions represent state-of-the-art industry 
equipment and practices. The structures currently being built are being 
constructed according to the requirements in either API RP 14F (4th 
edition) or API RP 14FZ.
    The final rule's purpose is to update one document that is 
currently incorporated by reference in the regulations and to 
incorporate by reference a new, nearly identical document into the 
regulations. The differences between the newer document and the older 
document are very minor. The updated document consolidates several 
subsections in a new subsection covering protection techniques. In 
addition, cable shielding considerations were added to the updated 
document. This allows for the installation of metal clad cables in lieu 
of sealed conduits. The use of metal clad cables could result in 
savings to industry of up to 40 percent over the use of sealed conduits 
and conventional wiring practices. Other subsections have been added to 
the updated document to cover advances in technology. New subsections 
cover equipment that is now in standard use on OCS facilities, but that 
was not in use in the early 1990's when the older 3rd edition was 
completed and incorporated into the regulations. These new subsections 
should not impose any additional costs to industry since operators are 
already using this new equipment and technology. By incorporating both 
14F and 14FZ, which are nearly identical, but utilize different 
classification systems, we are giving the industry a choice in 
electrical classification methods.
    Under the North American Industry Classification System Code 
211111, Crude Petroleum and Natural Gas Extraction, MMS estimates that 
a total of 1,380 firms drill oil and gas wells onshore and offshore. 
The group affected by this rule is the approximately 130 companies that 
are offshore lessees/operators. According to SBA criteria, 
approximately 90 companies are small businesses (70 percent). As 
discussed above, this rule imposes no new operational requirements, 
reporting burdens, or other measures that would increase costs to 
lessees/operators, large or small. Therefore, this rule has no 
significant economic impact on small entities.
    Comments from the public are important to us. 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. You may 
comment to the SBA without fear of retaliation. Disciplinary action for 
retaliation by an MMS employee may include suspension or termination 
from employment with the Department of the Interior.

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 rule will not cause any significant costs to lessees or 
operators. The only costs will be the purchase of the new documents and 
minor revisions to some operating and maintenance procedures. The minor 
revisions to operating and maintenance procedures may result in some 
minor costs or may actually result in minor cost savings.
    (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) Does not have significant adverse effect on competition, 
employment, investment, productivity, innovation, or the ability of 
United States-based enterprises to compete with foreign-based 
enterprises.

Paperwork Reduction Act (PRA) of 1995

    This regulation does not require an information collection from 10 
or more parties, and a submission under the Paperwork Reduction Act is 
not required. An OMB Form 83-I is not required.

Federalism (Executive Order 13132)

    According to Executive Order 13132, the rule does not have 
significant Federalism effects. This rule will not substantially and 
directly affect the relationship between the Federal and State 
governments. This rule will simply update one document and add one 
document incorporated by reference to ensure that the industry uses the 
best and safest technologies. This rule does not impose costs on States 
or localities. Any costs incurred affect only the oil industry and will 
be minor.

[[Page 43298]]

Unfunded Mandate Reform Act (UMRA) of 1995 (Executive Order 12866)

    This rule does not impose an unfunded mandate on State, local, or 
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.

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.

Federalism (Executive Order 13132)

    According to Executive Order 13132, this rule does not have 
Federalism implications. This rule will not substantially or directly 
affect the relationship between the Federal and State governments 
because it deals strictly with technical standards that the offshore 
oil and gas industry must use in designing, fabricating, and installing 
fixed offshore facilities. This rule will not impose costs on States or 
localities, nor will it require any action on the part of States or 
localities.

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)

    This rule does not constitute a major Federal action significantly 
affecting the quality of the human environment. A detailed statement 
under the NEPA of 1969 is not required.

Consultation and Coordination with Indian Tribal Governments (Executive 
Order 13175)

    In accordance with Executive Order 13175, this rule does not have 
tribal implications that impose substantial direct compliance costs on 
Indian tribal governments.

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.

    Dated: June 23, 2003.
Rebecca W. Watson,
Assistant Secretary, Land and Minerals Management.

0
For the reasons stated in the preamble, MMS amends 30 CFR Part 250 as 
follows:

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

0
1. The authority citation for part 250 continues to read as follows:

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


0
2. In Sec.  250.114, paragraph (c) is revised to read as follows:


Sec.  250.114  How must I install and operate electrical equipment?

* * * * *
    (c) You must install all electrical systems according to API RP 
14F, Recommended Practice for Design and Installation of Electrical 
Systems for Fixed and Floating Offshore Petroleum Facilities for 
Unclassified and Class I, Division 1, and Division 2 Locations 
(incorporated by reference as specified in Sec.  250.198), or API RP 
14FZ, Recommended Practice for Design and Installation of Electrical 
Systems for Fixed and Floating Offshore Petroleum Facilities for 
Unclassified and Class I, Zone 0, Zone 1, and Zone 2 Locations 
(incorporated by reference as specified in Sec.  250.198).
* * * * *

0
3. In Sec.  250.198, in the table in paragraph (e), the entry for API 
RP 14F is revised and a new entry for document API RP 14FZ is added in 
alphanumeric order to read as follows:


Sec.  250.198  Documents incorporated by reference.

* * * * *
    (e) * * *

------------------------------------------------------------------------
                                              Incorporated by  reference
             Title of document                            at
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                              * * * * * * *
API RP 14F, Recommended Practice for Design  Sec.   250.114(c);
 and Installation of Electrical Systems for  Sec.   250.803(b)(9)(v);
 Fixed and Floating Offshore Petroleum       Sec.   250.1629(b)(4)(v).
 Facilities for Unclassified and Class I,
 Division 1 and Division 2 Locations, 4th
 edition, June 1999, API Stock No. G14F04.
API RP 14FZ, Recommended Practice for        Sec.   250.114(c);
 Design and Installation of Electrical       Sec.   250.803(b)(9)(v);
 Systems for Fixed and Floating Offshore     Sec.   250.1629(b)(4)(v).
 Petroleum Facilities for Unclassified and
 Class I, Zone 0, Zone 1 and Zone 2
 Locations, 1st edition, September 2001,
 API Stock No. G14FZ1.
 
                              * * * * * * *
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0
4. In Sec.  250.803, paragraph (b)(9)(v) is revised to read as follows:


Sec.  250.803  Additional production system requirements.

* * * * *
    (9) * * *
    (v) Fire- and gas-detection systems must be an approved type, 
designed and installed according to API RP 14C, API RP 14G, and either 
API RP 14F or API RP 14FZ (the preceding four documents incorporated by 
reference as specified in Sec.  250.198).
* * * * *

0
5. In Sec.  250.1629, paragraph (b)(4)(v) is revised to read as 
follows:


Sec.  250.1629  Additional production and fuel gas system requirements.

* * * * *
    (4) * * *
    (v) Fire- and gas-detection systems must be an approved type, 
designed and installed according to API RP 14C, API RP 14G, and either 
API RP 14F or API RP 14FZ (the preceding four documents incorporated by 
reference as specified in Sec.  250.198).
* * * * *

[FR Doc. 03-18451 Filed 7-21-03; 8:45 am]
BILLING CODE 4310-MR-P