Special Report Status of major NOIA programs:

James Day Former Chairman - NOIA President, Chairman & CEO, Noble Drilling While Washington's political landscape may have undergone dramatic change in the last year due to the 1994 November elections, NOIA's role on Capitol Hill has remained steadfast. During the last 12 months, NOIA has been aggressively pursuing efforts in several areas essential to gaining access to the OCS and improving the economic climate for NOIA members to do business in this country.

James Day
Former Chairman - NOIA
President, Chairman & CEO, Noble Drilling

While Washington's political landscape may have undergone dramatic change in the last year due to the 1994 November elections, NOIA's role on Capitol Hill has remained steadfast. During the last 12 months, NOIA has been aggressively pursuing efforts in several areas essential to gaining access to the OCS and improving the economic climate for NOIA members to do business in this country.

  • Continue area-wide leasing: In a long awaited and most welcome announcement, MMS Acting Director Cynthia Quarterman told NOIA that MMS will continue to hold annual areawide lease sales in the Central and Western Gulf of Mexico. She indicated MMS' analysis of industry's comments, the briefings provided by NOIA and others, and MMS' experience with NOIA's lease sale simulation, lead them to the conclusion that it would be a mistake to abandon areawide leasing in the Gulf.

    Since it was instituted in 1983, area-wide leasing has fostered robust competition in the Gulf of Mexico due to the program's consistency and predictability. NOIA's leadership in the discussions involving alternatives to MMS leasing policies and procedures proved successful in maintaining the program's success.

    NOIA's efforts helped bring to a close a nearly two-year-long deliberation on the issue of tract nomination versus area-wide leasing, during which the future of area-wide leasing was in doubt. Special thanks to the members of NOIA's Leasing Advisory Group and to those members who participated in the briefings and lease sale simulations. Thanks also to the many NOIA members who directed comments to MMS.

  • Less costly regulations: On another front, NOIA's work on regulatory improvement has made notable progress. Formed last year, the Regulatory Reform Task Force has been busy working toward making OCS regulations less expensive for industry to comply with and government to enforce, while still achieving the regulation's original objective. As part of its ongoing effort, the task force issued its first survey to members on the MMS regulations most in need of change that pertain to oil and gas operations on the OCS.

    Based on industry's responses, the task force selected four sections to research and analyze for presentation to the MMS. NOIA has already received a preliminary indication from MMS that they will consider at least two of the four sections being analyzed.

  • 1997-2002 leasing input: Regarding the 5Year Leasing Program for 1997-2002, our comments on the new program were well received, both by the administration and members of Congress. We have been meeting with MMS to urge them to take a more creative approach to the new five-year program than to simply offer portions of the OCS that are noncontroversial. We have also suggested to relevant members and staff on Capitol Hill that they give attention to both the moratorium issue and the 5-year leasing program, as the two issues in our view are inseparable.

  • Smithsonian's Ocean Planet exhibition: In an effort to change the public's sentiment toward offshore drilling, NOIA has been actively involved in the most ambitious outreach effort ever undertaken by the association sponsorship of the Smithsonian Institution's Ocean Planet exhibition.

    The Ocean Planet exhibit opens April 22 in Washington and affords NOIA and its members a variety of opportunities to inform the public, federal officials and others on the facts of the ocean industries' role in developing needed energy resources in a responsible way.

    NOIA's unfailing commitment to its members on the issues of access and economics will continue in 1995. The challenge for industry remains the same regardless of who is setting the agenda on Capitol Hill.

    DOMESTIC ENERGY ADVOCATES PROGRAM
    Don W. Jackson
    DEA Program Chair - NOIA
    Director of Market Alliances - Baker Hughes

    Program focus

    The Domestic Energy Advocates (DEA) program provides the offshore industry with a unified voice that can and does affect legislative decisions in Washington DC. District Advocates (DA's), participants in the program, are notified when key issues affecting industry's business operations are being considered by Congress. A "Call to Action" is set in motion, and DA's begin alerting their respective Congressman by telephone and letter on the issue's legislative impact on industry.

    With some congressmen winning elections with margins as low as 20 votes in the 1994 November elections, constituents can expect to be heard by Washington's new lawmakers. In meetings with congressmen and their staffs, the importance of grassroots networking has been emphasized and reemphasized. With every new participant, DEA's voice grows stronger and louder, and NOIA, on behalf of its membership, takes another step toward reaching industry's goals.

    Gulf of Mexico program

    During the 103rd Congress, Domestic Energy Advocates played a key role in NOIA's successful campaign to inform members of Congress of industry's concerns with proposed Gulf of Mexico legislation. Letters from NOIA's District Advocates and the association's direct lobbying activities served to educate the congressional Gulf Coast delegation of the legislation's potential adverse impacts on the region's industries. The grassroots involvement was an essential element of NOIA's direct lobbying efforts in opposition to the advancement of any Gulf of Mexico proposal.

    ENVIRONMENTAL CONSERVATION & SAFETY COMMITTEE
    Dr. Aston Hinds
    ECSC Committee Chair - NOIA
    Vice President of Corporate Environmental, Health, and Safety Affairs - Dresser Industries

    The Gulf of Mexico program

    A central issue before the NOIA's Environment Conservation and Safety committee during the 103rd Congress was the Gulf of Mexico Program (GOMP). NOIA took a proactive role in educating both the Congress and allied trade groups on the GOMP legislation and the activities of the Environmental Protection Agency-led Gulf of Mexico Program.

    The association adopted a position opposing the introduction and advancement of any proposals seeking to legislatively establish a GOMP. In addition, NOIA was directed to work with congressional members of US Gulf Coast states to seek opportunities and mechanisms for directing federal funding to Gulf Coast state institutions and research facilities.

    Following a series of NOIA coordinated visits to the House and Senate Gulf Coast state delegations, industry was able to forestall any consideration, discussion or advancement of like legislation.

    NOIA believes the possibility of similar legislative activity in the 104th Congress is highly unlikely. NOIA's reasoning on this is due to a number of factors, namely the elimination of the Sunbelt Caucus, the legislative service organization that attempted to shepherd the measure through Congress last year.

    The 104th Congress' Gulf Coast delegation has been made aware of industry's concerns with past legislative proposals, and there has been considerable grassroots contact with the delegation expressing opposition to the advancement of any GOMP legislative proposal.

    The existing EPA-led GOMP program continues to focus its resources on a series of challenges which include reducing the rate of coastal wetlands loss, expanding public education and outreach efforts, and reducing the input of toxic substances into the Gulf of Mexico.

    Of interest to NOIA members is the recent establishment of a Business Advisory Council which will provide industry additional access and input to the management and policy functions of the existing Gulf program.

    NOIA will maintain a proactive approach to and work within the existing program. NOIA's charter membership, in a broad-based coalition of Gulf Coast industries and businesses, will provide additional opportunities to monitor the existing GOMP's work products and agenda, provide input, assistance and comment when necessary.

    Marine sanctuaries

    Near the close of the 103rd Congress, the House passed a bill to modify the boundaries of the Flower Garden Banks sanctuary (US Gulf of Mexico) and provide sanctuary designation for the nearby Stetson Bank. The ECSC Marine Sanctuaries Task Force expressed its opposition to this and any congressional intervention in the sanctuary designation process.

    NOIA suggested addressing the issue through a voluntary approach involving the states, the diving community and the federal government. Such an approach, NOIA argued, could serve to protect the bank without the need for additional regulation and legislation.

    ECSC's Marine Sanctuaries Task Force will monitor interest in the 104th Congress to designate the Gulf of Mexico Stetson Bank area as a marine sanctuary. The task force will also provide input to the National Oceanic and Atmospheric Administration (NOAA) marine sanctuary programs, publication, outreach, and research efforts.

    Senior Minerals Management Service (MMS) staff and personnel from the NOAA Office of Coastal Resource Management (OCRM) recently formed a marine sanctuaries core group to work in several project areas including:

    • Coordination between the MMS 5-Year leasing plan and the sanctuary site selection process
    • Policy decisions regarding the future of the High Island 389 facility
    • OCRM's examination of the MMS permit tracking database.

    ECSC will monitor MMS and OCRM work and will continue to address from a positive, pro-industry perspective, issues such as habitat improvement, artificial reef systems and the federal management of marine reserves, parks and sanctuaries.

    Natural resource damage assessments

    Industry's environmental liability and the standards for the assessment of natural resource damages caused by spills and releases of petroleum and hazardous substances are currently regulated by the Department of the Interior (DOI).

    Under the Oil Pollution Act of 1990 (OPA '90), however, the National Oceanic and Atmospheric Administration (NOAA) is required to regulate natural resource damage assessments (NRDA) for spills on, in and under navigable waters. Until NOAA finalizes its proposed regulations, the DOI regulations will cover Outer Continental Shelf operations.

    Last year, NOIA joined an association petition in the US Court of Appeals seeking a review of DOI's liability regulations that were issued in March of 1994.

    At the heart of industry's complaint is DOI's abandonment of any standards to ensure that environmental restoration measures are selected on the basis of cost-effectiveness. Industry also views the DOI rulemaking as setting a precedent and standard for NOAA's concurrent rulemaking efforts.

    NOAA's proposed regulations set out various assessment procedures to establish a dollar amount for natural resource damages for which responsible parties would be held liable. When finalized, these procedures will be available for use by government, state, and tribal trustees.

    NOIA joined with other trade groups in submitting comments on NOAA's proposed regulations. The comments stated that NOAA's proposed regulations would dramatically increase the costs associated with oil spills. Damage costs calculated with the proposed procedures would be extraordinarily high in some cases: up to $454,000 for a 10 gallon spill - and perhaps too low in other cases - $0 for a 50,000 gallon spill.

    NOAA's proposed regulations assert that contingent valuation (CV), an opinion survey method, is a reliable approach for measuring resource damages, although NOIA argued that available evidence regarding CV is mixed at best.

    There is no requirement under the NOAA proposal that respondents to CV surveys consider only injuries to natural resources that have resulted from a spill. NOIA argued that as a result, incorrect perceptions of damages to natural resources may be exaggerated by the public and possibly lead to inflated contingent valuation data.

    Industry's comments also argued that government, state, and tribal trustees will have virtually unlimited flexibility, and that the proposed rules will make it difficult for responsible parties to contest the trustee's decisions. Industry observed that despite a specific preclusion in OPA '90 for double recovery, the proposed regulations could allow separate recovery for resource damages by each trustee.

    In the 104th Congress, NOIA may see attempts by the environmental community to advance NRDA (natural resource damage assessment) amendments during consideration of certain environmental legislation. ECSC will continue to address issues with the implementation of the NRDA provisions of OPA '90.

    Ecosystem management

    ECSC monitored the Environmental Protection Agency's (EPA) efforts to advance ecosystem management within its program missions and policies. Last year, senior EPA officials produced the edgewater consensus document.

    The document contained a series of recommendations and strategies regarding reorientation of EPA's ecosystem management approach. The edgewater document recommended a change in focus from program-driven to place-driven. Under a place-driven orientation, EPA efforts would be established by the environmental needs of communities and ecosystems.

    In a follow-up memo to the administrator issued late last year, senior EPA officials noted that the ecosystem protection approach will address places that EPA wants to protect. Of particular interest to the ECSC membership is the recent EPA initiative taken to advance consideration and attention to the agency's existing Gulf of Mexico Program as a model ecosystem management program.

    In addition, NOIA monitored the establishment of a White House intergovernmental team on Ecosystem Management of over 20 participating agencies, including EPA, Fish and Wildlife Service, Office of Management and Budget, and the National Oceanic and Atmospheric Administration.

    Ecosystem management and watershed management policies may be proposed during the 1995 reauthorization of the Clean Water Act.

    EPA environmental auditing policy

    ECSC participated in public meetings held by the EPA's Office of Enforcement and Compliance Assurance to reassess the agency's policies regarding environmental auditing and self-evaluation.

    EPA has been collecting information needed to analyze any potential modifications to its existing 1986 Environmental Auditing Policy Statement. The policy affirms EPA's support for auditing as a measure to achieve and maintain compliance and to identify, resolve and avoid environmental problems.

    EPA has stated it does not intend to dictate or interfere with the environmental management practices of industry, nor does it intend to mandate auditing. Of concern, however, is EPA's comment that it will not forgo inspections, reduce enforcement operations, or offer other incentives in exchange for implementation of environmental auditing or other management practices.

    NOIA is tracking the 104th Congress' consideration of the Voluntary Environmental Self-Evaluation Act. Under the proposed measure a voluntary environmental audit that is made in good faith would not be admissible evidence in any legal action or administrative procedure under federal law. The measure would address any federal actions related to 11 environmental laws, including the Clean Water Act, the Clean Air Act, and the Oil Pollution Act of 1990.

    Toxic release inventory

    ECSC worked with other trade groups in responding to the EPA's planned increase in the number and scope of environmental data collection and dissemination mandates with which companies must comply. Among other things, the agency added more than 300 chemicals to the existing Toxics Release Inventory (TRI) chemical list and certain non-manufacturing facilities to the TRI program.

    In an issue paper prepared for a public meeting, EPA identified oil and gas extraction facilities for possible inclusion in the TRI program. If this occurs, the reporting of environmental release data for offshore oil and gas extraction facilities could focus additional public attention on these facilities.

    EPA has held several public hearings on its efforts to expand the universe of facilities that must report under the TRI program. The agency expects to issue a proposed rulemaking by the spring of 1995 and a final rulemaking in late 1995 or early 1996. The agency has not decided whether to propose the inclusion of exploration and production facilities.

    Synthetic drilling fluids

    ECSC continued its work with Congress and the Environmental Protection Agency (EPA) in the examination of the environmental and economic benefits of synthetic drilling fluid systems.

    At NOIA's request, an industry-agency discussion group (EPA, Department of Energy and Minerals Management Service) was formed to work toward resolution on several key issues central to formal EPA recognition of the technology. These issues include a definition of synthetic, the inverse emulsion prohibition, priority pollutant data, and toxicity data.

    Under NOIA's leadership, the Synthetic Drilling Fluid Industry Steering Group was established to craft a consensus work product that will be used to obtain EPA recognition of the new synthetic drilling fluid technology. The steering group includes representatives from both the Outer Continental Shelf service industry and offshore operators. At present, the group is submitting synthetics data and information to the EPA for consideration and action.

    Clean Water Act

    ECSC will seek to advance member interests regarding performance-based versus technology-based clean water standards, wetlands classification and mitigation measures, clean water enforcement provisions, and requirements for the utilization of risk assessment. ECSC will monitor EPA's efforts to administratively advance the concept of watershed management within the Clean Water Act reauthorization debate.

    The US House Transportation Committee has set an expedited schedule for reauthorization of the Clean Water Act. Committee Chairman Bud Shuster (R-Penn.) introduced last year's bipartisan initiative as a starting point for discussion. He remarked that legislative action will be developed from the hearing record and comments received from all interested parties.

    Under direction from Rep. Shuster, a series of congressional task forces have been established to manage key Clean Water Act issues that include: nonpoint source and watershed issues; point sources; funding and unfunded mandates; stormwater; and wetlands. The task forces will coordinate comments, facilitate consensus, and make final recommendations. Full committee action on the clean water bill is expected in April.

    Coastal Zone Management Act

    The committee will monitor the reauthorization of the Coastal Zone Management Act (CZMA), which is likely to be addressed by Congress later this year. With the changes in congressional committee structure and jurisdiction, CZMA will now be addressed within the House Resources subcommittee on Fisheries, Wildlife and Oceans.

    The subcommittee, chaired by Rep. Jim Saxton (R-N.J.) also maintains jurisdiction over marine sanctuaries, ocean engineering, oceanography, marine science, and general research and protection of coastal and marine environments. During the 103rd Congress, NOIA provided testimony on the consistency appeal process, simplification of CZMA's administrative procedures and Outer Continental Shelf lease sale consistency review.

    Endangered Species Act

    ECSC will work with a coalition of interests during this year's reauthorization of the Endangered Species Act (ESA). A congressional endangered species task force has been formed by House Resources Committee Chairman Don Young (R-Alaska).

    The task force, headed by Rep. Richard Pombo (R-Calif.) is planning a series of outside-the-beltway hearings between April and June. Young has said he will report an ESA reauthorization bill that includes property rights provisions by July.

    Safety issues

    ECSC's Safety Issues Subcommittee focuses on all issues where safety of life at sea is of concern. Topics before the subcommittee have included drug and alcohol testing, and Coast Guard licensing and manning proposals. Over the next two years, the subcommittee will continue to address the status and acceptance of the Minerals Management Service Safety and Environmental Management Program and related issues before the US Coast Guard's National Offshore Safety Advisory Committee.

    FINANCE COMMITTEE
    James B. Clement
    Finance Committee Chair - NOIA
    President & CEO - Offshore Logistics

    Unlike many other trade associations, NOIA's sole source of income is membership dues. The Finance Committee's responsibility is, in large part, to ensure that anticipated dues income is sufficient to meet expenses for the next 3-5 years.

    The dues increase implemented in 1994 was designed to meet those needs and create a small surplus, provided membership levels remain stable. An income goal of $1,097,000 was established and $1,089,000 actually collected in 1994. Several mergers and acquisitions within our membership resulted in dues losses. Those losses were offset, however, by the welcome infusion of revenue from new members, bringing us within $8,000 of our goal.

    Significant cost cutting initiatives and controls resulted in 1994 expenses being considerably under budget. Therefore the budget proposed and approved for 1995 has been reduced from 1994 levels. We will continue to look for ways to cut costs while ensuring quality service to our membership. NOIA's reserves are now approaching $1 million. Our goal is to maintain the association's financial stability. NOIA's management and staff remain committed to assuring that each dues dollar is used effectively to benefit our membership.

    GOVERNMENT AFFAIRS COMMITTEE
    Robert E. Sleet
    Government Affairs Committee Chair - NOIA
    Vice President & Treasurer - Global Marine

    Regulatory reform

    Regulatory reform will be a key issue for the foreseeable future. In the association's effort to streamline and simplify the regulations governing outer continental shelf (OCS) operations, NOIA formed the Regulatory Reform Task Force in 1994. The long term objective of the task force is to work toward a simpler, more efficient, and less costly federal regulatory climate for NOIA members.

    The Regulatory Reform Task Force works under the auspices of GPAC with representation from the Environmental Conservation and Safety Committee (ECSC).

    The committee is co-chaired by Carver Richards of Phillips Petroleum Company, representing GPAC, and Chuck Bedell of Murphy Exploration & Production Company, representing ECSC.

    The first step has been to identify those regulations that are especially burdensome or inefficient through member company surveys. The task force began by issuing a survey in November of 1994 that covered Title 30, Part 250 of the Code of Federal Regulations. These are the Minerals Management Service's (MMS) offshore regulations pertaining to oil, gas, and sulfur operations.

    In January, the task force met in Houston to review the survey responses and decided to prepare research papers on the prioritized issues for presentation to MMS. The papers will include:

    • Brief summary of each regulation's requirements and objectives
    • Statement with supporting arguments for changing the regulation
    • Precise language to effect the change
    • An estimate of savings should the suggested changes be adopted by the MMS.

    The task force will be discussing the first survey with MMS in the near future, and will then advance to the next regulatory area of concern for industry.

    The OCS leasing program

    The Leasing Advisory Group will play an active role this year as the Minerals Management Service (MMS) begins preparation of a new offshore natural gas and oil leasing program. The current 5-year leasing program expires in 1997.

    In response to MMS' call for comments on the new Five Year Leasing Program for 1997-2002, NOIA, after a thorough review by the Leasing Advisory Group, submitted its comments. NOIA urged MMS not to be satisfied with a stand pat approach in preparation for the new program.

    NOIA asked the agency to look beyond simply including non-controversial areas like the Central and Western Gulf of Mexico and consider allowing the leasing program to move into locations that offer greater opportunities but are currently covered with restrictions.

    In the past, however, a major barrier to expanding the leasing program has been the solid opposition by local communities - defiance that has been loudly heard by Washington lawmakers. In an effort to resolve conflicts with local communities over OCS development, MMS proposed the establishment of an alternative dispute resolution (ADR) program. MMS would collaborate with local interests directly affected by OCS development, including environmental groups and state and local governments, to create opportunities for a wider range of creative solutions and possible options in the resolution of disputes.

    While the program has not yet been fully established, NOIA noted in its leasing comments to MMS that such a program could be used as a means for testing local attitudes about limited future lease sales in promising OCS areas. MMS' ADR approach, if established, could bring about positive change on future leasing decisions.

    A key educational tool used by NOIA to educate Congress and the administration on the federal leasing program is the OCS lease sale simulation. The simulation is an interactive role-playing exercise in which players are called on to make the same types of decisions that a potential bidder at an OCS lease sale must make. NOIA will continue to use this tool to help those who make and impose the rules on offshore leasing understand the impact on our industry and ultimately on government revenues.

    Outer Continental Shelf incentives

    Two types of incentives have been proposed to improve the economics of oil and gas exploration and development in deep water areas of the Gulf of Mexico. The first, proposed by Sen. J. Bennett Johnston (D-La.) would provide royalty relief for certain production in water depths in excess of 200 meters. The royalty holiday would continue in place until predetermined volumes of oil or natural gas are produced from the property in question. These volumes vary depending on water depth.

    The second, proposed by Sen. John Breaux (D-La.), would provide a $5/bbl production tax credit for new oil and gas production in water depths greater than 400 meters. Legislation similar to both of these proposals was introduced in the last Congress, and both were the subject of hearings. We expect additional hearings sometime during the 104th Congress. Breaux has also introduced legislation permitting producers to expense geologic and geophysical costs associated with studying subsurface conditions to locate hydrocarbon structures. It has been proposed these costs be treated as an expense for tax purposes.

    The Oil Pollution Act of 1990

    Strict implementation of the provisions of the Oil Pollution Act of 1990 (OPA'90) has the potential to seriously damage the interests of a number of NOIA members. The law, enacted in the aftermath of the 1989 Prince William Sound oil spill, seeks to guarantee clean-up and damage compensation costs are met.

    There are a number of troubling provisions in the statute including:

    • Definition of offshore facilities
    • $150 million certificate of financial responsibility requirement
    • Absence of an exclusion from very low risk facilities
    • Requirement that one who certifies financial responsibility be regarded as a guarantor for clean-up costs and damages.

    Industry had hoped that the Minerals Management Service (MMS) would solve some of these problems in the course of developing its regulations. However, a December opinion delivered by the Interior Department's solicitor made it clear that if these problems are to be solved, involvement by Congress will be required.

    NOIA is currently working with allied trade associations to develop a consensus approach to solving the OPA'90 problems. Our OPA'90 Review Committee will be asked to review and comment on proposed solutions as well as on a strategy for moving ahead. When MMS issues a Notice of Proposed Rulemaking regarding compliance with OPA'90 for offshore facilities, the committee will play a major role in formulating a response.

    MEMBERSHIP COMMITTEE
    R. L. Howard Membership Committee
    Chair - NOIA
    Vice President of Domestic
    Operations E & P - Shell Oil

    Membership recruitment

    NOIA's membership continues to grow. More NOIA members have become involved in the work of the Membership Committee. For the second consecutive year, the goal of $70,000 in new member revenue has been surpassed.

    Since the 1994 NOIA annual meeting, the membership committee has welcomed the following companies into NOIA membership:

    Apache Corporation
    Aquila Energy Resources
    Arethusa Off-Shore Company
    Carbo Ceramics, Inc.
    Caterpillar Inc.
    Coastal Fluid Technologies, Inc.
    Delta Energy Management, Inc.
    Fluor Daniel Inc.
    Francis Drilling Fluids, Ltd.
    Forcenergy Gas Exploration Inc.
    Gulf Star Holdings, Inc.
    Kvaerner, Inc.
    LeTourneau, Inc.
    Marathon Oil Company
    Meridian Oil, Inc.
    Newpark Resources, Inc.
    RMSL Traffic Systems, Inc.
    SBM Drilling Fluids
    Universal Ogden Services
    Walter Oil & Gas Corporation
    W&T Offshore, Inc.

    In addition to recruiting new members, the committee continues to reach out to members who could receive more value from their membership by becoming more involved in association activities.

    Communication services

    Membership communication and services is the program through which the NOIA staff receives its mandate on issues and messages, and allows the staff to keep the membership continually informed through its various publications and meetings.

    The association's biweekly newsletter, The Washington Report, includes information on legislative and regulatory activities, media relations efforts, meetings and programs and action calls to mobilize the grassroots network. Other publications include biannual Reports to the Membership, an annual Membership Directory and several brochures. NOIA hosts two major meetings each year allowing industry leaders to meet and discuss common problems. The fall meeting, held last October in Austin, Texas, enjoyed the highest attendance in NOIA history. Regional workshops and committee and subcommittee meetings continue to be held throughout the year.

    Looking ahead

    Looking ahead, NOIA will again have a booth at the Offshore Technology Conference (OTC) in Houston in early May. During the course of the conference, the NOIA staff will visit with prospective members and schedule a number of off-site visits in the Houston area.

    The tradition of participating in an OTC press conference will be continued. NOIA will increase the number of visits to members throughout the year, and hold two membership breakfasts to welcome new members and solicit potential members.

    NOIA is making every effort to find new ways of communicating with and involving members in the work of the association. The group prides itself on providing a high level of service and response to the membership and solicits suggestions from all members on how to improve that service. NOIA is recognized as a strong voice for the ocean industries. With continued support, NOIA will become stronger.

    PUBLIC AFFAIRS COMMITTEE
    Jere D. Smith
    Public Affairs Committee Chair - NOIA
    Director of Media Relations - Phillips Petroleum

    Outreach programs

    To accomplish its objective, the Public Affairs Committee determines key audiences that have an impact on government policies and industry's business climate. Effective programs and tools that will communicate industry's message to targeted audiences, giving industry an opportunity to improve its image instead of simply being in a reactive mode, are then developed and initiated.

    The Ocean Planet exhibition

    In an effort to address the public's opposition toward offshore drilling, the Public Affairs Committee, during the last year, has been actively involved in promoting the most ambitious outreach program ever undertaken by NOIA - sponsorship of the Smithsonian Institution's Ocean Planet exhibition. The Ocean Planet is a multi-million dollar exhibit about the productivity, pollution, and conservation of the world's oceans.

    Visitors will be able to see that oil in the waters from offshore exploration and production is five times less than that caused by natural seeps. This will be illustrated in a hands-on dip-stick arrangement that will enable the public to discover for themselves what the sources of oil pollution are and their degree of responsibility. The information in the exhibit supports arguments NOIA has been making for years regarding industry's environmental record.

    The Ocean Planet exhibit represents one of the largest multi-year initiatives in the Smithsonian's history, and will reach more than 6 million Americans through the exhibit at the Institution, the national tour, related publications, multidisciplinary educational programs, and an electronic online companion. The exhibit will open on Earth Day, April 22, in Washington at the Smithsonian Institution's National Museum of Natural History.

    Since August of 1993, the Media Committee has been aggressively pursuing NOIA sponsorship of the Ocean Planet exhibition.

    At the request of the committee's executive committee liaison, Ray Galvin of Chevron USA, a subcommittee was formed in April 1994 to look more closely at the contents of the entire exhibit to determine its objectivity and to determine whether industry would have the opportunity to offer input into the process.

    Sponsorship goal reached

    Following final approval by the Executive Committee in June of 1994 that NOIA serve as a financial sponsor, the Media Committee embarked on a $100,000 fundraising effort. To encourage membership involvement, newsletter articles and information kits underscoring the benefits of the Ocean Planet for the offshore industries were given widespread distribution to NOIA members.

    Presentations promoting NOIA's sponsorship were made at NOIA's Legislative Strategy Group meetings, committee meetings, and membership visits. In late October, after thorough examination of the script and considerable discussions with Smithsonian representatives and NOIA staff, the subcommittee voted in favor of NOIA continuing efforts for Ocean Planet sponsorship. By the end of March, NOIA finally reached its $100,000 sponsorship goal through voluntary contributions from member companies.

    Media and lobbying activities planned

    Plans are now underway for briefings, breakfasts and private tours of the exhibit for the media, Congress and administration officials. NOIA will be conducting editorial board briefings at tour sites around the country to communicate industry's environmental message and economic contributions.

    The association's sponsorship of the Ocean Planet is sure to be at the center of the committee's activities for years to come, as the exhibit will tour 11 cities through 1999.

    Not only will the exhibit serve to heighten the public's awareness of the industry's excellent environmental record, but the Ocean Planet will provide a unique opportunity for industry to tell its story in an unprecedented manner through a very credible and respected third party.

    The NEED project

    NOIA President Bob Stewart has recently assumed the chairmanship of the National Energy Education Development (NEED) Project for the next two years. The Public Affairs Committee believes NEED's non-biased program offers industry a unique opportunity to educate the nation's decision makers of tomorrow on the facts about offshore drilling.

    As part of the program, a pre and post survey is conducted to measure the knowledge and opinions of participants. Survey results have shown a greater number of students being supportive of offshore drilling and an even greater number being undecided on the issue rather than opposed.

    Launched in 1980 by congressional resolution, NEED is now a dynamic force in more than 5,000 schools nationwide. NEED's hands-on activities encourage students to teach themselves and others about energy in innovative ways designed to foster the development of leadership and critical thinking. As chairman of NEED, Stewart's initial focus has been to financially strengthen the NEED program by broadening its support base to include as many allied trade associations as possible.

    During October of 1994, NOIA staff met with Pat Godley, assistant secretary of fossil fuels, Department of Energy (DOE), to introduce DOE to the NEED program. Since then, NOIA staff has conducted meetings with representatives from the Natural Gas Supply Association and the Independent Petroleum Association of America to develop strategies for increased industry interest and support across the country.

    TELECOMMUNICATIONS POLICY COMMITTEE
    Richard J. Williams
    TPC Chair - NOIA
    Vice President - John E. Chance & Associates

    Consortium for Oceanographic Research and Education

    In 1994, NOIA's Telecommunications Policy Committee (TPC) accepted an invitation to serve on a steering committee that will guide an initiative addressing ocean sciences and technology.

    The initiative, which is being coordinated by the Consortium for Oceanographic Research and Education, will respond to challenges contained in the National Research Council Report, "Oceanography in the Next Decade: Building New Partnerships." The committee includes representatives from federal agencies, the academic community and industry.

    Specifically, the steering committee is charged with:

    • Directing efforts concerning partnerships on ocean data management and education
    • Technology development in the ocean sciences
    • Opportunities for sharing these technological resources
    • The transition from research activities to activities supporting operational concerns. Representing NOIA on the steering committee are Ocean Sensing Subcommittee Chairman Jim Blankenship, Martin-Marietta Astro-Space; Keith Vickery, Sonardyne, Inc. and Roy Johnson, Mobil Research and Development Corporation. The ocean sensing subcommittee will continue to participate and monitor the progress of the steering group in 1995.

    National technical policy

    Working in cooperation with NOIA's Environmental Conservation and Safety Committee, TPC represented NOIA at a White House Conference held last fall to examine the development and commercialization of environmental technologies. The conference, chaired by Vice President Al Gore and members of the cabinet, was organized to build upon the partnership efforts of the public and private sectors and guide the development of a National Environmental Technology Policy.

    The conference agenda was based upon the report "Technology for a Sustainable Future: A Framework for Action," released by the vice president last summer. The report outlines a series of strategic directions, current initiatives and possible steps that could be taken to promote the development and diffusion of environmental technologies.

    NOIA participated in a number of working group meetings that provided information to the White House Conference. NOIA provided comments on:

    • Opportunities to utilize offshore platforms for scientific research
    • Ability of the offshore industry to assist federal agencies in meeting program responsibilities through partnership arrangements
    • The regulatory barriers now in existence that prohibit the advancement of new technologies.

    NOAA advanced short-term forecasts and warning service

    Through its Ocean Sensing Subcommittee, NOIA submitted formal comments to the National Weather Service regarding the Advanced Short-Term Forecasts and Warning Service initiative. The initiative is part of the National Oceanic and Atmospheric Administration's (NOAA) strategic plan that will guide the agency's programs and missions through the year 2005.

    One of the overall goals of the initiative is to advance observations and short-term predictions for all the environment. In its comments, NOIA recommended the inclusion of all ocean areas within the forecasts and warnings initiative. NOIA also endorsed the initiative's review of the opportunities and benefits awaiting industry, government and academia through the establishment of public-private partnerships.

    NOIA expressed strong concerns, however, with the related administration efforts being taken to converge the existing NOAA Civil Weather Satellite Program with the Military Satellite Program and the NASA Earth Observation Research Satellite Program.

    The offshore industry's stated concerns are directed toward possible degradation in real-time marine warnings and forecasts and the potential adverse budgetary impact on NOAA programs that could result from a convergence of the civilian, military and research satellite systems. The Ocean Sensing Subcommittee will continue to monitor the modifications made to the NOAA strategic initiative and provide input and comment when necessary.

    Augmented global positioning service

    TPC will also track the Department of Transportation's (DOT) proposal regarding a federally supported augmentation of the Global Positioning System (GPS) and its potential impact on private sector service providers. The ocean industries support dual use (civil and military) of the Department of Defense's (DOD) navigational satellite system for positioning exploration and production activities offshore.

    In response to a joint DOD-DOT task force report on GPS, a study was conducted to determine the optimum integrated approach to augmented GPS services to meet the needs of federal users. Included in the recommendations is a statement calling on DOT to plan, install, operate and maintain an expanded local area differential GPS (DGPS) system for land and marine users.

    The US Coast Guard is now installing a coastal system of DGPS beacon transmitters, in part to satisfy a federal mandate for 8-20 meter accuracies for harbor approaches and entry.

    Preceding this federal effort, NOIA member companies have developed services on a regional basis to augment GPS to achieve 1-3 meter accuracies required for offshore operations. These commercial and competitive services have substantially reduced the costs of positioning offshore operations.

    The government has, through the DOD-DOT Task Force Report, proposed a publicly funded solution for a problem that can be met by commercially available services. The government's augmented GPS services initiative will threaten the existence of private sector services and result in an estimated cost to the US taxpayer of $1.6 billion.

    NIA supports the role of government agencies in providing integrity monitoring and quality control of contracted commercial services to meet FRP requirements. However, NOIA believes that reliance on government furnished DGPS services will stifle technical innovation in developing further commercial enhancements in positioning services.

    Nautical charting

    TPC's Navigation and Positioning Subcommittee will continue its focus on the nautical charting function of the National Oceanic and Atmospheric Administration (NOAA). Jim Baker, NOAA administrator, and Stan Wilson, assistant administrator for the National Ocean Service, have commented that NOAA coastal charts are more than five years out-of-date. With 43,000 miles of US coastline to survey and the limited capability to survey roughly 1,000 miles of coastlines per year, NOAA is finding itself in an increasingly difficult situation.

    Baker and Wilson have been receptive to NOIA's proposals that call on greater utilization of private sector technologies and capabilities in acquiring nautical charting data. The Navigation and Positioning Subcommittee will continue to support such an arrangement before both the administration and Congress during the NOAA appropriations process. NOIA believes the agency's charting and mapping missions can be accomplished through private sector contracts in a more timely and cost-efficient manner.

    With the change in the committee structure in the US Congress, jurisdiction for NOAA's nautical charting program will now reside in the Transportation and Infrastructure Committee. The new Congress is receptive to proposals featuring less government, budget savings. and private sector involvement. NOIA intends on using this opportunity to push for action on improving the NOAA nautical charting mission through greater private sector involvement.

    Communications Act of 1934

    The outlook for amending the radio equipment and carriage requirements of the Communications Act of 1934 appears promising. The International Convention for the Safety of Life at Sea (SOLAS), adopted following the sinking of the Titanic, required ships and coast stations to maintain a continuous Morse radiotelegraphy listening watch.

    Until the Global Maritime Distress and Safety System (GMDSS) was adopted by the world maritime community in 1988, use of Morse radiotelegraphy as the primary distress system remained relatively unchanged.

    The advanced GMDSS technology simplifies the radio operations mandated under SOLAS, ensures redundancy of safety communications, enhances search and rescue operations, and with the maritime safety broadcasts, minimizes unanticipated emergencies at sea. In effect, the GMDSS replaced antiquated Morse alerting technology with a worldwide ship-to-shore alerting capability.

    The Coast Guard has discontinued its watchkeeping of Morse code services due to the superior safety communications benefits of the GMDSS system. Yet, the Federal Communications Commission (FCC) has not modified its position that the GMDSS specifications are simply an extension of those requirements (Morse) presently in force.

    This means US vessels are required to meet the new GMDSS requirements in addition to the dated Morse radiotelegraphy and radio officer carriage requirements. FCC has indicated it will not initiate changes to these requirements until changes to the Communications Act of 1934 are made by Congress.

    Sen. Larry Pressler (R-S.D.), has introduced a discussion draft containing a "pro-competitive, deregulatory national policy framework for telecommunications reform legislation." Pressler, who is chairman of the Senate Commerce Committee, noted that his draft is designed to "accelerate private sector deployment of advanced telecommunications and information technologies and minimize, remove and reform regulations."

    The movement on Capitol Hill related to telecommunications reform provides an opportunity to change the manning and equipment carriage provisions that are keeping US vessel operators at a competitive disadvantage with international operators. NOIA will work with other maritime trade groups interested and active in seeking such changes.

    Global Ocean Observing System

    The Global Ocean Observing System (GOOS) was conceived as an internationally coordinated system for ocean observations, driven by user needs for:

    • Improvements in climate forecasting
    • Assessment of the status and health of the marine environment
    • Development of applied products and services to support coastal managers in their decision making.

    GOOS provides a framework for the systematic collection of observational data, timely exchange of data and information, and the incorporation of data into predictive models and technology transfer.

    The GOOS effort in the United States is being lead by the National Oceanic and Atmospheric Administration (NOAA) through five work groups: (1) climate monitoring, (2) marine living resources, (3) health of the ocean, (4) marine meteorological and oceanographic operational services, and (5) a cross cutting group addressing the coastal zone environment.

    The work groups include representation from all the federal agencies, the coastal states, and the academic community. NOIA, as the sole industry representative, has been participating on the coastal zone work group.

    The group is working to prepare a statement on its work product goals and objectives and an interagency budget proposal to support the US GOOS effort.

    TPC's Ocean Sensing Subcommittee will continue to participate within the GOOS coastal work group and will monitor the work agendas and products of the other efforts and their potential impact on offshore oil and gas exploration and production.

    Weather satellite convergence

    The TPC continues its monitoring of the government's activities related to the convergence of the Department of Defense's (DOD) military weather satellite system (DMSP) with the National Oceanic and Atmospheric Administration's (NOAA) polar weather satellite system (TIROS).

    The primary driver has been a belief that a single satellite program would save money. In reality, NOIA has argued that the savings have never been significant when the impacts to these programs are considered.

    In April of 1994, NOIA adopted a resolution opposing the convergence initiative and has taken that message to Congress and the administration. TPC is vitally interested in the survival of the civil NOAA polar weather satellite program. The program provides global information on which 3-5 day forecasts are based.

    These forecasts have provided a significant savings to the marine and OCS industries by providing a level of advanced notice and protection against severe weather events. The program also performs the search and rescue mission over the entire globe. This function alone is vital to the safety of the maritime and OCS industries.

    The Ocean Sensing Subcommittee will provide comments during the NOAA appropriations process on the ocean industries' concerns relative to the convergence initiative.

    Access and cost of environmental data

    The National Oceanic and Atmospheric Administration (NOAA) published on December 28, 1994 a schedule of new and revised fees for access to NOAA environmental data and information. NOAA announced that it normally will follow a policy of providing information at cost of dissemination. NOAA will follow this policy except where otherwise permitted by the Office of Management and Budget or directed by statute.

    TPC supports the present NOAA position regarding the availability of important environmental data. NOIA members are able to obtain access to the data for a nominal fee and further process the environmental information into value-added products. Of concern to the TPC membership has been the European community's possible adoption of a unified position calling for increases in access charges for environmental data.

    Copyright 1995 Offshore. All Rights Reserved.

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