EUROPEAN UNIVERSITY INSTITUTE Department of Law BEHIND THE MASK REGULATING HEALTH AND SAFETY IN BRITAIN’S OFFSHORE OIL AND GAS INDUSTRY Thesis submitted for assessment with a view to obtaining the degree of Doctor of the EUl John PATERSON Supervisor: Prof Gunther Teubner Florence (Italy), May 1997 EUROPEAN UNIVERSITY INSTITUTE 3 0001 0025 9150 3 EUROPEAN UNIVERSITY INSTITUTE Department of Law BEHIND THE MASK REGULATING HEALTH AND SAFETY IN BRITAIN’S OFFSHORE OIL AND GAS INDUSTRY Thesis submitted for assessment with a view to obtaining the degree o f Doctor of the EUI John PATERSON Supervisor: Prof. Gunther Teubner Florence (Italy), May 1997 Behind the Mask Regulating Health and Safety in Britain's Offshore Oil and Gas Industry Contents Acknowledgements v Abstract vi Chapter 1 - Regulating and Evaluating 1 I, The Development of the Law Relating to Health and Safety at Work Offshore.............................2 1. Introduction................................................................................................................................ 2 2. The Background to the Prescriptive Regulatory Regime in the UK.......................................5 3. The Prescriptive Regulatory Regime....................................................................................... 8 4. Beyond the Prescriptive Regulatory Regime.....................................................................16 II. External Evaluations of the Law.......................................................................................................... 20 1. Carson - The Other Price of Britain's Oil...........................................................................21 2. Wright - 'Routine Deaths: fatal accidents in the oil industry'................................................. 23 3. Tombs - 'Piper Alpha - A Case Study in Distorted Communication*................................25 4. Woolfson, Foster & Beck - Paying for the Piper: Capital and Labour in Britain's Offshore Oil Industry........................................................................................................................27 HI. Evaluating the Evaluations....................................................................................................................29 1. The Economic Analysis of Law.........................................................................................30 2. Regulatory Capture, Containment and Accommodation..................................................... 33 IV. Moving Beyond Existing Evaluations...........................................................................................38 1. At the Limits of Modernity.......................................................................................................38 2. Behind the Mask................................................................................................................... 41 Chapter 2 • Mapping a New Approach 43 I. Looking for a New Approach. ...44 1. Coming to Terms with Complexity................... ...44 2. Standard Models of Law's Development............. ...46 3. A New Model....................................................... ...49 4. Autopoiesis.......................................................... ...51 5. Autopoiesis and Regulatory Failure.... ....... 6. The Limits of Law......................................... ....... 56 7. Overcoming the Limits. ....58 8. Reflexive Law................. .59 H. Mapping a Methodology. ........62 1. Getting the Bearings. ....62 2. Maps of Misreading............................ ........64 3. Cognitive Mapping........................ 4. Mapping Methodologies.................... ........69 HI. Some Technical Issues............................ 73 1. Autopoiesis......................................... ........73 2. Cognitive Mapping........................ ........75 3. Autopoiesis and Cognitive Mapping. ........77 Chapter 3 - A Long Decade of Determinism 78 I. Introduction..............................................................................................................................................79 II. Political Considerations..........................................................................................................................82 1. Introduction..................................................................................................................................82 2. From Legal Formalism to Legal Instrumentalism....................................................................84 JU. Mapping Management..............................................................................................................................89 1. The Essentials of Petroleum.......................................................................................................89 . 2. Mapping the Essentials..........................................................................................................96 3. Essentials in Action.....................................................................................................................100 4. Mapping Interventions............................... 109 (i) Finance........... .................................................................................................................109 (ii) Taxation........... ....................................................... 115 (iii) Participation.................................................................................................................... 120 (iv) Depiction Policy..........................................................................................................124 (v) Contractors and Trade Unions........................................................................................ 125 5. The Essentials Confirmed............................. 129 IV. Engineering in the North Sea..................................................................................................................133 1. Introduction...................................................................................................................................133 2. Conservad ve Determinism......................................................................................................... 137 3. Pressures towards a Probabilistic Approach........................................................................140 V. Developing and Implementing the Regulations.............................................................................146 1. Introduction................................................................................................................................... 146 2. Adapting to Complexity.............................................................................................................146 VI. Conclusions........................................................................................... 151 Chapter 4 - The Road to a New Rationality 156 I. Introduction.................................................................................................................. 157 n. Prices and Markets.................................................................................................................................... 158 1. After the Second Shock......................................................... .............................................. 158 2. The Possibility of Price Risk...... ....................................................................................... 163 HI. Health and Safety at Work.................................. 167 IV. Taxation, Participation and Depletion Policy........................................................................................ 169 1. Introduction................................................................................................................................... 169 2. The 1979 Oil Shock............................................................................................................... 170 3. Converging Constructions.......................................................... 174 V. Politics and Health and Safety....................................................................................... 178 VI. Engineering................................................................................................ 180 1. The Second Oil Shock..................................... 180 2. The Advent of Risk Assessment................................................................................................182 3. Competing Constructions...........................................................................................................189 VH. Regulation................................................................................................................................................. 195 Vffl. The 1986 Price Collapse.......................................................................................................................... 198 1. Introduction............................................................. 198 2. The Response of Industry Management.....................................................................................201 (i) The Risk-Oriented Response.................................................. 202 (ii) The Deterministic Response................................................................................... 204 3. The Response of Engineering...............................................................................................211 IX. Piper Alpha.....................