Digital Chemical Inventory Solutions Help Oil and Gas Industry Respond to Regulatory Changes
Most oil and gas companies would agree that the public has mixed feelings toward the industry. On the one hand, oil production and resulting byproducts (gasoline, jet fuel and diesel) are an important component in decreasing the cost of transportation and shipping. On the other hand, the products produced by the oil and gas companies, and the chemicals used to extract and create these products tend to be incompatible with our environment and have the potential to cause significant damage if they are not handled appropriately. The public appears to be willing to tolerate this balance, as long as the industry maintains proper chemical safety standards.
However, as the industry changes and evolves, oil and gas companies are encountering new situations for which chemical safety standards have not yet been established. As the public also encounters these situations, there has been a new demand for updated safety standards. Companies still relying on the old pen and paper method of chemical safety tracking and compliance will soon discover that conditions are changing too frequently to continue using outdated methods. In order to be responsive within this new operating environment, oil and gas companies need to begin implementing digital chemical tracking solutions.
There are two main benefits gained with digital chemical tracking solutions. First, any data is in digital format, meaning that it is easily transferable among systems or individuals. Also, digital solutions provide automated capabilities, so that tasks once completed manually may be done automatically.
To illustrate the versatility of a digital solution in addressing changing chemical safety compliance standards, let’s examine two developing regulatory issues that oil and gas companies will soon have to address:
Two weeks ago, U.S. crude production rose to 70,000 barrels a day, an amount that has not been produced in the last 28 years. However, all of this production has exposed a new problem – the U.S. does not have the infrastructure in place to efficiently transport such large amounts of oil from the field to the refinery via trucking methods. The result has been an increase in the amount of oil shipped by rail.
Transporting oil by rail seems like a good idea. However, a number of cities and towns along many railway paths have lodged complaints with railroad officials, oil and gas companies, as well as the Department of Transportation, citing a lack of communication regarding the contents of the trains passing through their communities. The concern is that local authorities and workers will not know how to respond if and when a train accident occurs.
In response, the Department of Transportation issued an order that oil and gas companies shipping by rail will have to notify cities of the contents of each rail car. For companies that are still using paper and pencil to track chemical contents, compliance will be difficult to achieve.
However, for companies that have implemented a digital solution, like a chemical inventory management system, for tracking their chemicals, safety compliance will most likely be fairly easy. The necessary information is already stored within the system, and since the data is digital, it can then be printed out or transferred electronically in whatever format the receiving parties prefer. A digital solution, like Accelrys CISPro, ensures that safety compliance costs are kept low, and there is minimal effort to put forward in producing new reports.
Another developing industry compliance situation emerged on May 9, 2014, when the U.S. Environmental Protection Agency released an Advanced Notice of Proposed Rulemaking request that companies disclose the chemicals they use in the fracking process. According to the proposed rules, oil and gas companies would need to submit documentation with details regarding all of the chemicals they use to extract oil and gas.
Similar to the new transportation requirements, companies not tracking fracking chemical information or are only filing the information away in a cabinet drawer will not be suitably prepared when the safety compliance rules are adopted. However, companies that are currently tracking their fracking chemicals using a digital chemical management system will be able to disclose the contents of each chemical without any difficulty. More importantly, the entire reporting process can be automated, saving companies both time and money.
Chemical safety regulations within the oil and gas industry are constantly changing. To stay in compliance, oil and gas companies will need to be adaptive and responsive when shifts occur. The best way to obtain this agility is to implement a chemical management system. For more information regarding the benefits of a digital chemical inventory management system, such as Accelrys CISPro, in the oil and gas industry, please visit our website today.