ORDER OF THE MINISTER OF ENERGY, INDUSTRY AND TRADE OF THE REPUBLIC OF KAZAKHSTAN

of July 9, 1999 No. 185

About approval of the specifications and technical documentation on oil and gas industry

In pursuance of the order of the Government of the Republic of Kazakhstan of June 5, 1996 "About approval of the Regulations on procedure for carrying out the sea scientific research connected with oil operations at the sea and internal reservoirs of the Republic of Kazakhstan" of the order of the Government of the Republic of Kazakhstan of January 27, 1997 No. 105 "About approval of the Regulations on procedure for carrying out oil operations at the sea and internal reservoirs of the Republic of Kazakhstan" and the orders of the Government of the Republic of Kazakhstan of June 29, 1999 No. 876 O to development of the National plan for the prevention of oil spills and response to them" I order to No. 693:

1. Approve and enact the following normative and technical documents on oil and gas industry:

- Safety rules when carrying out oil operations at the sea and internal reservoirs of the Republic of Kazakhstan;

- Technical rules of construction of constructions when carrying out oil operations at the sea and internal reservoirs of the Republic of Kazakhstan.

2. To all companies of oil and gas industry which are engaged in sea oil operations to accept again entered normative and technical documents (NTD) to management and execution.

3. To department of oil and gas (Bozumbayev K. A.) together with the consulting company "Haglier Bai Xiervixiez" (under approval) to provide legal registration in the Ministry of Justice of the Republic of Kazakhstan, and also replication and mailing of the specifications and technical documentation.

4. To impose control of execution of this order on the Director of the department of oil and gas (Bozumbayeva K. A.).

 

Minister

M. K. Ablyazov

It is approved: Chairman of the Agency on emergency situations Republic of Kazakhstan Sh. K. Kulmakhanov on June 28, 1999.

Minister of natural resources and environmental protections Republic of Kazakhstan S. Zh. Daukeev July 6, 1999.

Approved by the order of the Minister of Energy, the industry and trade of the Republic of Kazakhstan of July 9, 1999 No. 185

Safety rules when carrying out oil operations at the sea and internal reservoirs of the Republic of Kazakhstan

These rules are developed by the Working group created by the order on the Department of Energy, the industry and trade of the Republic of Kazakhstan No. 39 of March 11, 1998 according to the order of the Government of January 27 1997, No. 105.

Contractors:

Department of Energy, the industries and trade of the Republic of Kazakhstan, the Ministry of Natural Resources and Environmental Protection of the Republic of Kazakhstan, emergency situations Agency of the Republic of Kazakhstan, JSC Kazakhstankaspiyshelf, with the assistance of the company Haglier Bai Xiervixiez (Hagler Bailly Services, I№c), the Kazakhstan Oil Association (Kazakhsta№ Petroleum Associatio№) *, Research center on safe engineering of NIPI Kaspiymunaygaz, NOC "Kazakhoil" and with assistance of the American agency on the international development (USAID).

* Note: Participation of members of the Kazakhstan Oil Association (KRA) in development of this document does not mean full consent with each provision containing in this document both from KRA as the organization, and from her certain members. Nevertheless, the Kazakhstan Oil Association recommends to accept this document for the purpose of providing normative basis for timely carrying out investigation and development of marine territories of Kazakhstan and for creation of base for future modifications and enhancements of normative regulation.

1 GENERAL PART

1.1. Introduction and scope of Rules

All works connected with search as investigation and development of oil and gas deposits at the sea and internal reservoirs of the Republic of Kazakhstan shall be carried out according to these Safety rules when carrying out oil operations at the sea and internal reservoirs of the Republic of Kazakhstan (further referred to as "Rules") and the current laws, provisions, rules and standards of the Republic of Kazakhstan concerning safe engineering. Rules are obligatory for execution by all organizations and companies performing oil operations at the sea and internal reservoirs irrespective of patterns of ownership, sources of financing and the country of accessory.

In case of contradiction between separate provisions of the existing normative and technical documents (NTD) and these rules, Rules have the priority right of application.

In Rules requirements of safe engineering when carrying out sea seismoprospecting and explosive works are not considered, and also during the laying and operation of underwater oil and gas pipelines, cables of electricity transmission and communication as they are covered by other specifications and technical documentation on which references in the text of Rules are given. The list specified to the specifications and technical documentation is given in Appendix.

1.2. General provisions

These rules determine the minimum requirements necessary for creation of safe working conditions and do not limit initiative of the Contractor at the choice of methods and ways of their achievement if its actions are based on the safest procedures, methods, technologies and experience of the organization of safe operation accepted in the international sea oil industry.

The minimum requirements are obligatory for execution if the Contractor does not offer instead of other, best ways of goal achievement of safety.

Rules shall be considered as basis for conducting external inspections and audits on safety.

If the authorized representative of monitoring body orders to the Contractor to perform operations according to the procedure which is not stipulated by Rules and which contradict the procedures adopted in the international practice of the safe organization of sea oil operations responsibility for safety lays down on the monitoring body which issued the instruction.

All international, regional and foreign standards can be applied in the territory of the Republic of Kazakhstan after passing by them of the corresponding procedures of acceptance by bodies of standardization of the Republic of Kazakhstan (1)1 (footnote).

Part of international standards which were used when writing Rules is given in Appendix.

If the international standards, standards and agreements in the field of labor protection assume higher requirements of providing safe engineering in comparison with Kazakhstan, the Contractor shall follow the international requirements.

1.3. Determinations and terminology

In these provisions the following determinations and terms are used:

Temporary shelter: the place for the shelter or protection against such emergency situations, such as the fire, explosion or emission of toxic gas expected the short period necessary for a start for organized evacuation.

Contract area: the site allocated to the Contractor for carrying out oil operations according to the legislation of the Republic of Kazakhstan.

Monitoring bodies: the state bodies given the controlling, supervising and inspection authority in questions of safe engineering, health protection and the environment according to the Legislation of the Republic of Kazakhstan. Hereinafter in the text it is meant, but to that it is not limited: Emergency situations agency of the Republic of Kazakhstan; Department of Energy, industries and trade; The Ministry of Labour and social the populations are sewn up; Ministry of Health, educations and sport; Ministry of Natural Resources and Environmental Protection; Ministry of transport, communications and tourism; The Ministry of Agriculture, and also regional bodies, departments and representative offices of the specified departments. Due to the possible change of names of departments further in the text they will be mentioned without reduction of the official name. For example, the Ministry of Natural Resources and Environmental Protection will be mentioned as the Central authorized body in the field of environmental protection.

Minimum requirements: the list of the minimum requirements or recommendations which the Contractor shall carry out or take into account for application of alternative way of solving the problem when implementing this or that work type.

Obligatory tasks: these are the safety purposes which need to be reached when implementing this or that work type.

Hot work: all types of activity with use of open flame or rather powerful sparking which can lead to ignition, including but, without being limited to such works as welding, cutting, roasting and sharpening.

Plan of safe operation: The part of the engineering design or appendix to it explaining to what procedures of safety will follow the Contractor when carrying out sea oil operations.

Contractor: the subsoil user who signed the contract with competent authority and having the license for conducting works in the contract area according to the legislation of the Republic of Kazakhstan.

Practical: the preferable or well proved experience or technological transaction.

Working language: language in which documentation on sea object is kept: English. Kazakh and Russian are obligatory to use for communication.

Signals safety preventions / signs: All signals preventions / signs of safety shall conform to the existing requirements and to be represented graphical or in the working language used on object.

Constructions: all platforms, stationary or portable, drilling rigs, wells, pipelines, artificial islands, channels, dams, buildings and other production facilities which are directly used by search, investigation and development of oil and gas deposits.

Constructions with permanent presence of personnel (managed by people) - constructions on which operation personnel to be on watch 24 four hours a day, seven days a week. Does not include constructions on which works are carried out part of day.

Standard: the commonly accepted regulation or the quality determined by independent monitoring body which determine required criteria of results of work.

1.4. Rights, obligations and responsibility of the Contractor.

1.4.1. The contractor bears responsibility for:

- safe work, performed under the contract for investigation and/or oil and gas extraction in the contract area and in other areas by own forces or with involvement of subcontractors;

- maintaining the established documentation on safety and provision to state bodies of the established reporting under all works, including works of subcontractors;

- coordination and rendering assistance in work of inspections of the state monitoring bodies and accomplishment of legal instructions at the scheduled time;

1.4.2. On each sea object the Contractor shall appoint the representative responsible for safe work and for coordination of work of monitoring bodies when conducting inspections.

1.4.3. The contractor shall allow freely inspectors of monitoring bodies or make their delivery to the inspected object in mutually agreed terms taking into account weather conditions, availability of transport and safety of personnel, inspectors and the carried-out works.

1.4.4. The contractor bears responsibility for observance of requirements of Rules. If Rules do not contain the description of specific methods of achievement of objectives, the Contractor shall use the best efforts to be effective according to the purposes of Rules, making use of the best engineering practices, the safest and effective of available technologies.

1.4.5. The contractor shall perform all operations by the safest and qualified method and contain the equipment in safe condition for the purpose of health protection and life of personnel, the environment and property.

1.4.6. The contractor shall take all necessary precautionary measures for the purpose of control, liquidation and elimination of dangers.

1.4.7. The contractor has the right, and in the established cases upon the demand of monitoring bodies, shall, develop and enter own instructions, and also use the new or alternative methods, procedures, the equipment or technologies directed to enhancement and disaggregation of requirements of these rules provided that the Contractor will inform on it monitoring bodies.

1.4.8. In 30 days prior to the planned start-up of sea construction in operation the Contractor shall notify on it the Central executive body of the state in the field of power, the industry and trade which creates commission of representatives of monitoring bodies and the local executive authority on acceptance of object in operation. The contractor shall render assistance in work of such commission when carrying out the prestarting audit.

1.4.9. The operator shall provide timely submission of engineering designs of construction of wells, artificial islands, communications, technological schemes of development, projects of mining for review with bodies of technical supervision.

1.5 Regulations on the Management system health protection, work and environment.

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