The Order of the State Administration of Work Safety

No. 25

The Regulations on Safety Management for Offshore Oil Industry, deliberated and adopted at the Director-general's working meeting of the State Administration of Work Safety on August 24, 2009, are hereby promulgated, and shall come into force as of December 1, 2009.

Director-General: Luo Lin

Date: September 7, 2009

The Regulations on Safety Management for Offshore Oil Industry Chapter I General Provisions Article 1 For the purposes of strengthening the safety management for offshore oil industry, safeguarding the safety of the employees’ lives and property, preventing and reducing safety accidents of offshore oil production, The Regulations are hereby formulated in accordance with relevant laws such as the Production Safety Law, regulations and standards.

Article 2 The Regulations shall apply to the work safety for offshore oil (including natural gas, hereinafter the same) exploration and production in the internal waters, territorial sea, contiguous zone, exclusive economic zone, continental shelf within the territory of the People's Republic of China as well as other sea areas under the jurisdiction of the People's Republic of China, and to the supervision and administration thereof.

Article 3 Operators and contractors of offshore oil operations are the subjects of legal responsibilities for the work safety of offshore oil and shall be responsible for the work safety thereof.

Article 4 The China Offshore Oil Operation Safety Office under the State Administration of Work Safety (hereinafter referred to as “COOOSO”) is responsible for the supervision and administration on the work safety of offshore oil nationwide; and the COOOSO branches stationed in China National Offshore Oil Corporation, China Petroleum & Chemical Corporation, and China National Petroleum Corporation (hereinafter collectively referred to as the “Relevant COOOSO Branches”) shall be responsible for the supervision and administration on the work safety of offshore oil of the aforementioned corporations respectively.

Chapter II Record-filing Administration of Installations/Facilities Section 1 Record-filing Administration of Production Installations/Facilities Article 5 Offshore oil production installations/facilities shall be subject to commissioning. An operator or contractor shall, forty-five (45) days prior to the commissioning, go through the record-filing formalities with the local relevant Offshore Oil Safety Branch, and simultaneously submit the application for the commissioning record filing of the production installations/facilities, application for the put-into-service record filing of the subsea pipeline, and the following materials:

1. The final inspection certificate (or temporary inspection certificate) and inspection report issued by the inspection authority;

2. Safety precautions for the commissioning;

3. The registration form of the materials for the construction phase;

4. Relevant documents on safety facilities passing the design examination, on the design modification of safety facilities, and on safety facilities passing the examination of the design modification;

5. The qualification proof of the construction organization;

6. Work safety accidents and other major construction-quality accidents during the construction period;

7. Registration forms of relevant certificates and documents relating to the production installations/facilities;

8. Main technical specifications, the general arrangement plan and process flow diagram of the production installations/facilities;

9. Safety qualification certificates of the principal in charge of operation of the production

installations/facilities and other safety managerial staff;

10. The classification list for obtaining certificates of auxiliary equipments to the production installations/facilities and relevant certificates;

11. The operation safety manual of the production installations/facilities; and

12. The contingency plan for the operation safety of the production installations/facilities.

Where the production installations/facilities are floating production storage and offloading vessels (hereinafter referred to as “FPSO”), in addition to the materials set forth in the paragraph above, the inspection certificates, factory certificates and post-installation test reports of the fast release device and the devices for measuring hawser tension and distance, shall be submitted.

Where the production installations/facilities are the subsea pipelines, in addition to the materials set forth in the first paragraph of this Article, the registration forms of certificates and documents relating to the put-into-service record filing of the subsea pipelines as well as the relevant certificates and documents shall be submitted.

Article 6 The Relevant Offshore Oil Safety Branch shall strictly examine the materials relating to the production installations/facilities submitted by the operators or contractors and, whenever necessary, shall simultaneously carry out a spot inspection.

Where a spot inspection is necessary, the Relevant Offshore Oil Safety Branch shall, ten (10) days in advance, discuss and agree on the detailed issues relating to the spot inspection with the operator or contractor concerned. The operator or contractor shall coordinate with the Relevant Offshore Oil Safety Branch in the spot inspection and provide the following materials:

1. the registration form of safety training certificates of the personnel;

2. the drawing of the actual layout of fire fighting and life saving appliances and the muster list;

3. safety management documents, including the system of responsibility for production safety, safety operation specifications, the work permit system, the safety inspection system, the system on anchoring, loading and unloading of vessels, the helicopter management system, the hazardous materials management system, procedures for the remote control and detection of the unmanned platforms, and the oil (gas) export management system; and

4. in the case of oil production installations/facilities at beach and alongshore, the conformity documents, inspection certificates issued by the inspection authority and post-install test reports of the installations/facilities at and along the seaway.

Where the examination and spot inspection are passed, the Relevant Offshore Oil Safety Branch shall issue a notice to the operator or contractor concerned on the commissioning record filing of the production installations/facilities; in the event that the record-filing materials or safety conditions of the site of the production installations/facilities fail to accord with relevant provisions, the Relevant Offshore Oil Safety Branch shall notify the operator or contractor in writing in a timely manner to make rectification.

Article 7 Operators or contractors shall organize the commissioning strictly in compliance with the work safety precautions of commissioning listed in the record filing documents, and the time limit for commissioning shall not exceed twelve (12) months. Provided that the production installations/facilities operate normally during the period of commissioning, operators or contractors shall apply to COOOSO for safety acceptance inspection.

The production installations/facilities may be formally put into service only after the acceptance inspection is passed and the work safety permit for the production installations/facilities has been obtained by the operators or contractors.

Article 8 Under any of the following circumstances, the operators or contractors of production installations/facilities shall report to the Relevant Offshore Oil Safety Branch in a timely manner:

1. where any of the key safety devices such as the surface and underground safety valve, fire and flammable, toxic and harmful gas detection and alarm systems, and fire fighting and life saving appliances, is replaced or dismantled;

2. where the relevant content of the contingency plan is changed;

3. where the oil (gas) production has been discontinued for over ten (10) days or terminated;

4. where the originally designed purpose of the subsea oil (gas) pipeline has been changed;

5. where the maximum designed transportation capacity or pressure of the subsea oil (gas) pipeline is exceeded;

6. where the subsea oil (gas) pipeline is seriously damaged, ruptured or blown up;

7. where any major pollution accident happens due to the leakage of oil (gas) transported by the subsea oil (gas) pipeline;

8. where the destabilization, horizontal or vertical movement, impendency, subsidence or flotation of the subsea oil (gas) pipeline exceeds the designed allowable deviation;

9. where the production via the subsea oil (gas) pipeline is ceased due to the medium blockage;

10. where the subsea oil (gas) pipeline needs the overhaul and transformation;

11. where the safety protection system (such as the emergency blow-down device and the targeted cut-off device) of the long-distance oil (gas) pipeline has been in malfunction for a long time; or

12. any other circumstances that may have a significant impact on work safety.

Section 2 Record-filing Administration of Operating Installations/Facilities Article 9 The geophysical prospecting, drilling/workover, pipelaying, hoisting and living support by the offshore oil operating installations/facilities shall be filed for record with the Relevant Offshore Oil Safety Branch. An operator or contractor shall, fifteen (15) days prior to the operation, submit the application for the record filing of operating installations/facilities and the following materials to the Relevant Offshore Oil Safety Branch:

1. registration forms of the certificates relating to the application for the record filing of operating installations/facilities;

2. the classification list for obtaining certificates of auxiliary equipment to the operating installations/facilities and relevant certificates;

3. the ship maneuvering manual;

4. the operation contract;

5. the operation safety manual; and

6. the contingency plan.

With respect to the operating installations/facilities for drilling/workover, in addition to the materials set forth in the paragraph above, the following materials shall be submitted:

1. the certificates issued by the issuing and inspection authority, leave-factory and post-repairing conformity certificates, and post-installation test reports of the special drilling/workover equipment, BOP stack, BOP control system, choke manifold and the control panel, killing manifold, cementing equipment and the test instruments;

2. safety qualification certificates of the principal of the production installations/facilities and other relevant work safety managerial staff; and

3. the certificate of competency of the captain and chief engineer of the self-propulsion operating

installations/facilities.

As for the jack-up rig, in addition to the materials set forth in the first paragraph of this Article, the stability calculation report, the lifting equipments’ inspection certificates issued by the issuing and inspection authority, leave-factory and post-repair conformity certificates, and post-installation test reports shall be submitted.

As for the geophysical vessel, in addition to the materials set forth in the first paragraph of this Article, the following materials shall be submitted:

1. leave-factory conformity certificates, inspection certificates issued by the issuing and inspection authority, and post-installation test reports of the hypocenter system, the main pressure vessel and apparatus of the hypocenter system, the tug steel cable and winch of the hypocenter system, and the cable winch; and

2. the storage material quantity, storage conditions, measures on the stock-in/stock-out management and delivery from storage, caretaking and use systems of hypocenter hazardous articles (including the explosive, detonator, flammable and explosive gas).

As for the pipelaying vessel, in addition to the materials set forth in the first paragraph of this Article, the following materials shall be submitted:

1. leave-factory conformity certificates, inspection certificates issued by the issuing and inspection authority, and post-installation test reports of the tensioner and the control system thereof as well as the pipeline-rendering winch; and

2. qualification certificates of the captain (or the person in charge of the vessel), hoisting machinery driver, hoisting director and craneman.

As for the floating-crane pontoon or living support vessel, in addition to the materials set forth in the first paragraph of this Article, the qualification certificates of the captain (or the person in charge of the pontoon or vessel), hoisting machinery driver, hoisting director and craneman shall be submitted.

Article 10 The Relevant Offshore Oil Safety Branch shall strictly examine the materials relating to the operating installations/facilities submitted by operators or contractors and, when necessary, carry out a spot inspection.

Where a spot inspection is necessary, the Relevant Offshore Oil Safety Branch shall, ten (10) days in advance, discuss and agree on the specific issues on the spot inspection with the operator or contractor concerned. The operator or contractor shall coordinate with the Relevant Offshore Oil Safety Branch in the spot inspection and provide the following materials:

1. the registration form of personnel safety training certificates;

2. the drawing of actual layout of the fire fighting and life saving appliances and the muster list;

3. safety management documents, including the safety management’s organization chart, safety responsibility regulations, safety operating rules, safety inspection system, and work permit system; and

4. records of safety activities and the emergency drill.

Where the examination and the spot inspection are passed, the Relevant Offshore Oil Safety Branch shall issue a notice to the operator or contractor concerned on the record filing of the offshore oil operating installations/facilities; provided that the materials for record filing or installations/facilities’ safety conditions fail to accord with relevant provisions, the Relevant Offshore Oil Safety Branch shall notify the operator or contractor in writing in a timely manner to make rectification.

Article 11 In general, the period of geophysical prospecting, drilling/workover, pipelaying, hoisting

or life support by the offshore oil installations/facilities shall not exceed one year. Where it is necessary to extend the period, the operator or contractor concerned shall, fifteen (15) days prior to the expiration of the period, apply to the Relevant Offshore Oil Safety Branch for extending the period, and the extended period shall not exceed three months.

Article 12 Under any of the following circumstances, the operator or contractor of operating installations/facilities shall report to the Relevant Offshore Oil Safety Branch in a timely manner:

1. where the well control system is changed;

2. where any of key safety installations/facilities such as the fire and toxic and harmful gas detection and alarm system, fire fighting apparatus, and life saving appliances is replaced or dismantled;

3. where the operation contract, the operator or the operation sea area is changed;

4. where the relevant content of the contingency plan is changed;

5. where the oil (gas) operation has been discontinued for over ten days or terminated; or

6. where any other circumstances under which the operation safety is significantly influenced.

Section 3 Management of the Record Filing of Extended Testing Installations/Facilities Article 13 Operators or contractors shall, fifteen (15) days prior to the extended offshore oil field (well) testing, submit the application for the record filing of extended well testing installations/facilities and the following materials to the Relevant Offshore Oil Safety Branch:

1. the registration form of certificates and other documents relating to the extended testing installations/facilities;

2. process flow diagram, the layout plan, and technical specifications of the extended testing installations/facilities;

3. safety qualification certificates of the principal of the added operation and production installations/facilities and other relevant safety managerial staff;

4. contingency plan for the extended testing operation;

5. certificates and other materials relating to the mooring point, anchor, anchor chain, fast kickoff mechanism, and the devices for measuring hawser tension and distance of the oil tanker or floating production storage and offloading vessel; and

6. leave-factory conformity certificates, inspection certificates, and post-install test reports of special extended testing equipment or systems.

The special extended testing equipment or systems as mentioned above include the oil and gas heater, oil and gas separator, crude export pump, fluid separator of gas flaring and condensate, steam boiler, heat interchanger, waste oil recovery equipment, wellhead device, effluent oil treatment equipment, mechanical oil production equipment, aboveground or subsurface BOP, wellhead device for preventing hydrogen sulfide, detecting and protective devices, inert gas system, diesel oil displacement system, and fire and toxic and harmful gas detection and alarm system.

Article 14 The Relevant Offshore Oil Safety Branch shall strictly examine the materials relating to the extended testing installations/facilities submitted by operators or contractors and, when necessary, carry out spot inspection.

Where it is necessary to carry out spot inspection, the Relevant Offshore Oil Safety Branch shall, ten days (10) in advance, discuss and agree on the detailed issues on the spot inspection with the operator or contractor concerned. The operator or contractor shall coordinate with the Relevant Offshore Oil Safety Branch in the spot inspection and provide the following materials:

1. the registration form of personnel safety training certificates of the extended testing operation

on drilling unit and the oil tanker or floating production storage and offloading vessel;

2. the layout plan of the fire fighting apparatus, life saving appliances, and fire and toxic and harmful gas detection and alarm system, plan of classified hazardous areas, and the muster list; and

3. safety management documents, including the documents on the set-up of the safety management department, system of responsibility for production safety, safety operation specifications, safety inspection system, work permit system, system on anchoring, loading and unloading of the vessel, and oil (gas) export management system.

Where the examination and the spot inspection are passed, the Relevant Offshore Oil Safety Branch shall issue an notice on the record filing of extended offshore oil field (well) testing installations/facilities; or where the materials for record filing or safety conditions of the site of the installations/facilities fail to accord with relevant provisions, the Relevant Offshore Oil Safety Branch shall notify the operator or contractor in writing in a timely manner to make rectification.

Article 15 In general, the period of offshore oil field (well) testing operation shall not be extended for more than one (1) year. Where it is necessary to make a further extension, the operator or contractor concerned shall, fifteen (15) days prior to the expiry of the period, apply to the Relevant Offshore Oil Safety Branch, and the further extension period shall not exceed six (6) months.

Article 16 Under any of the following circumstances, the operator or contractor of offshore oil field (well) installations/facilities which are subject to extended testing shall report to the Relevant Offshore Oil Safety Branch in a timely manner:

1. where the main structure, equipment or the well control system on the extended testing installations/facilities is changed;

2. where any of the key safety devices such as the fire and flammable, toxic and harmful gas detection and alarm system, fire fighting and life saving appliances is replaced or dismantled;

3. where the relevant content of the contingency plan is changed; or

4. any other circumstances that have a significant impact upon work safety.

Chapter III Management of Work Safety Section 1 Basic Requirements Article 17 Operators and contractors shall, in the process of offshore oil production, ensure the safety conditions of offshore oil production and operating installations/facilities (hereinafter referred to as the “installations/facilities”) to comply with laws, regulations, rules as well as relevant national and industrial standards, and shall establish a good safety management system. The installation manager shall be fully responsible for the safety management.

Article 18 The different areas of the installation can be classified into the following three (3) levels of hazardous areas according to their respective hazard level:

1. zero hazardous area, where there is flammable gas or vapor constantly reaching the combustible or explosion concentration under normal operating conditions;

2. class-1 hazardous area, where there is intermittent or periodical flammable gas or combustible vapor reaching the combustion or explosion concentration under normal operation conditions; and

3. class-2 hazardous area, where it is not possible to reach the combustion or explosion concentration under normal operating conditions; however it is possible under abnormal operating conditions.

The operator or contractor of the installations/facilities shall clearly mark the hazard levels of the hazardous areas on the drawing attached to the operation manual of the installations/facilities. The exit, door and hatchway to the hazardous areas shall be marked with the signs “Hazardous Area”, “No Fire”, and “No Kindling” in both Chinese and English.

Article 19 Operators or contractors of the installations/facilities shall establish the work approval program on, for example, hot work, electrical work, confined space entry, working at height, and operation outside and along with the hull.

The operating organization shall, prior to the commencement of any work set forth in the first paragraph of this Article, submit a written application specifying the type, place, duration, and safety measures of the operation, and can make an operation only after obtaining the Permit-to-Work approved and issued by the installation manager. The notice shall include the operation content, relevant inspection report, operation requirements, safety procedures, personal protective equipment, safety equipment, and the valid term of the notice.

After receiving the notice of the operation, the operating organization shall adopt relevant measures in accordance with the requirements as specified in the notice and establish detailed examination and operation procedures.

In the case that the operation conditions change significantly during the period of operation, the operation shall be suspended and the operating organization shall immediately notify the installation manager. The operation may be continued only after being approved by the installation manager.

After the operation is completed, the person in charge of the operation shall fill the completion time, work quality and safety conditions in the notice, and submit the notice to the installation manager for collection. The notice shall be kept for at least one (1) year.

Article 20 All the emergency evacuation passageways leading to the life boats (rafts), helicopter deck, and the passageways leading to fire fighting equipment on the installations/facilities shall be marked with clear signs and kept unimpeded.

Article 21 All the equipment on the installations/facilities shall comply with the following provisions:

1. the equipment shall meet the safety requirements as specified in relevant laws, regulations, rules and standards of the State, and the leave-factory conformity certificate or inspection certificate of the equipment has been obtained;

2. the moving part, which is hazardous to personal safety, shall be covered with a shield or equipped with other safety protection device;

3. the operation record, equipment deficiency and the failure recording and reporting system shall be established;

4. the safety operation specifications, system on the periodic maintenance and inspection of equipments, and the system on fixation of staff and posts to manage the equipment shall be established; and

5. risk analysis shall be conducted before major equipment is added or dismantled or the function thereof is changed. In the case of reconstruction or extension, the review and approval procedures shall be processed with the competent government department according to relevant provisions.

Article 22 The life saving boat, rescue craft, life raft, buoy, jacket, heat-retaining life combination suit and accessories equipped to the installations/facilities shall comply with the International Convention for Safety of Life at Sea and be certified by the inspection authority which is approved by COOOSO.

The quantity of life saving appliances for offshore oil installations/facilities shall meet the following

requirements:

1. the totally enclosed rigid motor fire-protected life boats shall be able to accommodate the total number of the persons on the self-elevating and fixed installations/facilities or two hundred percent (200%) of the total number of the persons on the floating installations/facilities. It’s no need for a unmanned installation to equip with the totally enclosed rigid motor fire-protected life boat. Upon risk analysis, life boats may be replaced with life rafts during the period of construction, installation or overhaul of the installations/facilities;

2. the inflatable life rafts shall be able to accommodate the total number of the persons on the installations/facilities, and the placement level of inflatable life rafts shall meet the requirements on the height above the water surface. The unmanned installations/facilities shall be equipped with an inflatable life raft for twelve (12) persons;

3. at least eight (8) life buoys shall be equipped and reasonably distributed on the installations/facilities, including two (2) with auto-luminescence floating lights and four (4) with auto-luminescence floating lights and the self-activating smoke sign. Each life buoy with auto-luminescence floating lights and the self-activating smoke sign shall be equipped with one (1) floatable life line, the length of which shall be 1.5 times the distance between the placement level of the life buoy and the water surface of the lowest astronomical tide level and be at least thirty (30) meters; and

4. life jackets shall be equipped in the proportion of 210% of the total number of the persons on the installations/facilities, of which, one hundred percent (100%) shall be provided for the accommodation, one hundred percent (100%) for the lifeboat station, and the remaining ten percent (10%) for the work areas on the deck, and a certain number of life vests may be provided. In the cold sea area, each person on the installations/facilities shall be equipped with one (1) thermal insulating life suit. In the case of an unmanned platform, each person, while boarding the platform, shall be equipped with one (1) life jacket or thermal insulating life suit according to the temperature of the operation sea area.

The quantity of life saving appliances equipped on the platforms located at beach and alongshore shall meet the following requirements:

1. at least four (4) life buoys shall be provided on the platform, each life buoy equipped with the floatable life line with the length of at least thirty (30) meters, including two (2) life buoys with the auto-luminescence floating light and the other two (2) life buoys with the auto-luminescence floating light and self-activating smoke signals, and

2. each person on the platform shall be equipped with at least one (1) life jacket, and the work areas shall be provided with a certain number of marine work life jackets or life vests. In the cold sea area, each person on the platform shall be equipped with one (1) thermal insulating life suit.

All life saving appliances shall be marked with their corresponding name, reasonably stored and marked with their respective storage locations on the general layout plan of the installation. In the event that the life saving appliances fail to meet relevant requirements under the circumstance of special operation, corresponding safety precautions shall be established and submitted to the Relevant Offshore Oil Safety Branch for review and approval.

Article 23 Fire fighting apparatus on the installations/facilities shall comply with the following provisions:

1. in accordance with relevant provisions of the State, fixed fire extinguishing equipment and apparatus, such as the fire water system, foam extinguishing system, gas extinguishing system, and dry powder extinguishing system, shall be set up according to the nature and hazard levels of the potential fire, and be subject to the approval of the inspection authority. A simple unmanned platform may be equipped with no fire water equipment or apparatus;

2. automatically or manually operated fire and toxic and harmful gas detection and alarm systems shall be set up and the central control room shall be equipped with the alarm and shutdown system;

3. it shall be provided with four (4) sets of fireman's outfits, including the proximity suit, fireman's boots and gloves, fire fighting helmet, positive pressure air breathing apparatus, fireman's axe, and safety lamp with continuous service for three (3) hours. Upon approval by the inspection authority, the quantity of the fireman's outfits may be reduced according to the nature of the platform and number of persons on the platform;

4. the on-site management organization at beach and alongshore shall be equipped with at least two (2) sets of fireman’s outfits including the fire fighting helmet, protective clothing, fireman's boots, safety lamp, fireman's axe, at least three (3) sets of positive pressure air breathing apparatus with the air bottle, and one (1) mobile fire-fighting pump; and

5. all the fire fighting apparatus shall be placed at the positions easy for use, periodically inspected, and kept in a good condition. The inspection record shall be labeled on the fire fighting apparatus.

Article 24 The equipment for testing, logging or workover in hazardous areas of the installations/facilities shall be explosion-proof, and it shall be adopted the explosion-proof function with positive pressure in the prefabricated house which contains non-explosion-proof electric appliances.

Article 25 The hoisting operation shall comply with the following provisions:

1. the operator shall hold the special operation qualification certificate, be familiar with and abide the operation specifications of hoisting equipment;

2. the maximum safe load has been marked on the hoisting equipment; in the case of a mobile davit arm, maximum safe loads of the davit arm at different angles shall be marked;

3. regular maintenance shall be conducted for the hoisting equipment in accordance with relevant provisions so as to ensure that the brake, limitator, safe load indicator, and alarm device are all in readiness, accurate, flexible, and reliable; and

4. the hoist and accessories shall be inspected regularly in accordance with relevant provisions, and the results shall be recorded on the inspection book.

The operation of transfer basket shall comply with the following provisions in addition to the provisions as specified in Items 1 to 4 of Paragraph 1 of this Article:

1. the number of the persons carried by the transfer basket shall be limited;

2. the persons carried by the transfer basket shall wear the life vest or life jacket in accordance with relevant provisions;

3. the transfer basket may only be used for lifting persons and their belongings;

4. a person shall be specifically-assigned to be responsible for inspecting and maintaining the transfer basket, and regular inspections shall be organized by the inspection agency;

5. the transfer basket shall not be used when the wind speed exceeds fifteen (15) m/s or shall be ceased immediately when the safe lifting or lowering of the cage is affected; and

6. the transfer basket shall, when carrying the person, start the lifting or lowering operation after it moves above the water surface, and the turning angle shall be as low as possible.

Article 26 The aloft work and outboard work shall comply with the following provisions:

1. operators of the aloft work or outboard work shall wear the safety helmet and safety belt, and the operators of the outboard work shall wear the life jacket and take other necessary safety

measures; and

2. the aloft work and outboard work shall be ceased immediately when the wind speed exceeds fifteen (15) m/s or in any other severe weather.

Article 27 Hazardous materials shall be managed in accordance with the following provisions:

1. any hazardous materials on the installations/facilities (including explosive, compressed gas, liquefied gas, flammable liquid, inflammable solid, spontaneously combustible materials, substance spontaneously combustible in wet air, oxidizing agent, organic peroxide, poison, and corrosive) must be stored at the specified place or container which is far away from hazardous areas and living areas, and the storage locations of hazardous materials shall be marked on the layout drawings attached to the operation manual of the installations/facilities; and no person may store hazardous materials without explicit approval.

2. hazardous materials shall be managed by the designated-person, and the warehouse entry-and-out, consumption, and use of hazardous materials shall be recorded and properly kept; and

3. the opening and hatchway of the passageway to the storage locations of hazardous materials shall be marked with obvious signs “Hazardous Materials” in both Chinese and English.

Article 28 The take-off and landing of helicopters shall be managed in accordance with the following provisions:

1. a person shall be specially designated to be responsible for directing and providing information and services for the take-off and landing of helicopters;

2. emergency equipment and tools for the take-off and landing of helicopters shall be provided and marked with obvious signs “Helicopter Emergency Tools" in both Chinese and English;

3. where the quantity of fuel oil for the round-trip distance between the installations/facilities and the airport exceeds the oil tank capacity of the helicopter, safe and effective oil tank for fueling of the helicopter, fuel oil quality inspection device, and fuel-servicing equipment shall be provided in accordance with relevant provisions.

4. after getting in contact with the installations/facilities, a helicopter may take off from or land on the installations/facilities only after being approved by the installation manager, except in an emergency;

5. after receiving the request of landing of a helicopter from the aircraft commander or a crew member of the helicopter, the contact person responsible for the take-off and landing of helicopters shall provide the information, such as the wind speed, wind direction, visibility, and sea conditions, for the helicopter;

6. the radio operator shall keep monitoring the radio signal from the helicopter until it lands; and

7. the contact person responsible for the take-off and landing of helicopters may direct relevant persons to board or get off a helicopter, load or unload goods, or fuel the helicopter only after the hatch door of the helicopter is opened by the crew members.

The contact person responsible for the take-off and landing of helicopters shall, prior to the take-off or landing of a helicopter, make the following preparations:

1. to eliminate the barriers and inflammables from the helicopter deck;

2. to examine whether the safety equipments of the helicopter deck, including the lighting, anti-skid net, fire fighting apparatus, and emergency tools, are in a good condition;

3. to stop any hoisting operation near the helicopter deck and any work with naked fire within the distance of fifteen (15) meters from the helicopter deck;

4. to prevent any unauthorized persons from approaching the helicopter deck;

5. to organize the stand-by vessel to weigh anchor nearby for orders and organizing fire fighters to get ready; and

6. in case of natural gas release, perforating operation, or well testing, to prohibit the helicopter from approaching the installations/facilities until reliable safety precautions have been adopted.

Article 29 Labor protection shall comply with the following provisions:

1. the staff on the installations/facilities shall be equipped with personal protective equipment in compliance with relevant safety standards;

2. personal protective equipment shall be provided in work areas on the installations/facilities in accordance with relevant provisions of the State and design requirement, and shall be subject to regular inspection; and

3. regular medical examinations for personnel who are exposed to toxic or harmful environment shall be carried out, and rehabilitation treatment shall be given to the staff that has caught occupational diseases in accordance with relevant provisions on occupational disease prevention and treatment.

Article 30 The clinic shall comply with the following provisions:

1. a clinic with basic medical and rescue conditions shall be set up on the attended installations/facilities. Where there are fifteen (15) or more operators on the installations/facilities, the clinic shall be staffed with full-time medical personnel; where there are less than fifteen (15) operators, the clinic may be staffed with part-time medical personnel;

2. general medical supply, first-aid medicine, oxygen, medical apparatus and instruments, and hospital beds shall be provided for the clinic in accordance with relevant provisions of the State;

3. the clinic shall establish the systems on the reporting, treatment and sanitary inspection of epidemic and illness; and

4. the clinic shall establish emergency rescue programs in accordance with relevant provisions of the State.

Article 31 The emergency shelter at beach and alongshore shall comply with the following provisions:

1. to be able to accommodate all the production personnel;

2. to be one grade higher than the platform at beach and alongshore in terms of the structural strength;

3. the ground thereof to be one (1) meter higher than the breakwater;

4. to adopt the reinforced concrete construction with a reliable structure or moveable steel structure;

5. to provide lifesaving food and drinking water that are sufficient to support the people seeking for refuge for five (5) days;

6. to provide the first-aid kit with at least two (2) life jackets, waterproof flashlight and associated batteries, simple medical bind-up articles, and medicine for daily use; and

7. to provide emergency communication apparatuses.

Article 32 Vehicles on duty at beach and alongshore shall comply with the following provisions:

1. to obey the direction given by the principal of the oil installations/facilities at beach and

alongshore and shall not enter into or leave without authorization;

2. to ensure the communication between the equipment on the vehicles and the installations/facilities at beach and alongshore and the land bank base at any time;

3. to be able to accommodate all the personnel on the installations/facilities at beach and alongshore they serve and to be equipped with one hundred percent (100%) life jackets;

4. to be able to work under complicated circumstances such as emergency rescue and evacuation; and

5. to participate in the rescue drill on the oil installations/facilities at beach and alongshore.

Section 2 Management of Stand-by Vessels Article 33 Before the vessel responsible for guarding the installations/facilities (hereinafter referred to as the “stand-by vessel”) commences the guarding operation, the owner of a stand-by vessel shall submit the registration form of the stand-by vessel and the registration form of certificates relating to the stand-by vessel to the Relevant Offshore Oil Safety Branch, and go through the formalities for the registration of the stand-by vessel. Upon examination and approval, the Relevant Offshore Oil Safety Branch shall go through the registration of the stand-by vessel and issue the certificate of registration of the stand-by vessel. Any vessel that has not gone through such registration formalities shall not be employed as the stand-by vessel. In case the original condition of a stand-by vessel is changed or the stand-by vessel terminates its guarding operation, a report shall be submitted to the Relevant Offshore Oil Safety Branch which handled the registration formalities of the stand-by vessel.

Article 34 A stand-by vessel carrying out the guarding operation is within the range of five (5) nautical miles around the offshore installations/facilities, and shall not leave without explicit approval. Two or more installations/facilities within the guarding scope of one stand-by vessel may share it.

Article 35 A stand-by vessel shall obey the direction by the principal of the offshore installations/facilities guarded by it, be able to accommodate all the persons working on the installations/facilities, and should provide food and drinking water enough for all the persons for one (1) day.

Article 36 A stand-by vessel shall comply with the following provisions:

1. the vessel certificate of a stand-by vessel shall be complete and valid;

2. it shall have the seaworthiness for the sea areas guarded by it;

3. rescue areas shall be set up on both broadsides of the stand-by vessel and kept away from the propeller, and clear signs shall be marked at the rescue areas; The length of the rescue area shall not be less than one third (1/3) of the cargo deck of the stand-by vessel, and the width of the rescue area shall not be less than three (3) meters;

4. the deck should have open space so as to facilitate the rescue operations such as lifting by the helicopter rescue hoist and operations of lowering the transfer basket; and

5. the rescue areas and open deck space shall be within the field of the captain’s view so as to facilitate the direction and rescue.

Article 37 A stand-by vessel shall be equipped with the following equipments and tools which meet the requirements of emergency rescue and evacuation of persons:

1. one (1) set of sling stretcher and one (1) shovel-like stretcher respectively;

2. two (2) hooks with long handle for rescue;

3. at least one (1) equipment throwing ropes;

4. four (4) life buoys with self-igniting buoy lights, reverse reflective strips, and ropes with the lengthen of at least thirty (30) meters;

5. medical supplies for simple medical bind-up and first aid;

6. net hanging on the broadside near one rescue area for the persons in water to climb;

7. one (1) rescue boat complying with the International Convention for Safety of Life At Sea;

8. at least two (2) search lights for the lighting over the rescue areas and surrounding sea areas; and

9. two (2) types of communication tools shall be provided so as to ensure the communication among the stand-by vessel, the installations/facilities guarded by it, and the land-bank base.

Article 38 The crew of the stand-by vessel shall comply with the following provisions:

1. they shall hold valid seaman's record book and certificate of competency;

2. at least three (3) seamen shall be designated to be responsible for rescuing the persons in water;

3. at least two (2) seamen shall be able to manipulate the rescue boat;

4. at least two (2) seamen have participated in the first aid training, and can conduct the first aid, bind-up, and rescue breathing; and

5. the crew shall regularly participate in the rescue drill.

Article 39 The registration certificate of the stand-by vessel is valid for three (3) years, and new registration formalities shall, fifteen (15) days prior to the expiration of the valid period, be renewed.

Section 3 Management of Leased Helicopters Article 40 Operators or contractors shall inspect and supervise the helicopter company on safety conditions.

Article 41 A helicopter company shall meet the following requirements:

1. it shall have the airworthiness certificate issued by the Civil Aviation Administration of China, valid registration certificates, and aircraft radio station licenses for the helicopters;

2. it shall have the helicopters meeting the safe flight requirements and shall meet the corresponding standards as specified in the Minimum Equipment List (MEL);

3. it shall have competent pilots, engineering maintenance personnel, and technical inspectors;

4. it shall organize the pilots to participate in the night flights and life-saving drills for required hours;

5. in case of emergency rescue, it shall be able to provide stand-by helicopters; and

6. it shall improve and implement various rules and regulations on safe flight, and prohibit the flight beyond meteorological conditions or specified air routes or flight altitude.

Article 42 Helicopters shall be equipped with the following emergency rescue equipment:

1. helicopter emergency buoy;

2. marine life jackets for all passengers on board (or thermal immersion suits in case of water temperature below ten centigrade (10℃), life raft and survival kit and life-saving winch for the helicopter use; and

3. the helicopter shall have two hatch-doors on each side that can be abandoned and enough escaping exits.

Article 43 Helicopters shall have the airworthiness and night flight capacity between the flight base and the offshore oil installations/facilities under the conditions of rated load.

Article 44 The helicopter company shall, prior to the flight, make safety emergency procedures which accord with the contingency plan prepared by the operator or contractor.

Article 45 A helicopter must have two (2) pilots in each flight, one (1) of whom shall be designated as the command pilot in charge; where a foreign and a Chinese pilots jointly fly a helicopter, the two (2) pilots shall have corresponding language skills for direct communication.

Article 46 Operators or contractors, and helicopter companies must ensure that the helicopter take-off and landing equipment on the flight base (or alternate airport) and offshore installations/facilities is in safe and serviceable conditions.

Article 47 Operators or contractors, and helicopter company shall, through mutual consultation, establish a system of reporting such as the flight conditions, emergency flight, personal safety, safety of the carried articles, flight fault and aviation accident.

Section 4 Management of Electric Equipment Article 48 System on the safety inspection prior to or subsequent to the overhaul, daily running inspection, safety technique inspection, and regular safety inspection on electric equipment on the installations/facilities shall be established. The safety specifications on the maintenance, welding operation and electric tool operation of electric equipment on the installations/facilities shall be established and perfected, and the system and safety specifications shall be strictly implemented.

Article 49 The electric equipment shall be managed in accordance with the following provisions:

1. the electrician safety tools and appliances shall be provided, used, inspected, and calibrated in accordance with relevant provisions of the State;

2. in case of power cut, power-on, transfer switching, hot-line work, or temporary electricity usage, the approval shall be obtained in accordance with relevant rules regarding operation permit. The added device and circuit shall be removed immediately upon completion of temporary electricity usage;

3. the electric equipment and circuits shall be marked clearly and accurately with the colors and signs as specified in corresponding national standards;

4. during the period of electric equipment operation, there must be at least one (1) experienced supervisor who carries out real-time monitoring; and

5. the electric equipment shall operate according to the rated parameters (including the electric voltage, electric current, power, and frequency) on the nameplate, and necessary overpower, short-circuit, and earth leakage protection devices shall be installed and regularly inspected. The electric equipment’s (except the one below the safe voltage) metal shell shall be connected to the ground;

6. in specific areas of great risk of electric shock, the safe voltage shall be employed in portable lamps, portable electrical equipment, and electric tools in accordance with national standards. When it is impossible to use safe voltage, it shall be subject to the approval of the installation manager and effective measures against electric shock shall be adopted;

7. the electric equipment installed in various classes of hazardous areas shall accord with the explosion-proof types. The components or parts of explosion-proof electric equipment shall not be dismantled without authorization and the explosion-proof function of the equipment shall be well-maintained;

8. the insulating property of electric equipments and circuits, such as the insulating resistance, dielectric strength, and leakage current, shall be measured regularly. If electric equipment is out of service for a long time, prior to the use, the inspection shall be carried out. And it may

only be used after meeting the conditions of operation safety;

9. there must be a good insulating property and sufficient safe distance, as specified in relevant specifications and standards, between the electrified body and the human body, ground, another electrified body, or any other equipment; and

10. effective measures of electrostatic and lightning protection shall be adopted on the installations/facilities.

Article 50 The installations/facilities must be equipped with the emergency power supply as necessary, which shall meet the following requirements:

1. it can meet the power needs of communications, signaling, lighting, basic survival (in the living quarters, life boats, evacuation passageway, and on helicopter deck) and other power systems (including the fire fighting system, well control system, fire and toxic and harmful gas detection and alarm system, and emergency shut-down system);

2. it can automatically start emergency power supply within forty-five (45) seconds after the main power supply is cut off; and

3. it is far away from the hazardous areas and the main power supply.

Section 5 Management of Well Control Article 51 Operators or contractors shall make well control safety measures for oil (gas) wells and blow out contingency plan.

Article 52 Drilling shall comply with the following provisions:

1. before the drilling unit is located at a new well site, operators and contractors shall gather and analyze corresponding geological data. In case there is shallow gas, the partial flow system shall be set up;

2. during the period of drilling, the internal BOP matching the drill pipe shall be provided on the drill floor;

3. when set casing, the size of the BOP shall be matched with that of the casing concerned, and the circulating sub matching the threading of the casing concerned shall be provided;

4. the rubber seal of the BOP shall be maintained and stored according to the technical requirements of the manufacturer, and the sealing element which has been disabled or fails to meet the technical requirements shall not be installed in the BOP;

5. the upper safety cock of kelly shall be installed at the lower part of the swivel, and a lower safety cock shall be installed at the bottom of kelly, and the wrench for opening and closing the cock shall be equipped. The hand-operated and automatic internal BOP (cocks) shall be installed at the lower part of the top drive system, and the wrench for opening and closing the BOP shall be available at all times;

6. the BOP stack is composed of annular BOP and ram BOP, and the size of the closed ram block shall match that of the drill pipe and pipe string concerned. The rated working pressure of the BOP shall not be lower than the design pressure of the drilling, and the rated working pressure of the BOP used for the exploratory well shall not be lower than seventy (70) MPa;

7. the installation, maintenance, and testing of the BOP and corresponding equipment shall meet the requirements of the well control; and

8. the BOP system shall be inspected at regular intervals, and it is recommended to use safety check list when inspecting the BOP system.

Article 53 The BOP stack control system shall be installed in accordance with the following provisions:

1. the liquid pressure of the accumulator of a set of hydraulic control system shall be kept at twenty-one (21) MPa, and the volume of the accumulator’s pressure liquid shall be one and half (1.5) times the volume of all the liquid necessary for closing all the BOP and opening the hydraulic valve;

2. in addition to one (1) control panel installed on the drill floor, one (1) auxiliary control panel shall be installed at a place far away from the drill floor and convenient for operation;

3. the BOP stack shall be equipped with the BOP manifold, choke manifold, and kill manifold which have rated working pressures consistent with that of the BOP stack;

4. two (2) control valves shall be installed at the BOP pipelines of the choke manifold and kill manifold respectively, of which one (1) is hand-operated and of normal open type and another is under remote control;

5. an automatic well fluid filling system shall be set up.

Article 54 The subsea BOP stack shall comply with the following provisions:

1. in case of shallow gas or unclear geological conditions, the partial flow system shall be installed at the conductor pipe;

2. one (1) or two (2) annular BOP and two (2) double ram type preventers shall be installed at the surface casing and intermediate casing, and one (1) of the double ram shall be of all shear ram BOP;

3. one (1) set of subsea accumulator shall be installed so as to immediately provide hydraulic energy to open or close all the BOP and the ram blocks thereof as fast as possible, and a dual control box systems shall be adopted so that one control box can be kept in a good stand-by condition while another control box is in operation;

4. in case it is necessary to repair or replace the BOP stack, the safety of the well must be ensured, and the repair or replacement shall be carried out after the casing and cementing has been finished or before the cement plug has not been drilled out. When necessary, the BOP stack may be repaired or replaced after one (1) cement plug or a bridge plug has been made; and

5. where the combined type drill string is used, the variable ram block shall be installed so as to be adapted to different sizes of drilling tools.

Article 55 The surface BOP stack shall comply with the following provisions:

1. in the case of shallow gas or unclear geological conditions, a partial flow system shall be installed at the marine riser (conductor pipe) of the surface BOP stack;

2. one (1) annular BOP and one (1) ram BOP shall be installed at the surface casing; and only one (1) annular BOP may be fixed at the surface casing with the size over 13”3/8;

3. one (1) annular BOP, one (1) double ram type preventer (or two (2) single ram type preventers), and one (1) all shear ram BOP shall be installed at the intermediate casing; and

4. where the combined type drill string is used, a variable ram block shall be installed so as to be adapted to different sizes of drilling tools.

Article 56 The surface BOP stack shall be opened and closed in accordance with the following provisions:

1. the ram BOP shall be opened and closed at regular intervals;

2. after pulling out hole, the open-and-close switch of the all shear ram BOP shall be taken. It’s no need to switch more than once each day;

3. the two (2) control panels of BOP shall exchange operations once for each pulling out of hole and running in hole. In case any control panel malfunctions, the drilling operation shall be

ceased; and

4. the valve of choke manifold, kelly cock, and internal BOP shall be opened and closed once a week.

The frequency of open and close of subsea BOP, other than the ram BOP which shall be opened and closed once a day, shall be the same as that of the surface BOP stack.

Article 57 The pressure test of the BOP system shall be carried out in accordance with the following provisions:

1. the low pressure test of 2.1 MPa shall be carried out for any BOP and manifold before the high-pressure test of such BOP and manifold;

2. the overall pressure test shall be carried out before the BOP is installed, or after any main part is replaced;

3. the BOP pressure test shall be carried out in the order of workshop (base) firstly, secondly on location installation and thirdly before drill-out to the reservoir or replacement of any part of well control device. The period between twice pressure tests shall not exceed fourteen (14) days;

4. in the case of surface BOP stack, the pressure test shall be carried out under the rated working pressure after it is installed in the workshop (base). After the on location installation is completed, the test pressure of the annular BOP shall be seventy percent (70%) of the rated working pressure and the test pressure of the ram BOP and corresponding controlling equipment shall be equal to the rated working pressure, under the premises that the test pressure does not exceed eighty percent (80%) of the casing burst strength; and

5. in the case of subsea BOP stack, the pressure test and all the corresponding well control equipment shall be seventy percent (70%) of the rated working pressure. After the on location installation of the BOP stack is completed, the pressure test of the controlling equipment and ram block shall be carried out according to the provisions on the pressure test of surface BOP stack.

Article 58 Inspection and maintenance of the BOP system shall comply with the following provisions:

1. the entire BOP system, water string (conductor pipe), and auxiliary equipment shall be inspected and maintained in accordance with the procedures as recommended by the manufacturer;

2. based on the sea and weather conditions, the exterior inspections of the BOP system and water string (conductor pipe) shall be carried out at least once every day, and the underwater equipment may be inspected by utilizing underwater televisions.

Article 59 The device for detecting the mud level in the bath and gas shall have the sound and light alarming function, and the alarm thereof shall be installed on the drill floor and in the compound logging room; and the mud property testing instrument shall be provided. The volume of mud shall comply with the following provisions:

1. before spud-in, the minimum demand of mud materials shall be calculated, and additional mud shall be available on the emergency condition;

2. the daily storage volume of mud materials (including weighting materials) shall be recorded and kept. In the event that the storage volume is less than the specified minimum, the drilling shall have to be terminated;

3. when the density of the reversed out mud is 0.02 g/cm3 lower than that of the filled in mud in the process of the operation, the mud in the annular shall be circulated to the ground surface so as to carry out the gas or fluid influx inspection and treatment on the well fluid performance;

4. the mud shall be pumped into the well when the drilling strings trip out of the well. The hole shall be fully filled with the mud when the still fluid level falls or each three (3) to five (5) joints have been pulled out of the hole; and

5. before the drill stem test tool trips out of the well, circulation or reverse circulation of the mud shall be carried out.

Article 60 The well completion, well testing, and workover shall comply with the following provisions:

1. be equipped with suitable and corresponding BOP and its control system for the operation;

2. the mud materials shall be stored according to the plan, the mud materials and property shall meet the requirements of the operations;

3. the well control shall be carried out in accordance with relevant provisions on the drilling operation; and

4. at least one (1) well control system is equipped to installations/facilities at beach and alongshore.

Article 61 The down-hole packer shall be fixed in the gas wells, blowing and flowing wells; and safety valve shall be set thirty (30) meters below the sea floor and comply with the following provisions:

1. the on-site test of surface controlled downhole safety valve shall be carried out regularly and the intervals between any two tests shall not exceed six (6) months. The test of the surface controlled downhole safety valves which are fixed newly or refixed shall be carried out;

2. the subsurface controlled downhole safety valve shall be installed in each individual wells, satellite wells, and multiple wells completed on the seabed.

3. the surface safety valve shall be kept in a good working condition; and

4. the applicable wellhead pressure testing and stuffing box shall be provided.

The emergency shutdown system shall be kept in a good working condition. Operators shall properly keep all the records and other materials of subsea safety equipment on the process of the installation and debugging.

Article 62 The pressure test of BOP manifold shall be carried out before the tools run in into the well during the operation of cable perforation, production logging, or wireline operation.

Article 63 The low pump stroke and pumping pressure tests shall be carried out before the drill bit reaches the depth of one hundred (100) meters away from the hydrocarbon reservoir.

Article 64 The relief line shall use special pipelines.

In cold season, measures of anti-freezing and heat preservation shall be taken for the well control equipment, BOP manifold, choke manifold, pressure manifold, and instrument.

Section 6 Management of Protection against Hydrogen Sulfide(H2S) Article 65 When drilling to the unknown stratum containing H2S, precautionary measures shall be taken in advance; and when drilling to the known stratum containing H2S, detection and control shall be carried out.

The H2S detection and alarm system shall comply with the following provisions:

1. the H2S alarm system shall be installed on the drilling unit and it shall be able to work by means of sound and light alarm when the concentration of H2S in the air exceeds fifteen (15) mg/m3 (ten (10) ppm); stationary probes shall be fixed at the bellmouth, drill floor, reciprocating screen, mud ditch, living area, and the air inlet of generator room and switching room;

2. at least one (1) set of H2S detector with the detection range between zero (0) to thirty (30) mg/m3 (or between zero (0) and twenty (20) ppm) and one set of H2S detector with the detection range between zero (0) to one hundred and fifty (150) mg/m3 (or between zero (0) and one hundred (100) ppm) shall be provided;

3. the sensitivity of the detection parts shall reach 7.5 mg/m3 (five (5) ppm); and

4. sufficient H2S samples shall be stored so as to check and test the detection probe at any time.

The personal protective equipment shall comply with the following provisions:

1. under usual circumstances, the drilling unit shall be equipped with fifteen (15) to twenty (20) sets of positive pressure air breathing apparatus, of which six (6) to nine (9) sets shall be provided for the living area, five (5) to six (6) sets for the drill floor, two (2) sets for the area near the mud ditch (mud pit), and two (2) to three (3) sets for the logging room. Before drilling into the known stratum containing H2S, or when unexpectedly drilling to the stratum containing H2S, all staff working on the drilling unit shall be provided with positive pressure air breathing apparatus and sufficient stand-by air bottles;

2. the drilling unit shall be equipped with an air compressor for breathing apparatus; and

3. the clinic shall be equipped with medical supplies, heart-lung resuscitators, and oxygen cylinders for handling H2S poisoning.

Marking signals shall comply with the following provisions:

1. a wind vane and wind velocity indicator shall be installed at a readily visible place;

2. a green board marked with H2S shall be hung out when the concentration of H2S in the air exceeds fifteen (15) mg/m3 (ten (10) ppm);

3. a yellow board marked with H2S shall be hung out when the concentration of H2S in the air is between fifteen (15) and thirty (30) mg/m3 (or between ten (10) and twenty (20) ppm); and

4. a red board marked with H2S shall be hung out when the concentration of H2S in the air exceeds thirty (30) mg/m3 (twenty (20) ppm).

Article 66 The following protective measures against H2S shall be taken in drilling for the stratum possibly containing hydrogen sulfide:

1. in the well design, the stratum possibly containing H2S and the depth of the stratum shall be shown, and the content of the possible H2S shall be estimated so as to remind relevant operators to take necessary safety and emergency measures;

2. when the concentration of H2S in the air exceeds fifteen (15) mg/m3 (ten (10) ppm), all the persons on the platform shall be notified in a timely manner, the frequency of observation and detection of the concentration of H2S shall be increased, and the positive pressure air breathing apparatus shall be inspected and made ready;

3. when the concentration of H2S in the air exceeds thirty (30) mg/m3 (twenty (20) ppm), all the persons on duty must use the positive pressure air breathing apparatus and other persons on the platform shall go to the safety area. Informing the stand-by vessel to weigh anchor for orders at the up-wind sea area of the platform;

4. when the concentration of H2S in the air exceeds one hundred and fifty (150) mg/m3 (one hundred (100) ppm), the evacuation of all the persons from the platform shall be organized;

5. the suitable mud for the stratum containing H2S shall be used and the pH value of the mud shall be kept above ten (10). The scavenging, additive, and antiseptic agents shall be moderately stored. The H2S from mud shall be discharged in a concentrated way or may be burnt if circumstances permit.

6. when drilling to the stratum containing H2S, the drill pipe wiper shall be used in the process of tripping out of hole. If the wet drill stem is laid on the deck, operators shall wear the positive pressure air breathing apparatus when necessary. When H2S is found in the process of drilling, the concentration exceeds thirty (30) mg/m3 (twenty (20) ppm), the drilling shall be suspended immediately and the mud shall be kept on circulation;

7. in the process of coring in the stratum containing H2S, the operators shall wear the positive pressure air breathing apparatus when the core barrel will be tripped out before ten (10) or twenty (20) stands are left and the core is taken out of the core barrel. When the drill core containing H2S is delivered, relevant packing measures shall be taken to seal up the drill core, and the H2S shall be marked on the package. In case the H2S is found in logging fluid, the drilling superintendent shall be informed in a timely manner;

8. the drillstem test in the stratum anticipated to contain H2S shall be conducted during the daytime, and there shall be limited number of the operators near the test equipment and tools. Normal drill stem test tools should not be used to test the stratum containing H2S in the deep part;

9. after the stratum containing H2S is pierced, the frequency of monitoring over the work area shall be increased, and the monitoring over H2S shall be strengthened; and

10. in the case of well testing in the stratum containing H2S, a safety meeting shall be conducted in advance to ensure that the personal protective equipment, emergency equipment and procedures are available. The number of operators shall be minimized near the well testing equipment.

Article 67 In the process of drilling operation in the stratum containing H2S, the drilling equipment and apparatus shall comply with the following provisions:

1. the drilling equipment and apparatus shall be able to resist sulfur stress cracking;

2. tubular goods shall be competent to be used in the environment of hydrogen sulfide, and shall be used in accordance with relevant standards; and

3. the equipment, tubes, pipes, production flow, and accessories shall be inspected and detected at regular intervals.

Article 68 The protection against H2S during the operations of well completion and workover shall comply with relevant requirements on drilling.

Article 69 In the process of the production operation in the stratum possibly containing H2S, the following measures of protection against H2S shall be taken:

1. the production installations/facilities shall be equipped with six (6) sets of positive pressure air breathing apparatus. On the installations/facilities where there is sulfur-bearing oil or gas, all the persons on the installations/facilities shall be equipped with the positive pressure air breathing apparatus. A certain number of stand-by air bottles and one (1) air compressor for breathing apparatus shall be provided;

2. the installations/facilities shall be equipped with two (2) or three (3) sets of portable H2S detectors, one (1) portable color comparison tube detector, and one (1) sulfur dioxide detector. The H2S alarm device shall be installed on the production units where there is H2S;

3. when the concentration of H2S in the air exceeds fifteen (15) mg/m3 (ten (10) ppm) or the concentration of sulfur dioxide in the air exceeds 5.4 mg/m3 (two (2) ppm), operators shall wear the positive pressure air breathing apparatus;

4. the medical supplies for treating H2S poisoning, heart-lung resuscitator, and oxygen bomb shall be provided for the production installations/facilities;

5. before the oil or gas well is put into production, effective measures shall be taken to strengthen

the protection against sulfuratted hydrogen, sulfur dioxide, and carbon dioxide; and

6. relevant production facilities and pipelines shall have a good resistance against corrosion of H2S.

Section 7 Management of Lifting and Rigging Article 70 Operators and contractors shall strengthen safety management of lifting and rigging.

Article 71 Operators and contractors shall establish a system of responsibility for the safety management of lifting and rigging, and clarify the each post responsibility; and shall formulate management provisions on the use of rigging and regularly maintain rigging. Records on the maintenance of rigging shall be kept and signed by relevant persons.

Article 72 The rigging shall be inspected, recorded, and marked by the inspection authority approved by COOOSO in accordance with relevant provisions. Where operators or contractors manufacture rigging by themselves in order to meet special demands, the rigging concerned shall be subject to the inspection by the inspection authority approved by COOOSO before ready for service.

Article 73 The handling of container and its spare parts shall meet the following provisions in addition to Article 71 and Article 72:

1. the signs of specification, dead weight and rated safe loading of the container shall be marked on outside of the container; and

2. the main force-bearing parts thereof shall be inspected at regular intervals.

Article 74 The use of cargo net shall comply with the following provisions in addition to Articles 71 and 72 of the Regulations:

1. the safe working load shall be marked on the net; and

2. the non-metal net shall not be used beyond its applicable scope or environment.

Article 75 The transfer basket shall only be used for carrying crew, and marked with the rated load and limitation on the number of persons carried on; and it shall be inspected at regular intervals according to the product specifications.

Article 76 The rigging shall be ceased to use under any of the following circumstances:

1. where the rigging does not meet the standards but is still in use.

2. where the inspection date is not marked; or

3. where the rigging fails to be inspected within the inspection period.

Section 8 Management of Hazardous Articles Article 77 Operators and contractors shall establish the system on receiving and returning radioactive and explosive articles (hereinafter referred to as the “hazardous articles”). Hazardous articles shall be received and returned in accordance with the following provisions:

1. the receiver shall present the receipt note upon receipt of relevant hazardous articles, and the type and quantity of hazardous articles shall be recorded in the receipt note;

2. special tools shall be used to receive and return hazardous articles. The radioactive source and shall be contained in a close container, and explosive articles shall be stored in a trunk;

3. a floating buoy or any other position indicator shall be provided for the can storing the radioactive source when the can is stocked in or out;

4. records shall be made for the stock-in/stock-out of hazardous articles, and the receiver concerned and warehouse keeper shall sign on the stock-in/stock-out note; and

5. unconsumed hazardous articles shall be returned in a timely manner.

Article 78 The transportation of hazardous articles shall comply with the following provisions:

1. the transportation shall meet the requirements of relevant laws, regulations, rules, and standards, and shall be escorted by the person specially designated;

2. reliable safety measures and emergency measures shall be available for the transportation; and

3. relevant transportation formalities shall be abided by, and the hazardous article sign shall be marked.

Article 79 The usage of hazardous articles shall comply with the following provisions:

1. the use permit shall, prior to relevant operation, be applied for in accordance with relevant provisions. Hazardous substance may only be used after the use permit has been obtained. Detailed records shall be made for the use of hazardous substance. Unconsumed hazardous substance shall be returned to warehouse;

2. safe and reliable operating specifications shall be established for operation, and the operator concerned shall be familiar with and abide by the operating specifications;

3. a visible warning mark shall be put up at the site of operation so as to prevent any person other than the operators from entering the operating area;

4. at least one (1) portable radioactivity rate meter shall be provided on the site of operation; and

5. the performance of radioactive sources and the container carrying such sources shall be inspected in accordance with relevant national standards.

Article 80 The storage of hazardous substance shall comply with the following provisions:

1. the storage place thereof shall be far away from living areas, areas with dense population, and hazardous areas, and it shall be marked with the sign of “Hazardous Substance”;

2. effective fire-fighting measures shall be taken; and

3. no dynamite of explosive articles shall be stored with detonators or radioactive substance in the same warehouse.

Article 81 The disabled radioactive source or the radioactive source (with the radioactivity of over 185 Bq) failing to pass the shell leakage test shall be treated in a safe way.

Article 82 Where operators use radioactive articles, the following protective measures shall be taken:

1. the operators shall be equipped with a personal irradiation dose detector, and irradiation dose files shall be established;

2. at least one physical examination shall be given to the operators every year, and the physical examination results shall be kept in the archives;

3. in case any operator is damaged by the radioactive articles, the operator concerned shall leave the current post immediately, and therapy and rehabilitation shall be given to the operator concerned; and

4. where an operator leaves his current post, his irradiation dose files and physical examination files shall be transferred along with him.

Section 9 Management of Well Abandonment Article 83 Well abandonment shall be filed with the relevant authority. Operators or contractors shall, 30 days prior to the well abandonment or cleaning the remains around the wellhead, submit the following materials to the Relevant Offshore Oil Safety Branch:

1. safety risk assessment report on the well abandonment or cleaning of remains around the wellhead; and

2. working scheme, job procedures, and time schedule on the well abandonment or removing of remains around the wellhead and the property of well fluid.

The Relevant Offshore Oil Safety Branch shall examine the above materials submitted by the operator or contractor concerned; and shall, if any content of the materials fails to meet relevant technical requirements, notify the operator or contractor concerned to make rectification and improvement.

Article 84 During the period of well abandonment or cleaning of remains around the wellhead, the Relevant Offshore Oil Safety Branch shall carry out onsite supervision when it is necessary.

The operator or contractor concerned shall, within fifteen (15) days after the completion of the well abandonment or cleaning of remains around the wellhead, submit the following materials to the Relevant Offshore Oil Safety Branch:

1. the operation finished plan; and

2. the final report table of well abandonment.

Article 85 Permanent well abandonment shall comply with the following provisions:

1. at the open hole section, the oil, gas and water permeable formations shall be totally sealed off and a cement plug at least fifty (50) meters shall be made at its top so as to seal off the oil, gas and water permeable interval and prevent the oil, gas or water interbedded channeling and flow into seabed. In case there is no oil, gas or water at the open hole section, a cement plug at least thirty (30) meters at top and bottom of the last casing shoe shall be made respectively;

2. if the tail pipe has been run in the hole, a cement plug at least thirty (30) meters at the top and bottom of the same tail pipe shall be made respectively;

3. if perforation and well testing has been carried out in the casing or tail pipe, the perforated zone shall be totally sealed off, and a cement plug at least fifty (50) meters shall be made for totally seal off;

4. in each cut casing of every formation, a cement plug at least twenty (20) meters at the top and bottom of cutting shall be made respectively; and

5. the cement plug in the surface casing shall not be shorter than forty-five (45) meters, and the top of the cement plug shall be four (4) to thirty (30) meters below the level of mud layer of seabed.

Temporary well abandonment shall meet the following provisions:

1. a cement plug with the length of at least fifty (50) meters under the deepest casing string shall be made; and

2. a cement plug with the length of at least thirty (30) meters shall be made downward in the casing string from the part which is four (4) meters below the level of mud on the seabed.

Article 86 In the case of permanent well abandonment, all the casings and wellhead devices or poles shall be removed in accordance with relevant provisions. The underwater wellhead or wellhead cap retained on the seabed shall be reported to the Relevant Offshore Oil Safety Branch in accordance with relevant provisions.

Chapter IV Safety Training Article 87 The organization undertaking the safety training for offshore oil operation staff shall lawfully obtain the safety training qualification certificate issued by the State Administration of

Work Safety.

Article 88 The principal and other relevant safety management staff shall participate in the safety training and shall take the working positions only after passing the examinations on the safety production knowledge and management ability organized by COOOSO.

Article 89 Operators and contractors shall organize the offshore oil operation staff to participate in the safety training. The offshore oil operation staff failing to pass the examination of safety training organized by the safety training organization with the training qualification shall not take the working positions.

Operators and contractors shall establish training files for the offshore oil operation staff and strengthen the inspection on the training certificates of the operation staff (including those participating in the training abroad). No operation staff failing to obtain the training certificate may carry out offshore operations.

Article 90 The crew on offshore oil installations/facilities must receive special training of “Safety & Survival Training to Offshore Oil Operation” and obtain the training certificate issued by the qualified training organization.

The safety training shall meet the following requirements in the respects of contents and time:

1. the crew on offshore oil installations/facilities on a long-term basis shall receive the full training on “Life saving for the Safety of Offshore Oil Operations”, and the training time shall be no less than forty (40) class hours. Such training shall be attended once every five (5) years;

2. the crew on offshore oil installations/facilities on a short-term basis shall receive the training on the comprehensive contents of “Life Saving for the Safety of Offshore Oil Operations”, and the training time shall be no less than twenty-four (24) class hours. Such training shall be attended once every three (3) years;

3. the crew on offshore oil installations/facilities on a temporary-term basis shall receive the computer-based training on “Life Saving for the Safety of Offshore Oil Operations”, and the training time shall be no less than four (4) class hours. Such training shall be attended once every year;

4. the crew on offshore oil installations/facilities on a temporary term basis who are not lodged on offshore installations/facilities may only receive the on-site safety training given by the operator or contractor concerned;

5. the crew working on the no-helicopter-deck platform may be exempt from the training on “Helicopter Underwater Escape Training”

6. the crew carrying out operations on offshore installations/facilities without equipment of life saving boats or rafts may be exempt from training on “maneuvering Life Saving Boats and Rafts”.

Article 91 On-call firemen on offshore installations/facilities shall receive the training of “Oil and Gas Fire Fighting”, and the training time shall not be less than twenty-four (24) class hours. Retraining of such program shall be carried out once every four (4) years.

Article 92 The supervisor, manager, senior toolpusher, foreman, driller, assistant driller, derrick man, and the safety supervisor of drilling, completion, workover, and testing operation shall receive the training of “Well Control Technology” for at least fifty-six (56) class hours and obtain the training certificate issued by the qualified training organization. Retraining of such program shall be carried out once every four (4) years.

Article 93 The stability and ballast operators (including technicians working on the drilling platform and FPSO for stability and ballast work, and technicians working on the drilling platform for lifting and lowering the platform) shall receive the training of “Technology of Stability and

Ballast” for at least thirty-six (36) class hours and obtain the training certificate issued by the qualified training organization. Retraining of such program shall be carried out once every four (4) years.

Article 94 Staff carrying out drilling, completion, workover, testing operation, oil extraction, or storage and transportation operation in the place where the H2S exists or possibly exists shall receive special training of “Techniques of Protection against H2S” for at least sixteen (16) class hours, and obtain the training certificate issued by the training organization with qualification. Retraining of such program shall be carried out once every four (4) years.

Article 95 Radio technology operators shall receive the training in accordance with the requirements of the competent government agency and obtain corresponding certificates.

Article 96 Special-work operators shall receive training in accordance with the requirements of laws and regulations and obtain special qualification certificates.

Article 97 The certificates obtained by foreign staff which are issued by a training organization legally registered and approved by the government abroad, shall be valid in China, and be subject to the confirmation by the Chinese operator or contractor concerned.

Chapter V Emergency Management Article 98 Operators and contractors shall, according to the actual production conditions, make the contingency plan in accordance with the requirements of relevant laws, regulations, rules, and codes and submit the contingency plan to the Relevant Offshore Oil Safety Branch for filing.

Operators and contractors shall, according to the changes of offshore oil operation, modify, supplement and improve the contingency plan in a timely manner.

Article 99 In view of the characteristics of offshore oil operation, the contingency plan prepared by an operator or contractor shall cover the following contents:

1. basic information of the operator or contractor, hazardous characteristics, and emergency and rescue equipment available;

2. the organization chart, duties, and contact information;

3. procedures of handling the contingency plan start-up, response, information processing, suspension of emergency and subsequent recovery; and

4. emergency drill and training.

Article 100 The emergency conditions as covered in the contingency plan include blowout out of control, fire, explosion, distress of platform, helicopter crash, marine loss of vessel, breakage and leakage of oil (gas) vessel and pipelines, leakage of poisonous and hazardous substances, scattering of radioactive articles, diving accident; serious injury, death, disappearance, volcanic infectious disease, and poisoning of persons; oil spill, natural disaster, and other emergencies.

Article 101 Operators and contractors shall, in combination with the actual situation of the work, prepare the contingency plan with respect to every production and operation installation in addition to the top-level contingency plan of the company. The contingency plan shall include two parts: main part and appendix part.

The main part shall include the following items:

1. names of the operator and operation installations/facilities, operating sea area, the author and the date;

2. the emergency team, command system, medical institutions, and duties of posts at various levels of the production and operation installations/facilities;

3. programs for dealing with various emergency accidents or perils and the contacting and reporting procedures;

4. the type, capacity, and emergency communication frequency of the communication apparatus on the production and operation installations/facilities;

5. the contact information, including the mailing address, telephone number, and fax, of principals of the emergency agency, the higher competent agency, and relevant agencies;

6. the emergency contact network chart;

7. content, frequency, and requirements of emergency drills; and

8. other issues required to be specified.

The appendix part shall cover the following items:

1. major basic data of the production or operation installations/facilities;

2. descriptions of the natural environment around the production and operation installations/facilities, including meteorological data, possible disastrous weather (such as typhoon); oceanographic hydrological data in the operation sea area, such as the depth of water, water temperature, velocity and direction of the ocean current, and wave height; and the general sketch describing the locations of the production and operation installations/facilities, land-bank base, surrounding harbors and ports, and other offshore installations/facilities in the area;

3. names, types, quantity, functions, and storage places of various emergency search and rescue equipments and materials;

4. specifications and models of the equipments provided on the production and operation installations/facilities for measuring weather and sea conditions; and

5. other relevant information.

Article 102 Operators and contractors shall organize the relevant personnel of production and operation installations/facilities to carry out the regular drills according to the contingency plan, and the frequency of such emergency drills shall comply with the following provisions:

1. the fire fighting drill shall be organized once every shift;

2. the platform abandonment drill shall be organized once every shift;

3. the well control drill shall be organized once every shift;

4. the drill on rescuing persons falling into sea shall be organized once every three months; and

5. H2S drill: at least one H2S drill shall be organized before drilling into the stratum containing H2S or prior to the well testing or workover for the oil (gas) well containing hydrogen sulfide; the H2S drill shall be organized once every seven days in the process of normal drilling, well testing or workover for oil (gas) well containing H2S; and the H2S drill shall be organized once for each shift in the production of oil (gas) well containing H2S. In the case of oil (gas) well containing no H2S, the H2S drill shall be organized once every half year.

Records for all emergency drills shall be kept for at least one year.

Article 103 Where an accident happens, the on-site personnel shall report to the operator or contractor in a timely manner; the operator or contractor concerned shall, upon receipt of the reporting, launch a corresponding contingency plan immediately and organize the rescue activities to prevent the accident from expanding and to reduce personal casualties and property losses.

Article 104 In the process of offshore emergency rescue, according to the nature of the accident, the operator or contractor concerned shall:

1. protect the operating personnel and organize evacuation from the operation installation immediately;

2. assemble emergency manpower on the installation to carry out the rescue immediately, and simultaneously appeal relevant agencies to mobilize available resources, including the additional manpower, equipment, apparatus, materials, and necessary logistic support;

3. make an onsite rescue scheme, and organize the implementation of the scheme;

4. make the area alert and controlled;

5. take corresponding protective measures to prevent the accident from expansion and triggering any secondary disaster;

6. organize medical aid force to rescue injured persons quickly; and

7. prevent oil from leaking or spreading at a large scale.

Chapter VI Reporting and Investigation of Accidents Article 105 In case of any of the following accidents in such operations as exploration, exploitation, production, storage & transportation of offshore oil/gas or abandonment of oil fields, relevant persons on location shall report to the operator or contractor in a timely manner; and the operator or contractor concerned shall, upon receipt of the reporting, report to the regional supervisory organization of the Relevant Offshore Oil Safety Branch, local government, and maritime authority in accordance with relevant provisions.

1. blowout out of control;

2. fire and explosion;

3. distress of platform (including the platform drifting out-of-control, towing accidents, collision or capsizing of a vessel);

4. aviation accidents;

5. marine loss of vessels (including collision, stranding, grounding, capsizing, and rupture of a vessel);

6. rupture f oil (gas) production installations/facilities and pipelines (including breakage, leakage, rupture of the single point mooring, electric cable and pipeline and submarine oil (gas) pipeline);

7. release of poisonous and hazardous substances and gas;

8. acute poisoning;

9. diving accident;

10. oil spill accident at a large scale; (the amount of oil spillage is more than one hundred (100) tons);

11. any other accident causing serious injury or death or direct economic loss.

Article 106 The local supervision organization of the Relevant Offshore Oil Safety Branch shall, after the receipt of the report of any above accidents, reports to the Relevant Offshore Oil Safety Branch immediately. The Relevant Offshore Oil Safety Branch shall, after the receipt of the report of a relatively major accident or any of the above accidents, reports to the State Administration of Work Safety within one hour.

The aviation accident, marine loss of vessel, and oil spillage accident at a large scale shall be reported to the local government, in addition to COOOSO, in accordance with relevant provisions.

Article 107 The accidents on offshore installations/facilities shall be investigated in accordance with the following provisions:

1. in the case of an accident having no personal injury or death, the Relevant Offshore Oil Safety Branch may authorize the operator or contractor concerned to form an accident investigation team made up of the personnel in the respects of production, technique, and safety as well as the labor union members to carry out the investigation;

2. in the case of an accident causing personal injury or death, an accident investigation team, made up of relevant agencies and the labor union, shall be formed under the leadership of the Relevant Offshore Oil Safety Branch to carry out the investigation, and the competent People's Procuratorate shall be invited to participate in the investigation;

3. in the case of a relatively severe accident, an accident investigation team, made up of relevant agencies, shall be formed under the leadership of COOOSO to carry out the investigation, and the competent People's Procuratorate shall be invited to participate in the investigation;

4. in the case of a major accident, an accident investigation team, made up of relevant agencies, shall be formed under the leadership of the State Administration of Work Safety to carry out the investigation, and the competent People's Procuratorate shall be invited to participate in the investigation; or

5. in the case of an extraordinarily severe accident, the relevant provisions of the State Council shall be implemented.

The investigation of such accidents related to offshore oil installations/facilities as aviation accidents, marine loss of vessels, lost of radioactive substances, and oil spillage with a large scale shall be organized and dealt with by relevant authorities of civil aviation, maritime affairs and environmental protection.

Article 108 Official replies to the investigation report on offshore oil accidents shall comply with the following provisions:

1. in the case of an ordinary accident, the Relevant Offshore Oil Safety Branch may, upon the approval of COOOSO, give an official reply to the investigation report;

2. in the case of a relatively major or major accident, the official reply to the investigation report shall be given by the State Administration of Work Safety; or

3. the official reply to the investigation report of an extraordinarily serious accident shall be given in accordance with relevant provisions of the State Council.

Article 109 Operators and contractors shall deal with the person held liable for the accident as per the official reply to the accident investigation report.

The organization to which the accident occurred shall draw a lesson from the accident and put precautionary and rectification measures into effect so as to prevent the similar accident from reoccurring.

Chapter VII Administration of Supervision Article 110 COOOSO and the Relevant Offshore Oil Safety Branches shall supervise the production safety of organization undertaking offshore oil production and operation in accordance with laws, regulations, rules, and standards.

Article 111 The Relevant Offshore Oil Safety Branch shall establish the system on the record filing of production, operation and extended testing installations/facilities, and abandoned wells. And the record files of the previous year shall be submitted to COOOSO before the January 31 of each year, and shall be kept for at least three (3) years.

Article 112 The Relevant Offshore Oil Safety Branch shall supervise the safety training organized by safety training organizations, operators, or contractors.

Article 113 According to the official reply of the production accidents, COOOSO and the Relevant Offshore Oil Safety Branches shall impose administrative penalties on the organization to which the accident occurred and on the personnel concerned in accordance with the provisions of relevant laws, administration regulations and rules; the government officials liable for the accident shall be treated by relevant authorities or administrative supervisory organizations according to the government officials’ administrative authorities management regulations.

Chapter VIII Penalty Provisions Article 114 Should an operator or contractor concerned engage in any of the following acts, they shall be given a warning and may be simultaneously imposed a penalty less than thirty thousand yuan:

1. fail to go through the record filing procedure in accordance with relevant provisions with respect to production installations/facilities, operation installations/facilities, extension test installations/facilities and well abandonment;

2. fail to provide the stand-by vessel or failing to make the stand-by vessel registered in accordance with relevant provisions;

3. fail to make the inspection of offshore specialized equipments as scheduled; or

4. refuse or obstruct the supervision and inspection by COOOSO or the Relevant Offshore Oil Safety Branch in accordance with the law.

Article 115 Should an operator or contractor concerned engages in any of the following acts, they shall be suspended from production and make rectification. And administrative sanctions shall be imposed on them accordingly:

1. fail to implement the procedure of the “three simultaneousness” with respect to newly constructed, reconstructed or extended projects; or

2. fail to make rectification with respect to potential hazards within the required time.

Article 116 Where any supervisor or inspector from COOOSO or the Relevant Offshore Oil Safety Branch misuses authority, neglects, or conducts illegal transactions in the process of offshore oil supervision or inspection, administrative sanctions shall be imposed upon the supervisor or inspector in accordance with relevant provisions.

Chapter IX Supplementary Provisions Article 117 The following terms as referred to in the Regulations shall be defined as follows:

1. offshore oil installations/facilities refer to the installations/facilities used for the offshore oil operation and production, including the offshore mobile drilling vessel (platform), geophysical survey vessel, pipelaying vessel, floating crane, well cementing vessel, and acidification fracturing vessel;

2. offshore oil exploration and production installations/facilities refer to offshore and shore lands structures used to develop offshore oil exploration and production, including offshore fixed platforms, single point moorings, FPSO, submarine pipelines, offshore oil transportation terminals, oil installations/facilities at beach and alongshore, artificial islands, and oil terminals on shore lands;

3. oil installations/facilities at beach and alongshore refer to the related oil installations/facilities

within the shallow sea below the highest astronomical tide (HAT) and the roads or shore bridges connecting the oil installations/facilities to shore lands;

4. specialized equipments refer to the equipments which are dangerous in terms of being used in the process of offshore oil exploration and production or have significant impact on the safety production, including offshore structures, oil production equipments, offshore boilers, pressure vessels, drilling and workover equipment, hoisting and lifting cranes, fire and gas detector, alarm and control systems, safety valves, life saving appliances, fire control equipment, rigging such as the wire rope , and electric instruments;

5. a subsea oil (gas) pipeline refers to the long-distance pipeline from a oil (gas) export metering station on the offshore oil (gas) field to the onshore terminal or the offshore oil (gas) terminal, including such connection systems as pipelines, risers, accessories, control systems, instruments and supporting structures as well as relay pump stations;

6. for the purpose of collecting the exact reservoir and geological data, extended testing operations will be carried out on the original drilling rig and the wellhead platform, with the oil tanker or floating production unit as the oil storage;

7. extended testing installations/facilities refer to the oil tanker, floating production unit and auxiliary processing equipments which are temporarily installed on the original drilling rig or wellhead platform in the process of extended testing operation;

8. the crew on offshore oil installations/facilities on a long-term basis refer to the personnel who carry out the offshore operations, management and maintenance for at least fifteen (15) (inclusive) days each shift or at least thirty (30) (inclusive) by accumulation in a year;

9. the crew on offshore oil installations/facilities on a short-term basis refer to the personnel who carry out the offshore operations for five (5) (inclusive) to fifteen (15) (exclusive) days each shift or for ten (10) (inclusive) to thirty (30) (exclusive) days by accumulation days in a year;

10. the crew on offshore oil installations/facilities on a temporary term basis refer to the personnel who carry out the offshore operations less than five (5) (inclusive) days each shift or less than ten (10) (inclusive) days by accumulation in a year;

11. on-call firemen at the offshore oil (gas) production installations/facilities refer to key personnel who operate fire fighting equipment and conduct fire fighting work on location;

12. the “Safety & Survival Training to Offshore Oil Operation” refers to a five-item safety training program, namely “Survival at Sea”, “Firefighting at Sea”, “Lifeboat & Liferaft Operation”, “First Aid at Sea”, and “Helicopter Underwater Escape”;

13. well abandonment operations refer to a series of measures adopted for preventing marine pollution and ensuring the safety of marine transportation. Well abandonment operations include permanent well abandonment operations and temporary well abandonment operations. Permanent well abandonment refers to the operations of plugging the well hole and recovering wellhead devices; temporary well abandonment refers to the operations of plugging the well hole, putting on a wellhead cap, and setting up a sign of wellhead for a well which is suspended from operating for some reason or for the completed wells.

Article 118 The forms of relevant documents as specified in the Regulations shall be in line with COOOSO requirements.

Article 119 Relevant provisions of the Regulations shall be applied by reference for purposes of safety management for oil exploration and production in inland lakes.

Article 120 The Regulations shall be implemented as of December 1, 2009.