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ComplianceGlossary Term

LOTO (Lockout/tagout)

A mandatory safety procedure requiring subcontractors to physically lock and label energy sources before servicing equipment. It prevents accidental startup during maintenance work. Site operators often require proof of worker LOTO certification before mobilisation.

Related Terms

Hazmat-Permitted Storage

Compliance

Designated facilities licenced to store hazardous materials such as fuel, chemicals, or drilling fluids under strict regulatory approval. Subcontractors must verify their storage sites hold valid permits before mobilising hazardous goods to a worksite. Non-compliance can trigger project shutdowns, fines, or loss of contract eligibility.

Prequalification

Compliance

A vetting process where operators assess a subcontractor's safety record, insurance, and certifications before awarding work. Companies must pass prequalification to be added to an approved vendor list. Failing or lapsing can disqualify a subcontractor from bidding on projects entirely.

Fixed Ladder Safety System

Compliance

A fall-arrest assembly attached to a fixed ladder, typically including a rail or cable that a climber's harness connects to. Required on ladders exceeding specified heights at most oil and gas and construction sites. Subcontractors must verify worker training and compatible harness equipment before mobilising to sites with these systems.

OFAC (Office of Foreign Assets Control)

Compliance

A U.S. Treasury agency that enforces sanctions against designated countries, companies, and individuals. Subcontractors must screen clients and vendors against OFAC lists before accepting contracts or payments. Working with a sanctioned party can result in severe fines and contract termination.

Flaring

Compliance

The controlled burning of excess natural gas at a wellsite or facility. Subcontractors working on-site must follow strict flaring protocols, as ignition hazards affect work permits and safety zones. Flaring activity can also trigger regulatory hold points that delay field operations.

Approved Vendor List

Compliance

A client- or prime contractor-maintained registry of pre-qualified suppliers and subcontractors eligible to bid on work. Getting onto an AVL often requires submitting safety records, insurance, and certifications in advance. Without AVL status, subcontractors are typically blocked from receiving purchase orders or contracts.

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