us national academy of sciences performance and...

Meeting with

US National Academy of Sciences Performance and Management Based Safety Regulatory Regimes in the North Sea Offshore Oil&Gas Sector The Hague, 5 January 2017

79 Members around the world representing 1/3 of world oil and gas production

Anadarko

API

Baker Hughes

CAPP

Chevron

CNR International

ConocoPhillips

Devon Energy

ExxonMobil

Hess Corporation

Husky Energy

IADC

IAGC

Kosmos Energy

Marathon Oil

Noble Energy

Pemex

Schluberger

Suncor

Talisman Energy

North America

35 members active in region

Afren plc

ASSOMMINERARIA

BG Group

BP

Cairn Energy

DONG Energy

E.ON Ruhrgas AS

Energy Institute

Eni

Fairfield Energy

GALP Energia

Genie

IECO

IOOA

IPIECA

Maersk Oil

MOL plc

NOGEPA

Norwegian Oil & Gas

Oil Gas Denmark

Oil & Gas UK

OMV

Perenco Holdings

Premier Oil

Repsol

RWE Dea AG

Shell

Statoil

Total

Tullow Oil

WEG

Wintershall

Europe


ARPEL

IBP

Pan American

Petrobras

PLUSPETROL

South America


Sasol Sonangol

Africa


JSOC Bashneft NCOC

Russia & Caspian region


APPEA

BHPBilliton

Cairn India

CNOOC

INPEX

Origin Energy

Papuan Oil Search

Petronas

PTTEP

Woodside

Asia & Australia


ADNOC

CC Energy

Development

Dolphin Energy

Dragon Oil

Kuwait Oil

Qatar Petroleum

RasGas

Yemen LNG

Middle East


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Who we are

IOGP’s Members produce over a third of world oil and gas.

IOGP works on behalf of the world’s oil and gas companies and organizations to promote

safety, efficiency and reliability

of oil and gas exploration and production operations

The Association defends industry Licence to Operate

Members are the heart and soul of IOGP’s work

• Member-based committees strategise, decide, contribute

• The secretariat proposes, coordinates, executes

Management Committee

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Guidelines for implementing Well Operations Crew Resource Management training

• Prepares training providers to deliver programmes that introduce and sustain well operations crew resource management (WOCRM).

• Sets learning objectives

• Includes guidance on training delivery, assessment and qualifications and knowledge of instructors and facilitators

Collection of Data series

Occupational

safety: Fatalities and fatal

accident rate

Health

management: Self-assessment rated

on a scale of 0-4

Process

safety

events: Tiers 1 & 2

Provides narratives of

the process safety

events and of process

safety-related events

where there are

significant learnings

Environment: 1.Gaseous emissions

2.Energy consumption

3.Flaring

4.Aqueous discharges

5.Non-aqueous drilling

fluids retained on cuttings

discharged to sea

6.Spills of oil and

chemicals

4 major annual reports

International Regulators Forum (IRF) conference

• To collectively identify and

oversee well control

improvement initiatives

(with IADC)

• To increase information

sharing between the

industry and regulators

• Focus on joint industry

project (JIP) addressing

blowout preventer (BOP)

reliability and technology

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• The key challenge for operators, suppliers and regulators.

Safety and Environment protection,

but activity must be profitable.

• Today, the industry delivers around 55% of the EU energy mix. Will remain around 40% in 2040

• Challenge: Maintaining competitiveness in Europe when production comes increasingly from other producing regions of the world Domestic production is key for security of supply and competitive energy markets

Europe oil and gas industry

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Europe oil and gas industry

• Basic : One-size-fits-all approach not adapted to our

industry Introduction of OSPAR Background document on BAT for produced

water:

“it cannot be concluded that a method, which has been operated

successfully at one installation, may achieve the same results at

another location“

(North Sea / Mediterranean / Onshore = different worlds)

• Industry clearly likes “ the Goal setting regime” . It allows the flexibility to select the most appropriate solution

Regulators (and industry) operate according to the key principle

of ALARP

• Post Macondo discussions between EU Commission

and Industry -- Offshore Safety Directive

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Offshore Safety directive (1)

•When granting licenses, EU countries must ensure that companies are well financed and have the necessary technical expertise

•Before exploration or production begins, companies must prepare a Major Hazard Report for their offshore installation. This report must contain a risk assessment and an emergency response plan

•Companies must keep resources at hand in order to put them into operation when necessary

•Technical solutions which are critical for the safety of operators’ installations must be independently verified. This must be done prior to the installation going into operation

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Offshore Safety directive (2)

•Competent National authorities must verify safety provisions, environmental protection measures, and the emergency preparedness of rigs and platforms. All incidents significant incidents must be reported

•If companies do not respect the minimum standards, EU countries can impose sanctions, including halting production

•Information on how companies and EU countries keep installations safe must be made available for citizens

•Companies will be fully liable for environmental damages caused to protected marine species and natural habitats.

For damage to marine habitats, the geographical zone will cover all EU marine waters including exclusive economic zones and continental shelves.

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OSD is not prescriptive, however industry has developed Standards and Guidance

Laws

regulation

guidelines,

notices

international standards

regional standards

national standards

industry standards

best or recommended practices

guidelines

group specifications

company specifications

(project specifications)

National legislative regime;

EU level regulation;

international treaties

Standards developing

organisations

Trade associations

Companies

Regulatory authorities,

enforcing authorities

i.e. ISO, IEC

i.e. CEN (Europe)

i.e. ANSI/API (US),

DIN (Germany),

NEN (NL)

IOGP, IADC, IMCA,

NOGEPA, NOROG, Oil &

Gas UK, etc

multinationals

independents/business

units

manufacturers/EPC

contractors

Best or recommended practices: last survey 8 172 referenced standards

coming from 180 different organizations

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Safety 1. Offshore Safety Directive 2. Major-accident Hazards Directive (Seveso II)

Workforce 3. Council Directive 89/391/EEC on the introduction of

measures to encourage improvements in the safety and health of workers at work

4. Outdoor equipment Directive 5. Working Time Directive

Security of Supply and energy market 6. Directive on the conditions for granting and using

authorizations for the prospection, exploration and production of hydrocarbons

7. European Energy Security Strategy 8. Security of Gas Supply Regulation 9. Common rules for the internal market in natural gas 10. Wholesale energy market integrity and transparency

(REMIT) Regulation 11. Markets in Financial Instruments Directive (MIFID)

Environment 12. Environmental Impact Assessment (EIA) 13. Access to environmental information 14. Strategical Impact Assessment (SEA) 15. Environmental Liability Directive (ELD) 16. Habitats Directive 17. Bird Directive 18. Marine Planning Framework Directive 19. Maritime Spatial Planning 20. Biocidal products regulations

Air Quality 21. Directive on the limitation of emissions of certain pollutants

into the air from Large Combustion Plants (LCP) 22. Medium Combustion Plant Directive (MCP) 23. National Emissions Ceilings Directive (NEC) 24. Industrial Emissions Directive (IED) 25. Integrated Pollution Preventive and Control (IPCC)

Climate

26. Directive 2009/30/EC on the specification of petrol, diesel and gas-oil and introducing a mechanism to monitor and reduce greenhouse gas emissions GHG emissions (FQD)

27. Directive 2015/652 on calculation methods (including UERs) 28. Regulation on a mechanism for monitoring and reporting

greenhouse gas emissions and for reporting other information at national and Union level relevant to climate change

29. Directive on Geological storage of carbon dioxide (CCS) 30. Energy Efficiency Directive

Ground, Chemicals and Products 31. Shale gas Recommendations 32. Substance Mixture and Packaging Directive 33. Mining Waste Directive 34. Waste Framework Directive 35. Water Framework Directive 36. Groundwater Directive 37. REACH 38. Biocidal Products

Upstream oil & gas activities are already comprehensively regulated at EU level

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1) We want to continue to develop globally accepted technical standards – preferably no BATs - for the oil and gas industry that:

• are mutually applicable worldwide and developed through collaborative and transparent processes;

• enhances technical integrity, improves safety, reduces environment risk;

• creates a worldwide level playing field (enables supply or movement of equipment and materials across borders)

2) We want to develop competencies able to understand and manage risks with efficient processes

What is industry aiming for today?

• Of course we have a procedure!

• Safety Case describes how we identify and manage risks

• “Most” companies do this via their SMS

So what does it all mean in practice?

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Safety case in practice

• Safety case describes the hazard ID process and the risk management tools (HAZOP, HAZID, MAR, QRA, etc.) used to ID and rank risk

• For each installation, they then identify the SCE, processes and procedures that eliminate or manage these risks (the barriers in the bow ties)

• The barriers all have performance standards they have to conform to

• The SC then describes which activities maintain these barriers

• These activities are mapped to the various regulations so that we can demonstrate which activity manages which barrier or piece of prescriptive regulation and how the performance standards are maintained

• These activities therefore become the prescriptive regulation that the operator follows

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Maintaining Safety Case

• Changes are managed through an MoC process that includes a system to check if the change will affect Safety Case

• All Safety Cases are reviewed at a high level every 2.5 years (or rather MoC’s are reviewed as a further check) and in depth every 5 years

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Safety Case in practice cont.

• The SC actually describes the company’s SMS

BP Asset UK Operational Safety Cases typically comprise three volumes as follows:

• Volume 1 Section 1 – Executive Summary

• Volume 1 Section 2 – Description of Health, Safety and Environmental Management System

• Volume 2 – Installation Description

• Volume 3 – Installation Hazard Management (including Justification for (Continuing) Operation)

Description of Health, Safety and Environment Management System The North Sea Region (UK) Health, Safety and Environment Management System is the same for all Installations. Standardised text has been prepared for this section; refer to Addendum 3.

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Safety Case in practice

• The HSE MS is, in BP speak, our OMS OMS Framework and the Integral Arrangements for Health and Safety Management The framework for OMS and the integral arrangements for health and safety management are built around the International Standards Organisation (ISO) principles. The framework comprises three key components which together provide a roadmap to safe and reliable operations: • The elements of operating, which inform • The Performance Improvement Cycle (PIC), which applies to • The local business processes, which deliver the elements of operating

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The Elements of Operating The elements of operating comprise eight areas, which are the basic elements that BP has identified need to be focused on at any point in time, to achieve safe and reliable operations. The eight elements are: • Leadership • Organisation • Risk • Procedures • Assets • Optimisation • Privilege to Operate • Results

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• The OMS is Global – based on Exxon’s OIMS management system - and applicable across the entire BP Group

• Going back to the third part of the OMS “The local business processes, which deliver the elements of operating”

• These may vary depending on the country of operation but always deliver the requirements of the 8 OMS elements of operating as well as whatever local regulation there may be

• These are described in the “How we operate in …..” • In over 90% of cases the OMS exceeds the local

regulations, the remaining 10% is generally documentation, reporting processes, frequencies etc.

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• Specifically – in Angola any spill over 1bbl has to be reported to Sonangol (PSA partner) and MinPet within 7 days regardless of where it is spilled from and to (primary, secondary containment etc.) and any spill to sea reported within 6 hours regardless of size.

• In all Regions there is a process to manage and track these differences (CTM)

• There is no effective national emergency response (coastguard, medical etc.) so industry has its own mutual aid process (ACEPA)

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Audit, Assurance and Self Verification

• BP operates a “three lines of defence” model • Audit is “Group Audit” an independent audit body

that reports directly to the BP Board (not the CEO!)

• Assurance is “Safety and Operational Risk” both “deployed” to the Regions and “Central” and report into the “S&OR EVP” – both these bodies are 2nd Parties

• Self Verification is the line checking itself that it is following its own procedures

• Third party auditors are also used (where required) but they never find as much as the 2nd party!

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Why we like “Goal Based”

• Example – “noise shall be below 83dB(A) or restrictions shall apply”

• A member used “smart” ear defenders to determine that many areas which had previously been measured at more than 83 dB(A) had many areas that were in fact below 83 dB(A) and successfully changed their safety case to allow workers in these areas 24/7 if needed.

• BUT when risk changes, industry or technology changes, so does the barrier/performance standard/risk management process, so does the Safety Case

• MUCH quicker than regulations!

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For more information please contact:

www.iogp.org

Registered Office

Level 5

209-215 Blackfriars Rd

London SE1 8NL

United Kingdom

T +44 (0)20 3763 9700

F +44 (0)20 3763 9701

[email protected]

Brussels Office

Bd du Souverain,165

4th Floor

B-1160 Brussels

Belgium

T +32 (0)2 566 9150

F +32 (0)2 566 9159

Chris Hawkes

[email protected]

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