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March 19, 2015

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Is it an accident waiting to happen?

In June, Seveso III comes into force. However, as Brian Lait argues, the aspiration of a ‘level playing field’ of major hazard safety across the EU remains a pipe dream unless the European Commission creates a credible enforcement regime. He highlights a development in Cyprus that raises concerns over safety.

In SHP’s June 2014 issue, Terry Woolmer outlined the new EU Major Hazards Directive (also known as Seveso III), which comes into force on 1 June 2015 and applies to all EU member states.

Seveso III replaces the Seveso II Directive from 1996. These directives seek to create a ‘level playing field’ whereby all member states comply and deliver a high standard of protection for communities and the environment. In my opinion, however, some member states simply adopt it as ‘window dressing’ with little or no meaningful implementation.

Moreover, despite the high-minded principles of Seveso II and III and the obligations placed on various parties, the EU Commission has no supervisory, monitoring, audit or control function over how, or even whether, such directives are implemented in member states.

The ‘principle of subsidiarity’ is absolute and it is up to each member state to ensure its implementation, as Thomas Verheye, the head of unit at the European Commission Directorate-General, Environment, confirmed in a letter, dated 15 May 2014.

In it, he said: “The commission monitors the transposition and application of European legislation in general terms. The commission is not empowered to carry out detailed evaluations and inspections concerning individual sites covered by the directive. It remains the prerogative of the member states to define in accordance with the local situation the measures to be taken to comply with the directive.”

The EU Commission is content so long as a directive has been passed into national legislation and a competent authority is identified. In my opinion, this ‘light touch’ approach enables, if not encourages, irresponsible states to soft peddle. Many factors may influence implementation failure at state level, such as a laissez-faire culture, ignorance, an ‘it can never happen here’ attitude, a lack of resources, and pressure, if not corrupt influence, from vested interests. Site operators may also share some of these factors in addition to wanting to minimise cost and inconvenience of compliance and possibly achieve a risk trade-off i.e. ‘what can we get away with?’

In my opinion, the Vassilikos Energy Complex (VEC), which is under construction in Cyprus, is an example of where there is a gap between what Seveso II/III seeks to achieve in terms of protection and the reality on the ground.

Based on the Vassilikos master plan drawn up by a consultant acting for Noble Energy for the Cyprus government, the whole VEC will cover an area of some 25km2 and will include oil, LNG and LPG storage as well as potential production of ammonia, urea, methanol and other associated petro-chemical outputs. In addition, there are berths for up to four vessels at any one time.

The Dutch conglomerate Vitol, through a subsidiary VTTV, is a site operator. VEC, which became operational in December 2014, has 28 oil storage tanks with a capacity of 543,000 m3 (1.99 times the size of Buncefield in the UK which also had oil and gasoline storage) and the shipping facilities for the four vessels. The facility may be extended by a further 305,000 m3 making it three times larger than Buncefield.

In addition to the new facilities at VEC, there is the adjacent Vassilikos power station run by the Electricity Authority of Cyprus (EAC), which supplies around 60 per cent of the electricity. The power station was rebuilt following its destruction on 11 July 2011 when poorly stored explosives at the Mari naval base next door blew up, killing 13 people. The power station site was and remains a designated major hazard site under the Seveso directives and Cyprus regulation.

Although situated in a rural coastal area, VEC is flanked by a number of villages where property was damaged in the Mari-Vassilikos blast. The official government inquiry led by Polis Polyviou found that there were glaring deficiencies in the EAC’s compliance with Seveso II, including failure to address bi-directional domino effects (Seveso II, article 8) and defects in the statutory safety report (Seveso II, article 9) which materially affected the disaster outcome. Polyviou was scathing in his comments about management failures within EAC.

Following the Mari-Vassilikos disaster and then the announcement of the VEC master plan, a great deal of public discontent and cynicism has been expressed in the Cyprus media about whether the government had the capability or even intention of ensuring Seveso compliance. How could the public find out about the implementation of Seveso II/III and related matters, such as the fire services and the environmental study, in relation to VEC? Seveso III article 14 requires ‘upper tier’ sites (i.e. those with higher inventories of dangerous substances) to make available to the public details of the safety measures, a copy of the safety report on request and a major hazard inventory list. Moreover, article 15 requires operators to ensure public participation in decision-making to ensure accountability and transparency.

Despite these Seveso requirements and the Cyprus regulator’s enforcement obligations, VEC operators so far do not appear to have complied with articles 14 and 15.

It would appear that the government has relied solely on the advice of Noble or its consultants, who may well have carried out systematic identification and assessment of risks and their mitigation. However, I would ask – what independent assurance is publicly available that such assessments are competent and reflect actual conditions and not an idealised wish?

Perhaps an independent safety assessor (ISA) should also be appointed to evaluate and review its work and output so as to avoid conflicts of interest, to the possible detriment of safety. Possibly in conjunction with an ISA, the competent authority as a major hazard regulator should also evaluate the operator’s compliance and take any appropriate action.

Public trust and confidence are undermined by a toxic combination of a ‘what can we get away with?’ culture in some member states, non-implementation of EU Seveso Directives, a political and administrative rather than a safety assurance approach to implementation, and what I see as a laissez-faire EU Commission. The aspiration of a ‘level playing field’ of major hazard safety across the EU remains a pipe dream unless and until the European Commission creates a credible enforcement regime. Until then, I strongly believe that major accidents are waiting to happen.

Brian Lait is a chartered accountant who is committed to the safety of major hazard sites. He would like to thank Professor Alan Waring CFIOSH and Associate Professor George Boustras at European University Cyprus for reviewing this comment piece.

Brian Lait has written to Noble Energy, VTTV, the Cyprus Commissioner for the Environment and the Cyprus Minister for Energy and says that he has not received any meaningful responses, with Noble not responding at all. To contact the author to find out more about his investigation, email: [email protected]

The views expressed in this comment piece are those of the author and do not represent those of SHP.

 

References

EU (1996), Major Hazards Directive (the ‘Seveso II’ Directive) 96/82EC. Brussels: European Commission.

EU (2012), Control of Major-Accident Hazards Involving Dangerous Substances (the ‘Seveso III’ Directive) 2012/18/EC. Brussels: European Commission.

Newton (2008), The Buncefield Incident 11 December 2005, Final Report of the Buncefield Major Incident Investigation Board, chairman Lord Newton. London: Health & Safety Executive.

Polyviou, P. (2011), Report of the Inquiry into the Disaster on 11 July 2011 at the Naval Base ‘Evangelos Florakis’ at Mari, chairman Polis Polyviou. 30 September 2011. Nicosia: Government of Republic of Cyprus.

Waring, A.E. (2013), Corporate Risk and Governance. Farnham, Surrey: Gower Publishing.

Woolmer, T. (2014), Seveso III – This Time it’s Toxic. 46-47, Safety & Health Practitioner, June 2014

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Vince Butler
Vince Butler
7 years ago

Excellent article well researched an presented. Independant safety assessments (ISA) sound OK, however, unless the ISA really is completely and utterly independant, factual, objective and acts with utter integrity, it’s effectiveness is compromised. Private for profit consultancies, albeit maybe brilliant experts in their field can never really, really tell the “truth and nothing but the truth” to their clients behaving in the manner depicted in this article, if they did bring factual “bad news”, or maybe expensive solutions and controls, where would their next commission come from. Consultancies bringing bad news to clients tend to struggle somewhat in future. Today,… Read more »