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July 14, 2009

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Asset integrity remains a challenge for offshore industry

The oil and gas sector has made good progress to improve the condition

of plant, and address the issues raised in a damning 2007 report from

the HSE on asset integrity — but more work is needed to maintain this

momentum.

The three-year KP3 inspection programme of offshore installations, which concluded in 2007, found that in more than half of the sites inspected, the physical state of the plant was ‘poor’. Senior managers were criticised for not giving sufficient priority to maintenance, and backlogs for ‘non-routine’ maintenance work of 26,000 hours were discovered.

The follow-up assessment of the industry’s progress since the KP3 report, published on 14 July, found that the industry has allocated considerable resource and effort to improve offshore assets and compliance with relevant standards. All the original ‘red traffic lights’ (issues of serious concern) identified in the original KP3 review have been satisfactorily addressed, while good progress is also noted in general plant maintenance.

However, the latest report also highlights residual concerns about asset integrity and its management, and warns that the changing economic environment must not be allowed to slow progress in this area.

It states: “There is increasing involvement of smaller specialised operators, who are structured to maximise benefits from ageing assets and challenging reservoirs. Such changes, which often involve new maintenance management software, can seriously impact on asset integrity, disrupting the flow of information, such as key performance indicators, to senior managers.”

Ian Whewell, head of the HSE’s Offshore Division, warned: “Momentum must continue to prevent the assets degrading to the unacceptable levels identified in the 2007 KP3 report.

“Because of the changing nature of ownership within the UK Continental Shelf, it is also essential that maintenance histories are secured and legacy information on asset integrity is passed to new operators. The benefits of good safety are unchanged, even in the current downturn.”

This message was echoed by HSE chair, Judith Hackitt, who said: “The economic climate does pose a real challenge, but we have been here before. Learning from past mistakes means not squeezing key resources at the very time ageing installations and infrastructure need investment.

“HSE made clear at its recent strategy launch that the recession must not become an excuse for cutting back on health and safety in any sector. Nowhere is this more true than in offshore operations, where there can be no excuse for another Piper Alpha disaster.”

The report also welcomes the progress made in areas that could have a positive impact on offshore safety culture, and makes special mention of the publication of guidance on ‘not required back’ policies and enhancing leadership knowledge. Major-hazard risk control and the role of installation integrity are now better understood by the workforce. However, the extent to which workforce involvement and elected safety representatives are effective in securing improvements is generally not measured, or assessed by companies.

Commenting on the review’s findings, Malcolm Webb, chief executive of Oil and Gas UK, said: “This thorough HSE review very clearly shows the immense progress the industry has made since the beginning of the KP3 programme in 2004 — in particular, in the areas of asset integrity, leadership, and workforce engagement.”

Gordon Ballard, co-chair of Step Change in Safety — the industry body set up in 1997 to improve safety offshore — and chair of Schlumberger UK, said: “The results of the KP3 review very clearly show that industry has improved its communication with the workforce.”

He continued: “However, the review also points out that there is room for improvement, particularly in enhancing the role and performance of safety representatives. Their role is sometimes found to be unclear and patchy, and the report indicates that they have not been effectively consulted on installation safety cases. We will make sure that, through the Step Change in Safety workforce engagement work group, any shortcomings in this area are being addressed.”

A copy of the KP3 review is available on the HSE website at http://www.hse.gov.uk/offshore/kp3review.pdf

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