UK's HSE criticizes North Sea energy structure

Nov. 26, 2007
More than half of the oil and gas industry's basic assets in the UK North Sea are in poor condition, warned the UK Health and Safety Executive in a report.

Uchenna Izundu
International Editor

LONDON, Nov. 26 -- More than half of the oil and gas industry's basic assets in the UK North Sea that have been inspected over the past 3 years are in poor condition, and companies will face closure or prosecution if they do not improve safety standards, warned the UK Health and Safety Executive (HSE) in a report.

After inspecting almost 100 oil and gas platforms, HSE said various safety-related incidents had occurred because of the poor upkeep of basic structures, and that some maintenance backlogs were "unacceptable."

In the KP3 report, which investigated the safety and integrity of offshore installations and their equipment, HSE noted that the sector had made some improvements in its safety record but stressed that "more must be done."

Health and Safety Commission Chair, Judith Hackitt said: "In the light of the findings from the KP3 report, asset integrity will continue to be one of the main priorities for HSE's offshore division in 2008 and for the foreseeable future, but it must also be clear that it is for the industry itself to show leadership and face up to its responsibility." No companies were named in the report, but she said HSE would "name and shame" if necessary.

The criticisms followed comments by trade unions, which argued that some operators jeopardize their workforce's safety. Royal Dutch Shell PLC has been given several HSE "improvement notices" in recent years, and it has suffered strong criticism from its staff about safety. However, Shell stressed that safety is a priority in its operations.

Ian Whewell, Head of HSE's offshore division, recommended that companies coordinate activities across the board to prevent safety incidents. "The report identified that significant improvements in the sector could be achieved without major capital expenditure but through better planning, improved training, and clear statements of performance standards in testing and maintenance routines," said Whewell.

Oil and Gas UK, which represents the industry, welcomed the report, saying it would work closer with HSE to ensure that good practices are learned. The industry has spent £3 billion on asset integrity. Malcolm Webb, chief executive of Oil and Gas UK said the publication of the KP3 report "will help us sharpen our industry's focus on those areas that require greater attention and help steer our on-going industry initiatives."

But David Smith, vice-president of the energy sat Celerant Consulting, an operational advisory firm, warned that unless asset integrity was viewed as key to profitability, it would be difficult to see any significant improvements in the industry's safety record.

"Assets that demonstrate high levels of integrity are more productive, and more consistently productive, over time," he said. According to Celerant, many companies collect too much or inappropriate data, which prevents senior and middle management from truly understanding their operational picture.

Earlier this year at Offshore Europe, Whewell accused many companies of being dismissive of their safety representatives on offshore platforms as an unnecessary regulatory burden.

Contact Uchenna Izundu at [email protected].