Safety Failure in the Oil Industry Paying for the Piper

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Safety Failure in the Oil Industry- Paying for
the Piper

• Charles Woolfson
• Marie Curie Chair
• EuroFaculty
• University of Latvia

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My co-ordinates

• E mail woolfson_at_eurofaculty.lv
• Web http//www.eurofaculty.lv/MarieCurie
• Link Student Resources
• Password Student
• Login Info

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Industrial Disasters

• Accidents - rarely individual isolated
  unforeseeable events.
• They are more often the result of long term
  underlying patterns of (mis)behaviour.
• Management must carry primary ethical, legal and
  practical responsibility for safety and health of
  employees.
• Corporate Social Responsibility

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Why a movement to Corporate Social
Responsibility?

• Globalisation
• Greater transparency of corporate (mis)conduct
• Wider notion of accountability

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Corporate Social Responsibility (CSR)

• CSR promotes the idea that companies besides
  their economic concerns decide to take on board
  environmental and social ones.
• The occupational safety and health concerns for
  the workforce often play an important role
  amongst these.
• Hans-Horst Konkowlewsky, Director General of the
  European Agency for Safety and Health at Work

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Corporate Safety Failure The Piper Alpha
Disaster Causes and consequences

• Case Study

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The disaster

• July 6th 1988 Occidental Petroleums Piper Alpha
  platform exploded
• One of the largest original offshore oil
  platforms in the UK North Sea
• The worst industrial accident in the global
  offshore oil industry
• A turning point in safety in the global offshore
  oil industry from which important lessons were
  learned

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Immediate causes of the disaster

• Need to distinguish immediate and underlying
  causes of safety failure.
• Routine maintenance operation of pressure valve
  for a gas condensation module
• Poor management of Permit-to-work system
• Relief crew unaware of second permit indicating
  the non-replacement of the valve
• Second pump (pump B) trips out
• Night shift starts relief pump A unaware that
  there is only a metal flange seal but no valve.

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The sequence of events in the disaster

• Gas release from pump A finds a source of
  ignition
• The initial explosion resulted in a large crude
  oil fire engulfing the north end of the platform
  in dense black smoke.
• The fire was spread by oil leaking from the main
  oil pipeline to shore and from ruptured pipelines
  carrying oil and gas from the linked Claymore and
  Tartan platforms.
• Between 22.00 and 23.20 hours there were two
  further cataclysmic explosions caused by pipeline
  ruptures and, at this time, large sections of
  Piper Alphas topsides began to disintegrate and
  fall into the sea.

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• Despite the visible conflagration on Piper Alpha,
  the linked oil platforms continued to export oil
  and gas to Piper Alpha thus feeding the inferno,
  because, in the words of the official inquiry the
  responsible managers were reluctant to take
  responsibility for shutting down oil production.
• Survivor - The Piper did not burn us it was the
  other rigs that burnt us.

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• Platform emergency systems proved to be
  inadequate. The initial explosion knocked out
  the control room and disabled power supplies and
  communications. Survivors spoke of an eerie
  silence that descended on the platform, as the
  familiar background noise of generators and plant
  abruptly ceased.
• The fire-water deluge system had been out of
  commission for several months and was inoperable.
  Those that did operate, did so only with the
  remnants of water left in the system.

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• Most of the persons on board the installation
  were in the accommodation area, many in the
  cinema room. Others, who were on duty, made
  their way to the galley area in accordance with
  installation emergency procedures. However, the
  smoke and flames enveloping made evacuation by
  helicopter or lifeboat impossible.
• After some minutes, the lighting in the galley
  area failed and panic began to set in. Within
  another fifteen minutes, dense smoke began to
  penetrate the galley area. Men were forced to
  crawl along the floor to escape the smoke, using
  wet towels to assist in breathing. Others were
  quickly overcome.

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• some of the men decided individually, or as a
  group, to ignore the company advice to wait in
  the accommodation area for rescue. They realised
  that to remain on the platform was to face
  certain death.
• There was no systematic attempt to lead the men
  out. Those who survived did so because of their
  familiarity with the platform layout. The entire
  eighteen man catering crew, whose knowledge of
  the platform outside the accommodation area was
  minimal, died, as did the 81 personnel who
  remained in the accommodation area.

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• Of those who left the area, 28 survived. Among
  the total of 61 survivors, some had jumped into
  the sea from heights of 175 feet. Many of those
  who escaped were horribly burned on their hands
  and feet as the platform literally melted under
  them. For those who made it to the water their
  grim struggle for survival was by no means over.
  With the platform disintegrating above them, and
  the sea on fire around them, the only hope for
  survival was to be plucked from the water
  quickly.

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• Glen Shurtz, chairman of Occidental Petroleum
  (Caledonia) We have always practised the
  management of safety. Offshore its our number
  one priority.
• What happened on Piper Alpha, could have happened
  on any of the platforms in the UK offshore
  sector. Piper Alpha was a disaster that many had
  predicted and yet their warnings had not been
  heeded.

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Part 2

• Who was culpable?
• Regulatory reconstruction
• Safety reconstruction
• Industrial relations reconstruction

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Key points

• Interconnection between safety and industrial
  relations
• regulatory capture
• The contrasting onshore safety regime
• industry response corporate social
  responsibility?

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Regulatory Capture

• process whereby a regulatory agency comes to
  wholly identify the public good with the
  interests of the industry it is supposed to
  regulate
• relationship between the Department of Energy and
  the offshore oil industry - conflict between
  production (tax revenues) and safety
• Mineral Workings (MWA) Act 1971 only 6
  Inspectors for the entire UK offshore industry
• A highly prescriptive act but never properly
  enforced oil companies create a zone of
  exclusion offshore
• institutionalised tolerance of non-compliance
  (Carson)

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The contrasting onshore safety regime

• The Onshore Safety is a different regime - Robens
  Report (1972) Safety and Health at Work
• Safety regulation moves away from prescriptive
  rules towards a goal-setting regime
• implies the systematic assessment of risk in an
  overall sense and a shift from externally-policed
  regulation towards industry self-regulation

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Health and Safety at Work Act

• The Health and Safety at Work Act 1974 - a
  unifying body of enabling legislation - basic
  duties of employer to provide a safe working
  environment, and of the employee to observe
  health and safety provisions
• Even though the employer held the ultimate
  responsibility, health and safety was deemed to
  be the concern of all those who created risk
  namely 'everyone at work

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Health and Safety at Work Act

• A single unifying agency to govern safety and
  health at work separate from sponsoring
  ministries (HSC/E)
• The HASAWA 1974 was tied to the Labour Government
  agenda of corporatist industrial relations -
  consensualist and tripartite
• trade unions given exclusive powers to appoint
  safety representatives and safety committees

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Offshore Industrial Relations

• Few safety committees and little consultation
  with the workforce
• Industrial relations climate hostile to trade
  unionism US style management regime
• attempt to create union-free environment and
  consultative committees
• Intimidation and victimisation of employees,
  especially contractor workforce NRB blacklist
  troublemakers choppered off.

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After Piper Alpha The Cullen Report

• Public Inquiry under Lord Cullen QC
• Occidental Petroleum criticised for failure to
  operate a safe system of work despite previous
  incidents - lessons not learned
• Regulatory controls by D of En criticised -
  inspection of Piper Alpha in the weeks before the
  disaster was described as superficial to the
  point of being of little use as a test of safety

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The Cullen Report - D of En

• Department of Energy - overconservatism,
  insularity and a lack of ability to look at the
  regime and themselves in a critical way. Little
  had been learned from the more modern onshore
  approach to hazard characteristic of the HSWA or
  from the more forward-looking regime in Norway

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The Cullen Report - Occidental Petroleum

• Failed to operate an effective permit-to-work
  system
• Disregarded written procedures
• Provided inadequate and misleading safety
  induction materials
• Ignored previous concerns over the permit-to-work
  system
• Failed to learn the lessons from previous
  incidents (included a fatality and a
  near-disaster evacuation)

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• Lord Cullen -
• It appears to me that there were significant
  flaws in the quality of Occidentals management
  of safety which affected the circumstances of the
  event of the disaster . . . They (senior
  management) adopted a superficial response when
  issues of safety were raised by others . . .
  Platform personnel and management were not
  prepared for a major emergency as they should
  have been

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Workforce participation in safety

• Lord Cullen
• It is essential that the whole workforce is
  committed to and involved in safe operations. The
  first-line supervisors are a key link in
  achieving that, as each is personally responsible
  for ensuring that all employees, whether the
  companys own or contractors, are trained to and
  do work safely and that they not only know how to
  perform their jobs safely but are convinced that
  they have a responsibility to do so. Possibly the
  most visible instrument for the involvement of
  the workforce in safety is a safety committee
  system

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Regulatory Reconstruction

• D of En powers removed and given to HSE in a new
  Offshore Safety Division
• New concept of safety management proposed
• The Safety Case regime -the identification and
  assessment of hazards over the whole life cycle
  of a project through all its stages of
  development to final decommissioning and
  abandonment

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Problems with new Regime

• Oil company hostility and resistance to new
  regulation, especially any prescriptive
  requirements too costly
• Initial hostility to new regulatory authority
  under the HSE dont understand our industry
• Failure to address the outstanding issue of
  industrial relations offshore dont need
  unions
• New accommodation between regulator and target
  industry

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Positive elements of new regime

• Introduced modern safety thinking into the oil
  industry
• Elected Platform Safety representative system in
  place
• New sensitivity to issues of corporate reputation
  (safety and environmental issues)
• Greater degree of regulatory scrutiny
• No similar disaster to Piper Alpha, so far,
  although a number of near disasters

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Negative elements of the new regime

• No significant increase in safety performance
  measured by accident data
• Danger of a gradual erosion scenario
• Issue of workforce empowerment still to be fully
  addressed trade unions?
• Step Change Programme an inadequate response to
  failure to improve safety performance in line
  with goals

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(No Transcript)
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Accident Underreporting Revealing the hidden
transcript Voices from below

• My accident happened on the A installation and
  resulted in my having ... to wear a surgical
  collar. On the A (2 days later) the company
  phoned me up asking if I would come into the
  office when I was due to go offshore which I was
  due to ... (1 week later), and do some light
  duties. The company obviously tried to avoid a
  Lost Time Injury. I refused. A few days later X
  suggested to me about getting some letters and
  forms sent over to the house and to do some paper
  work with the help of my wife. Once again
  avoiding a Lost Time Injury.

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Corporate Social Responsibility?

• Even Occidental has its own social
  responsibility and health, safety and
  environment web pages claiming that health and
  safety has been its number one priority for the
  past twenty years. Occidentals web site makes
  no mention of the Piper Alpha disaster.

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Conclusions

• Need to recognise tensions between profits and
  safety
• Business will not always do the right thing
• Need for credible compliance incentives
• Empowerment of stakeholders (the workforce)
  must be real not token or supreficial
• Accidents - rarely individual isolated
  unforeseeable events.
• They are more often the result of long term
  underlying patterns of (mis)behaviour.
• Management must carry primary ethical, legal and
  practical responsibility for safety and health of
  employees.

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Marx

• Integrity and honesty are the foundations of
  success...If you can fake those, youve got it
  made.

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• ..Groucho Marx
• not Karl Marx