By Kevin Kinsella and Rob Steer
The cost of clean-up in relation to the Deepwater Horizon incident is undoubtedly bringing about a shift in thinking around offshore risk management. While keeping people safe and reducing the risk of accidents remains a priority for our clients, we are seeing a more proactive approach to environmental risk assessment and emergency response issues, notably in relation to the aftermath of a serious incident and the speed of response and remedial solutions available.
The move towards an integrated approach to offshore safety is affecting our clients – operators and contractors – in different parts of the world, from the North Sea and other European waters, where operators must comply with the requirements of the European Union’s new Offshore Safety Directive, to the broadening of Safety Case culture to include environment in different parts of South East Asia – whether required by law or not.
Safety and environmental integration
As the Deepwater Horizon trial continues, it is evident that spending on environmental clean-up and restoration will be a significant component of the $42bn set aside to date. It is a cost few operators could bear and, as such, makes it critical to focus rigorously on safety and environment at all stages of an asset’s life cycle.
In practice, we are seeing different applications of an integrated approach, depending on where our clients are operating. In Malaysia, for example, ERM’s clients are seeking to incorporate and, where feasible, integrate safety and environmental measures at key phases of development and change during a platform’s lifecycle. They are doing this for a number of reasons, including reputation, joint venture commitments and good financial risk management, but not because they are required to do so by law.
A risk-based approach to oil spill modelling
Whatever the regulatory regime, we are seeing a more sophisticated approach in areas such as environmental risk assessment and oil spill modelling. Operators are increasingly adopting a risk-based, rather than consequence- focused, approach in order to understand better potential oil spill scenarios and develop a more tailored set of responses, both in terms of prevention and mitigation.
In the North Sea and other European waters, around 1,000 offshore facilities will be affected by the new EU Offshore Safety Case Directive. ERM is already working with clients who want to ensure that relevant safety and environmental risk assessments and emergency response plans address the full spectrum of risks and are fit for purpose.
At the same time, our clients operating in the Gulf of Mexico are adjusting to changes in the required approach to a Safety and Environmental Management Systems (SEMS). In the case of SEMS, more workforce involvement has become a priority – whistle blowing, in extreme circumstances, has become a right.
From an environmental perspective, we find that hard evidence – a move away from the “We think…” approach – is becoming increasingly important. This makes it more likely that environmental specialists will be asked to contribute to a formal Safety Case – whether in the North Sea, the Mediterranean or Australian waters - and advise on the mechanisms for reducing the risk of a major oil spill – as well as dealing with its consequences. This approach will involve, for example, modelling the threat of an oil spill from different activities or parts of an installation, the potential size of spills, the sensitivity of receiving ecosystems and how spill containment and mitigation could be optimised should the worst happen.
Life cycle collaboration
Inevitably this shift towards a risk-based environmental contribution to the Safety Case places a greater emphasis on collaboration and, in the case of environmental elements, a greater reliance on scientific data to support more accurate and realistic findings. Safety, environmental and social teams must work closely together as they model, for example, the risk of different oil spill scenarios and the potential consequences for the environment, human life and the wider stakeholder community.
In ERM’s experience, a collaborative, risk-based approach should extend throughout the lifecycle of an installation. At the early design stage, it involves safety and environmental engineering specialists working together to examine priorities, gather evidence and put the right prevention and mitigation measures in place. This level of collaboration continues during operation and through any planned life extension and decommissioning where the risk profile can change dramatically.
For its part, environmental risk modelling is becoming increasingly more precise – providing quantitative evidence around the size, duration, consequences and potential frequency of spills and how to avoid them. This can involve the use of specialist software to model the size and nature of spills with results presented to the authorities and other stakeholders as part of an integrated Safety Case. Integration remains very much on the agenda.
For further information on any of the issues raised in this article contact [email protected] or [email protected].