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Another North Sea disaster

So let’s deregulate and make a dash for abandonment at minimum cost and hope we get lucky seems to be the game.  And also let’s put the Chairman of the North Sea’s worst offending Company in charge of the process. Hopefully sense will prevail before the next almost inevitable major accident event when one of the 85 gas leaks per year coincides with a source of ignition.

COMMENT SENT BY BILL CAMPBELL TO ROWENA MASON ON HER RECENT TELEGRAPH ARTICLE: Former Shell chairman James Smith to lead deregulation of UK oil and gas industry

Rowena – interesting article

With some 50 serious injuries a year (up by 20) and over 400 reported dangerous occurrences 85 of which were losses of containment of hydrocarbons into the atmosphere (1) it seems an inappropriate time to reduce regulation. Apart from the recent oil spill on Gannet where Shell accept a causal factor may have been lack of maintenance and inspection, with the HSE stating publicly that lack of maintenance offshore could have severe consequences generally across the oilfield, it seems that better and more proactive oversight of this industry is needed rather than less.

(1) Based on public domain data from HSE for year 2009/10, this year figs not yet available, dangerous occurrence is by Government definition under the relevant legislation.

With 50 % of offshore installations well past their original design life (normally 25 years) with some by as much as 20 years,  failure is endemic due to ageing, what we call age related failure.  The failure mechanisms effect all aspects of the installation where carbon steel is used from the primary structure to pipe, grating, floors, decks et al the list goes on.  The corrosion grows and spreads, perniciously like a cancer, through the whole rig, in what is a relatively warm but highly saline atmosphere causing the surface corrosion of metal allied in pipelines with internal erosion caused by reservoir sands carried to the surface by the flow of oil and gas.

Assets which go beyond their design life need more expenditure on maintenance, not less.  And, beyond the design life, sometimes called operating or useful life, the risks of continued operation increase with time.

Just at the time when costs are rising revenue is in sharp decline as the reservoirs deplete.  Deregulation can be motivated I suspect as a cost saving initiative

All the circumstances we need to exist for the most common cause of major accidents worldwide that is bad behaviour driven by conflict of interest. In this case the conflict between cost of increased maintenance, inspection and monitoring and loss of revenue to support these costs without going into the red.

So let’s deregulate and make a dash for abandonment at minimum cost and hope we get lucky seems to be the game.  And also let’s put the Chairman of the North Sea’s worst offending Company in charge of the process. ( Freedom of Information data shows Shell is the industry leader in gas leaks by a good measure).  It for example had Brent Charlie shut down in January with the HSE concerned about potential catastrophic risks if it continued to operate.  So Mr Smith’s appointment!  He is probably a nice man but Fox in charge of the hen house comes to mind.

Hopefully sense will prevail before the next almost inevitable major accident event when one of the 85 gas leaks per year coincides with a source of ignition.

regards

Bill Campbell

PS: I have contributed input to your paper before, also Guardian and Times, Channel 4, STV, BBC etc

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