Dutch FT: Retired Shell chief safety officer warns of major Prelude risks

In brief

*The number of accidents per man-hour worked has risen again for the first time in a long time last year.

*A series of incidents, criminal investigations and warnings from regulators are damaging Shell’s safety image.

*Shell CEO Van Beurden himself is also not satisfied and wants to do more to guarantee safety.

Printed below is an English translation of an article published today by the Dutch Financial Times, Financieele Dagblad.

Beeld: Getty Images/ bewerking: FD Studio

Shells gas leaks, fires and accidents

Bert van Dijk: 13 March 2019

Last year the number of accidents per hour worked increased at the oil company. Supervisors warn that Shell needs to do more about safety.

In December 2017, during regular maintenance work, a lifeboat suddenly came loose on the Shell platform Brent Alpha in the North Sea. The lifeboat fell into the sea and was recovered a day later. Although no one is injured, it was not the first time. In 2008, it was discovered that two lifeboats on another nearby Shell platform, Brent Bravo, were technically in such poor condition that they had to be replaced. And in 2007 a rescue boat on another Shell platform broke loose and collapsed into the sea.

The incidents with the lifeboats in the North Sea are not isolated. Shell has been blamed 28 times since 2014 by the British regulator due to, among other things, inadequate safety measures and lack of maintenance. This is evident from data from the Health and Safety Executive (HSE), the British employee safety supervisor, which the FD has investigated.

Brent Bravo

This often involves gas leaks. For example, after a gas leak on the Brent Bravo production platform, HSE Shell decreed in 2017 to take measures to prevent gas leaks from occurring again in the future. “Shell has not prevented the release of uncontrolled flammable or explosive substances,” said the regulator in a report on the incident.
A gas leak also occurred on the same platform in 2014.

In May 2017, at the behest of the regulator, production on a nearby platform – Brent Charlie – had to be stopped after a gas leak causing a risk of explosion. In June of that year two more warnings followed for overdue maintenance of pipelines on the platform.

In a letter to all oil and gas companies with operations in the North Sea, the British regulator HSE warned in 2018 of insecurity. “There have been a number of those leaks in recent years that have come dangerously close to disaster,” said Chris Flint, director of HSE’s energy division, to British media.

Maintenance neglected

An insider in the oil and gas industry recognizes the problems. ‘The oil and gas platforms in the British part of the North Sea, in particular, are outdated. Not just at Shell, “says this expert. “There, in the years following the low oil prices, there has been a tendency to neglect maintenance, for example by cutting back on paints, which can lead to corrosion.”

Monika Hausenblas, responsible within Shell for the worldwide safety of installations and employees, says that the same strict safety requirements also apply to older platforms. ‘Maintenance is crucial. We do not save on that, but it is sometimes a dilemma for managers with a maintenance budget. If something still works well, you may be able to postpone maintenance for a while. That is of course not what we want. That is why we pay a lot of attention to it and we discuss these dilemmas. ”

Shell not only has to deal with safety problems in the North Sea. In recent years, for example, the company has had several fires at a large refinery in Singapore, a fire at an oil platform in the Gulf of Mexico, major earthquake damage in Groningen, a fire at Pernis in Rotterdam and an explosion at a chemical plant in Moerdijk 2014. Shell was recently summoned by the Public Prosecution Service for the latter. A criminal investigation is ongoing into the fire in Pernis.

Hausenblas emphasizes that Shell is only satisfied when there are no more victims. “When I started at Shell 27 years ago, we had about seventy fatal accidents every year. Last year we had two. That is a huge improvement, but as long as it is not zero, we are not satisfied. That is why we want to learn from every incident. Also from the near-accidents. We investigate the dilemmas of employees and are very concerned about risk standardization. That means that you try to prevent yourself from being aware of risks, because something has been going well for a long time. ”

In the middle bracket

It is difficult to assess whether safety is worse or better with Shell than with industry peers. Nearly 90,000 employees worldwide work with explosive substances in hazardous places, such as oil platforms and refineries. Then the risks are considerably greater than in other industries.

That is why safety and the procedures for guaranteeing these are central. This has been implemented into the capillaries of the company. From mandatory safety instruction films and courses to the compulsory holding of the handrail and parking backwards.

The insider in the oil and gas sector says that safety is a top priority for Shell. Nevertheless, according to this insider, Shell is at the center of the industry in terms of safety.

“BP, known for being the biggest oil spill in history in 2010, has long been seen in the industry as the black sheep in terms of safety and ExxonMobil has the best reputation despite the disaster with the Exxon Valdez,” said the oil and gas expert.

Fatal accident in Pakistan

The tens of billions of damages that BP suffered as a result of the Deepwater Horizon platform disaster in the Gulf of Mexico show that safety is crucial, also for a healthy future for a company. That is why safety scores partly determine the level of the remuneration of top managers.

This direct link became painfully clear to the top of Shell last year when the influential voting advice firm ISS advised shareholders to vote against the remuneration of the Shell board due to a major accident with more than 200 deaths at a Shell subcontractor in Pakistan. An unusually high percentage of 25% of the shareholders followed the advice of ISS and voted against the remuneration policy.

“Lax safety procedures”

Bill Campbell, chief safety officer at Shell at the start of this century and now retired, frequently warned Shell about lax safety procedures. In 1999, for example, he published a damning internal report on the safety procedures at Shell on the Brent Bravo platform, in which he warned of deaths if no measures were taken.

Four years later, two employees were killed on that platform, which, according to Campbell, would not have happened if Shell had listened to its warnings, complied with safety regulations, and carried out better maintenance. Police investigations also showed that the accident could and should have been prevented. Shell was fined.

Risks Prelude

Campbell now warns of the major risks at Prelude, Shell’s gigantic 450-meter floating gas plant off the coast of Australia. “Prelude is a technical feat and a revolutionary concept, absolutely, but don’t underestimate the risks,” he tells the FD. Campbell said he was involved in the project at Shell in Rijswijk in the past.

Prelude is a complex gas factory compressed on an area of 3 hectares. Such a factory on land would be 20 times as large. At Prelude, several hundred people work on top of an explosive, where on-land workers are said to be located much further away from the core activity. It is almost inevitable that gasses will ever escape and the consequences can be enormous. ”

Between May and October 2018 alone, Shell reported 17 security incidents with Prelude, Australian media reported. “We are happy with the reports in the test phase,” says Hausenblas. ‘You want that just before you start production. We have talked extensively with all authorities about safety and we have all permits. We will only produce if we are sure that it is safe. ”

SOURCE

Declaration by John Donovan.

I was pleased to put the Dutch FT in contact with Mr Campbell and supply copious information from my extensive files about Shell’s shocking safety record stretching back decades, which continues despite repeated claims by Shell that it puts worker safety before production. Shell’s past “Touch Fuck All” culture on the Brent Bravo platform exposed by Mr Campbell proves otherwise.

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