Royal Dutch Shell Plc  .com Rotating Header Image

UpstreamOnline: Frontrunner in the safety race (*a devastating indictment of Shell management)

EXTRACTS: It would seem that Shell is now unwilling to give straight answers to many fundamental North Sea safety questions raised by Campbell and Upstream, such as how many emergency shutdown valves across its North Sea operations are still not operating as they should.

At Upstream we will certainly be looking for Shell to follow BP’s example in developing some of the long-overdue willpower, behaviour and actions to address the safety concerns of offshore workers who for too long have been at the sharp end of misplaced management decisions leaving them exposed to high levels of risk.

THE ARTICLE

By Upstream staff

Both Shell and BP have endured a string of high-profile problems in recent months, but the UK supermajor appears to be coming up with far more answers than its Anglo-Dutch rival.

A starkly contrasting approach to dealing with critical oil and gas safety issues has developed over the past week between Shell, which is under intense scrutiny over its North Sea safety record, and BP, which has pledged to spend an extra $1 billion on sweeping reforms of its US safety regime with global implications for all its businesses.

BP chief executive John Browne and his team have been under mounting pressure from US regulators over a series of incidents during the past 18 months, including last year’s Texas City refinery blast, a recent oil spill in Alaska and an investigation into its propane trading activities in the US.

Browne has, in typical fashion, led from the front, admitting to past mistakes and apologising for them while instigating a radical shake-up of its US subsidiary, BP America.

He has also appointed a new chairman, Bob Malone, to monitor its US business operations with a focus on compliance, safety and regulatory affairs.

Of course the jury is very much out as to whether Browne’s reforms will work, but at least the group has come up with a series of initiatives and rapid action plans that give it a better chance of achieving safety success.

BP’s new plan is in sharp contrast to the lacklustre performance on safety of Shell’s chief executive Jeroen van der Veer during his second-quarter briefings.

It would seem that parts of Shell may still be in denial that they even have a problem, despite startling disclosures over safety breaches on its UK flagship Brent field made by former Shell International group auditor Bill Campbell exclusively published in Upstream on 16 June.

Shell has declined to answer any further Upstream questions on Campbell’s claims and simply points this newspaper and the rest of the Press towards its letter published in Upstream on 23 June.

Instead, Van der Veer seems to take solace in pointing out that the oil business in general has a good, or even very good, safety record when compared to many other industries.

It would seem that Shell is now unwilling to give straight answers to many fundamental North Sea safety questions raised by Campbell and Upstream, such as how many emergency shutdown valves across its North Sea operations are still not operating as they should.

Nor have we received answers to such underlying questions as what action has been taken against senior Shell Expro management who were in charge of the Brent field during the troubled years 1999 to 2003, when Campbell’s evidence clearly showed how safety was being compromised in the interests of production.

Is it still the view of Van der Veer as expressed during a meeting with Campbell on 25 July 2005 that none of Shell’s current directors can be blamed for the Brent field safety problems?

If they cannot, then just who was responsible for the fields being run with dangerously high levels of risk?

Campbell alleges in a letter sent to Van der Veer on 25 July that all 15 of its North Sea installations covered in Shell’s 2003 technical integrity review were found to have deteriorated to such an extent they now require $1 billion of expenditure, as the risks on all are not as low as reasonably practicable and probably unacceptable to society.

Sadly, as Campbell has highlighted, the UK Health&Safety Executive’s Offshore Division is too weak in its application of the current Safety Case regime in the UK North Sea, including a failure of the offshore verification scheme.

In an e-mailed message to all staff, sent on 17 July, Van der Veer admitted to Shell’s second-rate safety performance.

“Our safety performance has reached a plateau and remains below best-in-class in our industry. Our statistics show it. We know it. Are we not trying hard enough, focusing hard enough, or haven’t we accepted that we have a problem? I think it is a mixture. All these aspects are probably part and parcel of the safety problem,” he suggested.

Van der Veer said that, although a $1 billion improvement programme is under way in its North Sea operations, the debate in the media is likely to continue about whether the company has done enough to ensure the technical integrity, safety standards and safety behaviour in that area of operations.

At Upstream we will certainly be looking for Shell to follow BP’s example in developing some of the long-overdue willpower, behaviour and actions to address the safety concerns of offshore workers who for too long have been at the sharp end of misplaced management decisions leaving them exposed to high levels of risk.

*”a devastating indictment of Shell management” headline comment added by ShellNews.net

THE LETTER FROM SHELL Vice president communications, Bjorn Edlund: 23 June 2006

Allegations overlook progress with safety

By Upstream staff

Upstream is continuing to make serious allegations about Shell’s operation of the Brent field in the late 1990s and to make some very personal, and we believe unjustified, attacks on current and former members of Shell’s staff and management.

As indicated in our published responses to your articles, we cannot accept the statements you have made.

We have consistently emphasised the importance of safety in our operations offshore.

The 1999 Platform Safety Management Review (PSMR) which you describe was commissioned by Shell to establish what further improvements were required to enhance North Sea safety performance.

Improvement areas were found and a detailed action plan was developed and implemented, with full senior management involvement and support, following the PSMR.

A follow-up audit commissioned by Shell a year later confirmed that progress was being made against the PSMR findings.

In December 2004, Mr Campbell approached Shell with concerns about the follow-up to the PSMR audit.

Shell took these concerns very seriously and, in response, initiated a detailed investigation, under the auspices of the group legal director and headed by Shell’s chief internal auditor.

This investigation concluded that Mr Campbell’s concerns had been addressed and the outcome of the investigation was shared with him.

Our chief executive, Jeroen van der Veer, also met Mr Campbell on conclusion of the investigation in mid-2005.

We deeply regret the deaths of Sean McCue and Keith Moncrieff on 11 September 2003.

The events of that day clearly are tragic and should not have occurred.

We are determined to ensure that such a tragedy does not happen again and have investigated its causes in great detail to try to prevent any recurrence.

We are committed to achieving continuous improvement in our safety performance.

Part of this commitment includes a $1 billion integrity upgrade programme and learning programmes which extend deep into our organisation.

We fully accept that there is still much we need to do to achieve the safety performance we seek.

There are many upstream stakeholders with an interest in offshore safety offshore staff and their families, unions, regulators and operators.

We all have a common goal to prevent tragic accidents. We want to achieve this goal in the shortest timeframe possible and we will continue to focus our efforts and resources in pursuit of this critically important objective.

Bjorn Edlund

Vice president communications

Shell

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

0 Comments on “UpstreamOnline: Frontrunner in the safety race (*a devastating indictment of Shell management)”

Leave a Comment

%d bloggers like this: