The Guardian: Cost-cutting 'jeopardises North Sea rigs'

By Kirsty Scott

Monday April 26, 2004

Union hits at oil and gas industries over under-reporting of offshore accidents

Fears are growing that safety is being compromised in Britain's North Sea oil and gas industry, and there are claims that corners are being cut to reduce costs.

Workers and a leading analyst have told the Guardian that maintenance is left to pile up on ageing platforms, and the level of accidents is routinely under-reported. Morale is said to be so low that workers are too disillusioned or scared to speak out about their concerns.

"It is a matter of luck as opposed to good management that we have not had a major incident since Piper Alpha," said Jake Molloy of the offshore workers union, the OILC. "All of the elements are there, other than a spark, really."

There are inherent risks in offshore work but the North Sea industry is seeing more deaths and more serious injuries than it did a decade ago, and in a drastically reduced workforce. Last September, two oil workers died in a gas escape on Shell's Brent Bravo platform. The deaths, which are still being investigated, launched a crackdown on safety.

But three weeks after operations re-started on Brent Bravo, there was another gas alarm. On December 3, workers were mustered to their emergency stations by the general platform alarm after oil leaked from a cooler. Shell said the incident, which it reported to the Health and Safety Executive (HSE), was minor with no threat to personnel nor to the platform. The OILC says it is disturbing, coming so soon after the fatalities. Their concerns have been compounded by a third incident this month when 60 people were evacuated from Shell's Cormorant Alpha platform after a leak in an oil line in one of the rig's legs. Shell said there was no significant build-up of gas and an investigation is underway.

Britain's oil boom is long past, and the industry, which made sweeping technical and safety changes after 167 oil workers died on Piper Alpha in 1998, is facing growing commercial pressures.

Only half of the North Sea's reserves have been tapped; but what is left is considered trickier and more expensive to extract. The amount produced is starting to tail off and the oil giants are looking to places like Angola, Nigeria and Russia for new profits,

The HSE says it has become "increasingly concerned" at the extent of maintenance backlogs, especially given the age of many of the platforms. "This matter has been the subject of enforcement action over the last two years and HSE has recently launched a drive to highlight this issue and the associated issue of installation integrity," said an HSE spokesman.

One offshore worker with almost 20 years of experience, said maintenance was routinely delayed. "I would report something that is not working, say, a leaky seal, to a technician and they will put a notification on it which will go to a team leader," said the man, who spoke on the condition of anonymity. "You are supposed to raise a job card which will be classed as safety critical, production critical, etc. What they will do is leave it as a notification. If it needs a shutdown to do the job, they would rather leave it until the next shutdown. They have paid all the maintenance supervisors off. People complain and when they see that the work is not being done they stop complaining."

Disrepair 

Mr Molloy said many of the rigs were "literally falling apart." He added: "Some of them are over 30 years old. The original design use was for 15 to 20 years. They are trying to cuts costs on old installations (which are) falling into disrepair; plant and equipment is failing on a regular basis, systems are becoming old, valves are passing. They are pushing maintenance right to the very limit. We have all these elements we had in the run-up to Piper [Alpha]."

The industry's main trade organisation, the UK Offshore Operators Association, said there were commercial pressures on the industry, but there was an absolute commitment and responsibility not to compromise safety. UKOOA said safety issues were constantly monitored through government and industry initiatives and the target was for the North Sea to become the safest offshore sector in the world by 2010. Hydrocarbon releases on platforms, meanwhile, had been reduced by almost half in the last three years.

"There is no wholesale cutting back on safety," said a UKOOA spokesman. "There is a huge safety industry working in the North Sea that far exceeds anything that's taking place in any other industry and, I would say, in any other oil and gas sector worldwide."

Shell, meanwhile, said the Brent Bravo fatalities were not the result of cost cutting and that safety is never compromised. A decade ago, the offshore industry employed some 34,000 people. Today, the figure stands at 22,000.

"It is no different from any other industry where the move over the last few years is always to get rid of people and try and operate on fewer," said Colin MacFarlane, professor of subsea engineering at Glasgow and Strathclyde Universities, and himself an offshore contractor.

"The offshore staff are already stripped down. There is a very strong feeling that there are unseen hazards. You cannot quantify it, but we believe they are going up because the numbers employed in maintenance, the numbers involved in operations have been dramatically reduced and when you are talking about maintenance, that is scary. There is a stage where maintenance falls where nothing can be done to make things better. It may be that companies believe their increased focus on safety management is countering this, but recent incidents suggest not."

Incidents

Latest HSE statistics show that there was a 36% increase in major injuries last year. There have been three fatalities since the reporting period ended in March 2003. The number of less serious injuries fell from 187 to 118 and the number of dangerous occurrences dropped from 652 to 636.

Taf Powell, head of HSE's offshore division said the statistics showed a mixed picture but efforts were continuing to improve safety and performance.

The HSE has said it considers the level of under-reporting of incidents offshore to be limited, something that is disputed by the OILC and the workers the Guardian spoke to.

One employee of a large oil firm said he resigned as a safety rep in the mid-1990s over the issue of accident under-report ing. "There were a lot of accidents at the time," said the man, who spoke on the condition of anonymity. "I was going to every safety meeting to make people more safety aware. I would read the safety statistics and it was a joke. If people had broken arms or broken fingers they had them in the office licking stamps rather than send them off the platform."

Another worker, again speaking on the condition of anonymity, explained why many workers avoided reporting minor accidents. "If anything happens there is that much bureaucracy that people avoid reporting things in order to avoid a muddle," he said. There are also fears that if they make a fuss they will "not be required back," known as NRB in the industry.

"There are two cultures offshore," says Colin MacFarlane. "One is a company culture that tries to arrange the accident report so it minimises the impact. The culture of the guys offshore is to keep your head down; don't rock the boat."

That gap between employers and workers is widening across the board, according to the OILC, something the industry can ill afford if it is to avoid another disaster. "There is no trust left," said Mr Molloy. "And trust and respect are fundamental."

http://www.guardian.co.uk/business/story/0,3604,1203319,00.html