Two in three rigs fail on safety… but guilty oil giants stay secret

THE North Sea oil industry was yesterday accused of forgetting the lessons of the Piper Alpha disaster - 19 years after the world's worst offshore catastrophe cost 167 oilmen their lives.

A damning report, published by the government's offshore safety watchdog, has revealed a catalogue of serious safety failings and a backlog of safety-critical maintenance work on offshore production installations.

A three-year investigation found nearly two-thirds of the 100 platforms and mobile rigs inspected were either in a poor state of repair or guilty of non-compliance with safety regulations.

Inspectors from the offshore safety division of the Health and Safety Executive (HSE) discovered backlog levels on rigs as long as 26,000 hours. On one installation, there was a backlog of 15,000 hours of work that was deemed "safety-critical".

Half of the "deluge systems" on offshore platforms - vital in fighting fires - had red or amber "traffic lights" assigned by the HSE. In many cases, this was due to the corrosion of carbon-steel pipework.

Health and safety failings lay at the heart of the Piper Alpha disaster.

The HSE also came under fire yesterday for failing to identify which companies had breached crucial regulations or give detailed examples of the breaches. It also refused to tell The Scotsman how much the publicly funded investigation cost.

Jake Molloy, of the OILC union, said: "I am disappointed and frustrated that the report does not identify the individuals or companies who have been badly performing. If we are going to bring about real change, we need to provide transparency and openness."

Graeme Tran, regional spokesman for the Amicus union, said he believed no lessons in safety had been learned since the Piper Alpha tragedy in 1988. He said the companies who were the worst offenders should be named and shamed, and the government should strip them of their offshore licences.

"It is absolutely frightening when you see the figures," Mr Tran said. "It is an unacceptable position to have in the North Sea. There are companies still risking the lives of our members for the price of a barrel of oil."

Judith Hackitt, who chairs the Health and Safety Commission, the body responsible for health and safety regulation in the UK, said the report should act as wake-up call to the industry to get its house in order.

The HSE has already taken enforcement action against a number of oil companies to address the safety- critical maintenance failures that were uncovered. At least one platform was shut down on the orders of HSE inspectors because of a massive safety-critical maintenance backlog.

Ms Hackitt pledged "stronger and more formal enforcement action" should the industry fail to heed the warning. Asked why the HSE would not "name and shame" the worst offenders, she said: "If we were to single out some people and name and shame them as the worst performers, I would ask you to think about those that then get let off the hook in terms of assuming that they're OK.

"What we want to do today is to make the message very clear to them all that this is a problem that is shared by the industry as whole. They are all only as good as their weakest link. It is a collective responsibility."

The HSE report is based on an inspection of 100 of the estimated 250 installations and mobile platforms working in the North Sea. It reveals that in more than 50 per cent of the platforms inspected, the state of the plant was "poor". A total of 16 per cent of the platforms surveyed were found to have non-compliance or major failings, while a further 42 per cent had isolated failures or incomplete systems.

The report states: "Companies often justified the situation with the claim that the plant, fabric and safety systems were non-safety-critical and a lower level of integrity justified.

"This claim disguises a poor understanding across the industry of potential interaction of degraded non-safety-critical plant and utility systems with safety-critical elements in the event of major accident."

Ian Whewell, head of HSE's offshore division, said there was a danger that the lessons learned from the Piper Alpha disaster had been forgotten.

He said: "I think the risk is that, as time passes by, the corporate memory fades. We have almost a new generation moving into the North Sea now. There are people who have never experienced a catastrophic incident."

Mr Whewell added: "I think there is a risk that productivity and production does take precedence over safety."

Ms Hackitt said part of the maintenance problem was due to a "legacy of under-investment" dating to the 1990s when the price of the barrel was at a record low.

She said: "Important maintenance work is often seen as the poor relation of new construction and increased production projects, but maintaining the basic integrity of the asset is vital to both safety and production."

The industry body Oil and Gas UK said the report highlighted the need for more work to be done, despite recent investment in maintenance.

Malcolm Webb, its chief executive, said:

"Over the last three years, the industry has spent more than £3 billion in the area of asset maintenance and we have done much to highlight and shift the focus to process-safety and asset- integrity management. However, the report highlights that there is work still to be done and that in some areas we are not yet where we need to be.

"This industry definitely has not forgotten the lessons of Piper Alpha."

From offices to N-plants - watchdog's massive brief

THE HSE

THE Health and Safety Executive's mission is to protect workers by "ensuring risks in the changing workplace are properly controlled".

Established in the mid-1970s, the body covers nuclear installations, mines, factories, farms, hospitals and schools, offshore gas and oil installations, the safety of the gas grid, the movement of dangerous goods and substances, and many other aspects of the protection both of workers and the public.

Using the Health and Safety at Work Act of 1974 as its guide, it is headed by Geoffrey Podger, the chief executive.

The agency has been controversially accused by some quarters of contributing to a generation of mollycoddled children with no notion of taking risks, creating a climate of fear by trying to abolish the concept of "acts of God" and ramping up the cost of maintaining old buildings.

The HSE employs 1,500 inspectors whose task is to prevent serious accidents in the workplace.

The HSE describes the oil and gas industry as "dynamic and rapidly changing".

However, officials note that an ageing infrastructure and increasing cost pressures as the available oil and gas declines along with the inherent risks of working offshore "require high standards of management of health and safety".

Among its stated goals is to support the industry to be the "world's safest offshore sector by 2010".

The HSE is funded by the Department of Work and Pensions.

How major companies fell foul of North Sea regulators

THE CASES
THE issue of safety in the North Sea has never been far from the headlines.

There were union concerns in April 2005, when Shell was fined a record £900,000 for safety failings on its Brent Bravo platform, which led to the deaths of two oil workers.

Earlier this year, it emerged that an improvement notice had been served on BP, ordering the company to carry out a full audit to prove it was complying with health and safety regulations, after concerns were raised on the Schiehallion floating production and storage vessel in the Atlantic frontier.

Six improvement notices were served last October on Amoco UK, whose parent company is now BP.

In May, the public was told safety inspectors had served 51 improvement notices and nine prohibition notices on various platforms and companies in the northern sector of the North Sea.

Unions have also said that the primary concerns are focussed on maintenance and corrosion.

• Professor Alex Kemp, the leading oil economist and analyst at Aberdeen University, said that poor maintenance and shutdowns were not only costly but also bad publicity for the industry.

But he added that there was a culture of safety inspections among companies now entering the industry.

"Some of the newer players in the North Sea, when they took over mature fields, increased their number of inspections as a device to give warnings of the possibility of unplanned shutdowns as result of maintenance issues," he said.

"It also makes good business for maintenance to be treated as a priority these days because with these extraordinary high prices, to maximise your production at the moment is clearly good business. If there are unplanned shutdowns or maintenance problems, then you are losing an awful lot of money."

FRANK URQUHART