I am delighted to be addressing you today and to be here to congratulate those who will later be receiving awards. When Malcolm Webb invited me to the inaugural lecture of the UK Offshore Oil and Gas Industry’s first safety awards event, I accepted the invitation without hesitation.
Over the course of the last two-and-a-half years during which I have chaired HSE, I have not always heaped praise on the performance of your sector, but I do applaud the real efforts you are making to drive up safety standards in the offshore oil and gas industry.
For the health and safety record of the sector to be improved further, initiatives such as this have an important role to play. Celebrating and recognising achievement inspires and motivates others to follow good practice and learn from one another.
Yours is an industry that is renowned for its innovation and applying practical fixes to complex problems and this skill and expertise must be extended to all aspects of your work including overcoming the current as well as future health and safety challenges.
It would be an understatement to say that over the last few years the offshore oil and gas industry has gone through some challenging times. Structural changes among operators, some stark reminders of the importance of process safety and asset integrity, concerns about the extent to which workforces are engaged and dealing with the findings of HSE’s seminal publication: the Key Programme 3 report.
But to the industry’s credit, led by the UK Oil and Gas industry’s Step Change initiative, it has made significant progress in addressing such issues.
However, today, I want to remind you all that this is a task that never ends and one where complacency must never be allowed to creep in. The necessary level of focus and commitment to continue this important work and ensure that health and safety in offshore oil and gas industry continues to improve year on year, must be maintained.
To stress this point further and to illustrate why this is so important, I want to briefly look across to another sub-sector in the energy industry and to the comments made recently by the Chair of the US Chemical Safety Bureau, John Bresland, marking the 5th anniversary of the explosion at BP’s Texas City refinery.
He said: “When will we know whether the tragedy of 2005 has resulted in greater safety at BP and other companies’ refineries? Only when we can look back over the passing of a significant number of years without major accidents, deaths, or injuries. In the meantime, only the highest commitment to running down the even smallest of problems and upsets will assure the prevention of so-called low probability, high-consequence events like the tragedy that took so many lives in Texas City five years ago.”
The specifics may vary from one installation to another but from HSE’s perspective the key issues that this industry should be focusing on in order to maintain progress are linked to the overall strategy for health and safety in Great Britain.
Some of you may be aware that in April 2008 the Health and Safety Commission and Health and Safety Executive merged. The most tangible benefit of this merger was the publication of the new Strategy for Health and Safety in Great Britain in the 21st Century. This was important, not simply because the strategy reset the direction for health and safety in all sectors – including offshore – but because:
(So) relating that to offshore oil and gas, what are the main elements? Well obviously, the strategy’s key goals for avoiding catastrophe, the need for leadership, building competence and involving the workforce feature prominently. And consequently, these topics will underpin HSE’s Offshore Division’s on-going work which is being dominated by the continuing need to drive forward the KP3 agenda and in particular asset integrity.
Let us focus on asset integrity now. In spite of it being nearly 3 years since the original report was issued, why does the KP3 agenda remain so important? My view is that the findings of the original KP3 Report were very worrying because a mature industry with 20 years’ of experience under its belt in tackling offshore health and safety, was falling short of what was required in a number of areas. And these signs of weakness warned of the possibility of a systemic failure to manage safety effectively.
History wasn’t my favourite subject at school as my long and enjoyable career as a Chemical Engineer makes clear. But I do understand that history needs to be a fundamental part of every engineer and manager's training. Because when we forget the lessons of the past, history has a nasty habit of repeating itself. The KP3 report gave us an early warning that some of the lessons learned often the hard way, including those from Piper Alpha, may have been forgotten, or at least allowed to fade.
As well as matters pertaining to engineering standards, I was particularly concerned with the findings relating to leadership and learning.
And on learning:
In October 2007, when I made my first visit to Aberdeen as Chair of HSE to launch the KP3 report, I remember very clearly being asked at the time what it was that I wanted to see from the offshore industry. The answer was very simple - "Ownership and Leadership".
Last year I was really pleased to see that the KP3 Review undertaken by HSE found that the offshore industry’s leadership had responded well and allocated considerable resource to tackling the issues identified in the first report. I would like to thank everyone who has contributed to this improvement. The review found evidence of good progress in addressing the issues raised by the KP3 report. In particular, leadership in integrity management is now firmly on the industry’s agenda and has been effectively promoted throughout the offshore oil and gas sector.
But the challenges are on-going. The offshore infrastructure continues to get older and remedial work in some areas is yet to be completed. Strong leadership is still needed throughout to ensure that this momentum is maintained to continue the build up of improved asset integrity, not just to maintain the current status achieved or, even worse, to allow things to fall back to the unacceptable state we found when we conducted KP3.
For me, perhaps the greatest concern was that KP3 issues were only addressed after they were identified by HSE. The law is quite clear – and has been now for over 35 years – about who’s meant to be responsible: ‘those who create the risks’.
Industry needs to set the pace and lead for itself. That is why I view the decision by the sector to develop the Step Change Strategic Plan for 2010-2015, and the move to use the HSE strategy as a feeder for this, as a very positive step forward. Embedding a strong safety culture doesn’t happen overnight. It needs constant care and attention and it must be based upon clear goals and priorities. It also requires buy-in from everybody in the system so that they take ownership and work to achieve its aims. This requires strong commitment, determination and leadership.
These three characteristics are even more crucial given that we are already well beyond the expected design life of many facilities. We also know that there are new challenges ahead with consideration constantly being given to how the industry may evolve in the future.
The pursuit of new methods of energy generation that will cut carbon emissions into the atmosphere is gaining pace and will have an impact on us all. HSE is preparing for this. A Programme is already looking at the health and safety challenges associated with new and emerging energy technologies, many of which will have an offshore focus.
So we all face new challenges in adapting an existing offshore regulatory framework which is fit for purpose, but may need to be updated to accommodate the introduction of new activities and processes. All of this serves to underline the importance of ongoing commitment, determination and leadership – and sharing of knowledge and good practice.
The type of leadership we want to encourage offshore requires a culture where workers feel that they can legitimately express their concerns, and that their suggestions will be listened to, welcomed and acted upon. When they are involved in this way, a culture change happens and good practice and learning can be shared with others.
HSE has always been eager for an event such as today’s to take place. The recognition that awards bring is very important to health and safety because as we keep saying: health and safety is about creating a culture that is embedded within a company and its employees’ DNA so that the right things are done at the right time all of the time. I’ve been impressed but not surprised by the number and the quality of the nominations that the awards have attracted. I know there has to be a winner, but 90 nominations were received - that’s a lot of people using their ingenuity to create solutions or find ways to make their workplaces safer for everyone.
And that’s the crucial point. Assets are of course: plant, pipelines, service vessels etc, and if your business is to be successful and if incidents are to be minimised they have to be taken care of. But, the most important asset in any business, including this sector, is its people. Because people, can have good ideas, can show leadership and can inspire others to take the initiative and do similar things.
I am delighted to have had the opportunity to speak at this event today. I want to offer my personal congratulations to all of the entrants in these awards – especially the winners. I want to congratulate you all for leading the Step Change process and for setting up these awards. You are on a long journey of improvement in health and safety but it is right and proper that you celebrate success and share good practice along the way.
Congratulations to you all!