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IMechE Speech - 23 September 2014

Judith Hackitt CBE, HSE Chair

Good evening and thank you for inviting me to talk to deliver this annual talk organised by the Pressure Systems Group of IMech E. You have asked me to talk about Ageing Plant this evening. And I intend to do so. The title of my talk is “Ageing and Life Extension – facing up to the challenges, recognising the opportunities”. Much of what I talk about this evening will be based on the work of HSE’s Chemicals, Explosives and Major Hazards Division and our Energy Division. I will provide a brief description of some of the work programmes which are underway in these divisions, an insight into some of our findings and some observations on what this means in terms of challenges for industry.

I also plan to talk about the important roles which mechanical engineers play in HSE. They are central to much of the work of Chemicals, Explosives and Microbiological Hazards and Energy Divisions. I make no apology for using this presentation to highlight the interesting and challenging nature of the work which mechanical engineers undertake in HSE. If by any chance any of you find what I talk about to be stimulating then please talk to me later – we do have vacancies and we are recruiting – that is one of the “opportunities” I alluded to in the title of my talk!

But more broadly, I also want to talk about the important role of mechanical engineers in industry in managing ageing.  Both on and offshore, we are seeing a general shortage of good integrity management engineers in the industries we regulate.

For this part of my presentation - which will be much less about technical issues and much more about how we inspire and encourage new and recent graduates to come into the industry and work with us on addressing these challenges - I will draw on my own knowledge from IChemE and from some recent work I have been involved in with the Royal Academy of Engineering. One of the greatest challenges for us as engineers is to find much better ways of telling the story to others – to make what we do come alive and inspire others to follow. When Perkins and others tell us that there is a shortage of engineers in the UK, that isn’t just a problem for the future – but in the here and now. Whilst the main focus of this talk tonight is ultimately on preventing leakage from physical pipelines (and other vessels), we must also address the serious issue of leakage from the talent pipeline – but more of that later.

But let’s start with Plant Ageing and look first of all at how this fits in HSE within the work of the Chemicals, Explosives and Microbiological Hazards Division. Research carried out for HSE during 2008-2010 clearly identified ageing infrastructure and equipment as key contributors to incidents at onshore major hazards sites. As a result of these findings, the subject has become a strategic priority for the COMAH Competent Authority.

It goes without saying, I hope, that asset integrity management already formed a part of our intervention strategy at major hazard sites. So it was important for us to develop an approach which ensured that previous work on integrity management was not lost or ignored. However, we did need to ensure that it was integrated into the day-to-day work of the mechanical engineering team. Our revised approach began in 2010 with three clearly stated aims:

Over the four years that this strategic programme has been running we have identified some key issues but also made progress on addressing those issues.

The key finding which sticks out for me is that 70% of all sites we have looked at need to improve in at least one area of  ageing management.

Senior managers as well as engineers have a vital role to play in focusing  effort and resources into integrity management and ageing plant.

They need to:

So, to be clear, I am telling you that, from our current sample of over 400 sites which we have visited, 70% are failing to match up to at least one and in some cases more than one of these key principles.  Extrapolated for all of the 950 sites in GB that would mean around 650 are failing to match up.

One particular issue which we have identified is that onshore sites that use third parties to provide ageing plant management services (particularly plant inspections) are delivering significantly poorer performance when it comes to management of plant ageing.

Third party services are frequently contracted through a site’s insurance company or broker. This has long been standard practice in many places for the statutory inspection of air and steam generating pressure vessels as you will know only too well. Over time, this service has been extended to cover other aspects of inspection. Not a problem per se provided that the service provider is competent to do the extended work scope – which is not always the case. There are distinct differences, greater levels of expertise and access to more information required by those who are engaged to carry out detailed plant integrity inspections and go beyond what is required for inspection of generic equipment.

Failure to recognise the different competences required for integrity management are a frequent cause of inadequate arrangements being put in place. Integrity management inspectors must have access to and be able to interpret details of specific process conditions and environment for each item of plant in detail. Almost inevitably, such a service is going to cost more and may even require different third parties to be contacted to do the work. This means that the client must be an intelligent customer who can:

Simply ticking a box to say that an inspection has been done is by no means enough.

Much of what I have said here on what is required is now documented in guidance with the good practice guidance on managing integrity of high hazard plant published in conjunction with EEMUA and SAFEd. We are also currently working with the Chemical and Downstream Oil Industry Forum (CDOIF) to produce further guidance on making effective use of third parties.

Let me move on now to talk about the management of ageing plant in our Energy Division – predominately related to Offshore oil and gas facilities.

After 40+ years of oil and gas production and with >50 per cent of fixed platforms having exceeded their original design life, asset integrity is a major priority and will continue to be so. With the use of enhanced oil recovery, the potential for platforms to be pressed into different services and the continued reliance on oil and gas (in particular) as GB’s major source of energy, these facilities are all likely to remain in production for the foreseeable future.

This is not a new problem. But the offshore industry has certainly learned from experience the dangers of making assumptions about the likely life span of facilities. Low oil prices before the turn of the millennium led to assumptions that facilities would be quickly decommissioned and which some 15-20 years later are still operating. You as mechanical engineers will know that maintaining integrity of any asset is a different task from rebuilding integrity after it has been allowed to decline.

This raises an interesting aside about when you should start to think about management of plant ageing. Ageing is not simply about how old equipment is, it is about its condition and how that is changing over time. Ageing is a phenomenon that begins the moment equipment enters service and must be monitored and managed throughout the life of the facility.

From the day the plant is commissioned it will be subject to change and to challenge:

Even more so than with us humans, premature ageing of facilities needs to be avoided by taking care of the assets from day one!

But back to HSE’s work offshore.

Early in the new millennium, HSE’s Offshore Division (as it was known then) found substantial shortcomings in integrity management as a result of cost cutting and maintenance backlogs. The net result of this was an associated increase in the number of significant hydrocarbon releases. Our response to this concern was to undertake a programme of work (Key Programme 3) on asset integrity in the period 2004-2007, in particular looking at the risk of failure of safety Critical Elements associated with structure, plant, equipment and systems.

As you will be aware, the KP3 report revealed significant issues on the maintenance of safety critical systems on offshore installations. The report was made public and the findings were acknowledged by industry. KP3 has raised serious issues and in 2008, the then secretary of State for Work and Pensions commissioned a further review. That review found that industry had allocated considerable resource and effort to improve offshore assets and compliance with relevant standards, and a good start had been made on “catching up”.

But this was never going to be a short-term fix. The considerable effort which had gone into catching up had to be maintained and sustained. With this in mind, HSE launched KP4 on Ageing and Life Extension in 2010. KP4 has been looking at how dutyholders are planning to deal with asset integrity management in offshore process plant and structures for the long term. It has comprised targeted inspections of major hazard plant to assess the conditions by sampling and a review of the technical and management measures which are in place.

KP4 has just completed and makes a number of important recommendations to industry:

KP4 has also identified some further recommendations for us to follow up on in HSE:

As with the onshore industry, trade bodies, in this case Oil and Gas UK are continuing their work on developing ALE guidelines for industry across a range of subjects. HSE ED are participating members of the steering group. It is also worthy of note that this  issue is also now very much live within our sister organisation – the Office for Nuclear Regulation who have commenced an ALE project using some of the KP4  findings to develop their own programme.

If there is anything surprising in all of this, it is that we have to keep reminding people that  this is not just about doing this because we, the regulator see the need. Good long-term safety management, dealing with the potential for failure before the failure occurs is about improving business reliability and profitability.  We strongly believe that there is a much greater role for Reliability Engineers to be involved in ALE work. In fact the challenge is to get everyone in the business to see that asset management and preservation is fundamental to business success not something to be done for good old “elf n safety”! This gets to the heart of the issue. If the motivation for doing the right thing on asset integrity, ageing and life extension is because the regulator is “forcing the pace”, that motivation is wrong. Businesses need to see and believe that maintaining and protecting assets is part of running the business, performance is measured in terms of reliability and production levels – managing and running old assets is a challenge but it ought to be a truly motivating one.

All industrial infrastructure is continually ageing and it is simply not possible for all engineers to be employed in running shiny new kit. In my 30+ years in industry – I never once ran a brand new plant – I commissioned changes and improvements to some parts, yes, but I always worked on plants that were at least 20 years old and often more than that. I don’t think things have changed very much in that respect – there continues to be pressure on everywhere to keep plant running for as long as possible – and why not? It is a tribute to the quality of our predecessor engineers – and indeed some of us here in this room who designed and built these high quality facilities which have the capability to run well beyond their design life.

It is rarely the design capabilities of the plant which are found wanting, but the care and attention that has been given to the facilities during its operating life that creates the challenges in ageing and life extension. Managers and finance directors who use simple measures of performance to drive down operating costs   and who compare costs across all plants regardless of age place pressure on engineers who may know, for example, that there is a real need to tackle corrosion under insulation on older facilities. This short sighted approach leads to much higher costs in the long term – even if there is no leak or loss of containment – as the problem will be much more costly to fix the longer it is left – literally – under wraps.

In many parts of industry this has been exacerbated by a shortage of in-house skills to carry out the work and some of the added risks that come with outsourcing to third parties – such as access to and retention of inspection records – let alone my earlier comments about the adequacy/ appropriateness of third party inspection regimes.

One can add to this list changes in asset ownership which further challenge an organisation’s ability to maintain good records of inspections, refer to original design calculations and drawings and which may lead to major changes in management philosophy.

I mentioned earlier that all engineers cannot reasonably expect to be working with shiny new kit, but that is different from acknowledging that a lot will be attracted to do so in other parts of the world where investment levels are several orders of magnitude higher than here in the UK and salary packages are also very tempting. Even here in the UK we can see the salary gaps which exist between onshore chemicals and petrochemicals roles compared with similar roles offshore. Living and working offshore will not be attractive to everyone but the packages on offer to attract people in times of shortage are significant.

This is indeed an issue for us in HSE.

We need to employ competent chartered engineers who are confident and able to challenge their peers in industry to ensure that regulatory requirements are being met.

I often speak about the strengths and benefits of our goal setting regulatory regime, but we must not forget what such a regime demands of our inspectors. This is not about checking for compliance but expecting people to use their professional judgment and being prepared to have that judgment challenged by  both dutyholders and ultimately in the courts. They must take personal responsibility for the regulatory decisions they make and the advice that they give. It is part of their role to probe dutyholders’ systems and explanations and seek out weaknesses where they exist, to advise on how to improve and to take enforcement action where this is necessary.

Our front line inspectors are supported by deep topic specialists in both Bootle and in our Health and Safety Laboratory in Buxton. We have experts in metallurgy, stress analysis, fracture mechanics, ergonomics and forensic investigation. As well as providing that expertise to support the work of our frontline inspectors our experts are also called on to provide sound engineering advice to  HSE Senior management on policy making and to other government departments, sometimes on issues of national importance. To give you a feel for this, some of the current topics on our list include:

For those of you who work in industry, your role in ageing management is also very important and is far from being just about  the technical aspects. Your role is about:

I promised at the start of this presentation that I would talk about the opportunities as well as the challenges. So where are the opportunities in all of this?

For you as mechanical engineers already working in industry the opportunity is to raise your own profile and increase the recognition of the value you bring to the organisation – asset integrity and ageing management is becoming recognised as important issues by many senior boards – they know that they need your help – you have the opportunity to become part of the solution not the problem person who is always pointing out what could go wrong.

Your professional institution needs to support you in putting the key messages together not only for your current membership but also for students and would-be engineers of the future. It is clear to me that young people today are looking more seriously at careers in industry – via either the university route or a revived interest in apprenticeships. But it is also well recognised that there are still simply not enough people studying engineering to meet the current and future needs of industry.

Despite the need for more engineers being widely publicised, we are still not seeing the sort of increase in applications to study engineering that we need. There are, of course, some exceptions to that. In my own discipline of Chemical Engineering, over the last decade or so we have seen the number of people applying for and being accepted onto Chemical Engineering courses more than double. As I speak today, every chemical engineering course in the country is full, with several other universities in the process of establishing Chem Eng courses to meet demand. It is particularly encouraging to see the increase in the proportion of women applicants.

A significant part of the success in attracting more applicants to chemical engineering has been IChemE’s Whynotchemeng campaign. It came about in response to a crisis when the number of applicants dropped to an all time low around the turn of the millennium. The institution recognised the need to make the subject more appealing by doing a much better job of explaining what chemical engineers actually do and describing the wide variety of career opportunities for graduates. The change of language and approach has worked. IChemE’s next challenge is to apply similar principles to encouraging graduates to stay in engineering post graduation – there are still far too many engineering graduates who go straight into non-engineering jobs straight out of university and to all intents and purposes are lost to the profession forever.  This is the issue of leakage from the talent pipeline which I referred to earlier. There is a lesson here which we all need to heed and act upon.

There are skills shortages wherever we look throughout the engineering profession. We need to talk differently about what we do and what we all get out of the jobs we do. I have said many times that engineers are great at talking to one another – we have a common language – but we are pretty rubbish at talking to others and explaining what we do. I am very conscious of the fact that this talk I have given here tonight is very much aimed at an audience of engineers. If I were to give this talk to a different audience, how would I explain the subject matter?

I would probably start by talking about our essential role in saving lives, protecting the environment and preventing catastrophic incidents. I would talk about our long heritage of some of the best engineering in the world which has contributed to the quality of life and benefits which we all take for granted. I would talk about the economic and social importance of us continuing to operate the fine facilities we have in place which provide us all with energy, fuel, clean water, health care and consumer products. I would speak with pride about being an engineer in the hope of inspiring others to follow a similar path.

We don’t do nearly enough of that. We often complain that we as engineers are not valued – but it’s partly our own fault because we don’t do a good job of explaining our role and our value to the world. Professional institutions like this one are great places for bringing like-minded people together and there is of course a value in doing that – for the individuals and for the profession as a whole. But there is also a great opportunity which we all need to seize if we are to meet the many challenges out there in the world of engineering. Explaining what we do – using a different non technical language - to our bosses, to our stakeholders, to future engineers – will help to ensure that we have the resources we need for the future. Many of those ageing plants we have been talking about tonight will continue to operate long after we have all retired – we need to hand down our knowledge and those assets to future generations.

Thank you for listening.

Updated 2014-11-21