APPEA2010 Industry Update

Libby Hood

Senior Policy Adviser – Skills & Safety

Presentation Outline

APPEA 2010 Safety Performance Data (Q1&Q2)

APPEA High Potential Incident data

APPEA HSO Committee Strategic Priorities – the safety agenda in 2011

Update regarding the industry’s work in response to Montara and Macondo

Questions

2

Safety Performance Data

Table 1: Number of injuries experienced

by employees and contractors

Employees Frequency Contractors Frequency

2010

ADI 11 0.88 43 1.60

LTI 4 0.32 26 0.97

MTI 15 1.19 85 3.16

2009

ADI 7 0.32 98 2.02

LTI 18 0.82 76 1.40

MTI 23 1.04 209 4.30

Location of Incidents

Location of incidents 2010Q1-2010Q2

0 5 10 15 20 25 30 35 40 45

Hands/fingers

Hips/legs

Back

Eye

Shoulders/arms

Feet/toes

Face

Multiple locations

Head

Trunk

General/unspecified

Internal organs

Ear

Neck

2010Q2 2010Q1

www.appea.com.au

Incidents by Operation

0 5 10 15 20 25 30 35 40 45 50

Production

Construction

Maintenance

Ancillary Support

Development Drilling

Workover

Planned Shut-in

People Transport

Loading

Appraisal Drilling

Other Survey

Purging

Exploration Drilling

Other Transport

Pipeline Transport

Processing

Commissioning

Geophysical Survey

Decommissioning

Storage

2010Q2 2010Q1 2009Q4

Activity Type Examples

OFFSHORE FIELD OPERATIONS

Production and processing • Off-shore processing and production activities

• Oil, condensate and gas extraction and separation

• Primary oil and gas processing, water and liquids separation, CO2 removal

• LNG processing • Fractionation, compression, storage, • All fixed production & process platforms,

FPSO, • Maintenance testing, repairs and servicing –

plant and pipelines Logistics • Shore Base

• Supply Vessels • Transport (Ship, Helicopter) - People &

Materials Drilling • Offshore drilling and petroleum engineering

– down hole activities • Exploration, appraisal, development and

workover • Mobile Offshore Drilling Unit (MODU) • Survey work required for drill rig location

(environmental, metrological, oceanographic) Seismic and exploration • Seismic and other geophysical activities

(gravimetric, magnetic) Development projects and construction

• New projects, construction, fabrication, new pipelines, plants, hook up and commissioning

• Survey work required for platform location (environmental, metrological, oceanographic)

Summary Data – by sector

TRI – Total Recordable Injuries

LTI – Lost Time Injuries

TRIFR – Total Recordable Injury Frequency Rate

LTIFR – Lost Time Injury Frequency Rate

Total TRIFR by Nature of Operations- Offshore Field Operations

0.00

5.00

10.00

15.00

Year Qtr

Num

ber

Production & Processing Logistics Drilling Seismic & Exploration Development Projects

Production & Processing 8.00 10.00

Logistics 11.00 6.00

Drilling 2.00 3.00

Seismic & Exploration 0.00 0.00

Development Projects 13.00 10.00

2010 Q1 2010 Q2

High Potential Incident DataMechanism of Injury

Contact with electricity (14%) was the most frequently reported mechanism of injury for personnel HiPOs.

Activity

Maintenance (43%) was identified as the primary activity being conducted when the HiPOs occurred

Cause

Procedural failures (46%) and dropped objects (21%) were identified as the primary causes of the HiPOs reported to APPEA.

APPEA HSO CommitteeStrategic Planning Session

Agreed criteria for future APPEA projects

Direct ‘line of sight’ to key business risks and threats

Direct and clear link to improved safety performance

Whole of industry relevance (onshore and offshore)

Within the sphere of influence of APPEA

Intended to increase capability to respond to and influence the policies, programmes and settings adopted by governments and regulators

Strategic Priorities

Process Safety/Asset Integrity

Emergency Management

Competence

Contractor Engagement

Sharing Lessons and Good Practice

New Projects

Hydrocarbon Releases

Fatigue Management

Managing Aging Assets

Data Capture, Analysis & Sharing on Process Safety

* These are new projects for which there has been no Board endorsement or budget/resourcing decisions.

Implementation Platform

Industry Response to

Montara & Macondo

Industry Response to Montara/GoM – Focus Groups

16

APPEA BoardBroad Oversight

Montara/GoM TaskforceOversight and engagement with Federal Government

on Montara Report

Australian Drilling Steering Committee

(ADSC)(Operators and drilling

contractors)

Focus Team 1Contractor Relationship – Well

Operations ManagementBridging Template

Focus Team 2Mutual Aid Protocol – Technical

Response (Rigs & Equip)

Focus Team 3Technology & Innovation – Cap

& Containment Options

Emergency Management Steering

Committee(EMSC)

Focus Team 1 – Oil Spill Preparedness and Response (draft ToR) – tiered concept based on risk; scenario planning (map); template for plans; communication strategy; whole of industry desktop exercise in 2011

HSO Committee – Emergency Response/Search and Rescue Capacity – (personnel focus)(SAR/logistics/hospital capability/ performance standards)

Focus Team 1: Well Operations ManagementRequirements - Contractor/Title Holder Responsibilities

Focus Team 1 has developed a Self Audit Tool

The approach taken emphasises that:

The offshore safety case regime (and safety case revision) already operating in Australia is robust

The WOMP offers a well technical asset safety case

Good guidance material already exists

Focus Team 1: Well Operations ManagementRequirements - Contractor/Title Holder Responsibilities

The Self audit check list is assembled as a tool for use by participants in the Offshore drilling Industry within Australian Territorial waters. The intent is that this check list should be used by Title holder (licence/permit holder), and Facility Operator (drilling contractor), in the preparation and execution of well activities.

Focus Team 1: Well Operations ManagementRequirements - Contractor/Title Holder Responsibilities

The Self Audit Tool covers:

Risk Management:

Management of change

Barrier philosophy

SIMOPS on the rig itself

Operational Procedures and verification:

Responsibilities of title holder vs. drilling contractor

Competencies and verification

Command and support structures

The Self-Audit tool DOES NOT:

Address design standards

Describe cap & containment

Address field Simops

Cover broader life cycle of well assets (Brownfield)

Focus Team 2: Mutual AidFocus Group 2 has developed a first draft of a Memorandum of Understanding (MoU) based on long standing and well accepted North Sea Mutual Aid arrangements (OCES).

The MoU sets out:

Clear principles for Mutual Aid and Joint Declaration

A Framework for decision making to allow quick and transparent decision making around the provision of mutual aid

Definitions eg: of ’emergency situation’

Triggers for calls for assistance

Call out mechanisms and administrative arrangements

Agreed timeframe for assistance

Some arrangements for compensation for assistance

THE MoU DOES NOT COVER consequential losses or indemnities or similar legal arrangements.

Focus Team 3: Cap & Containment

Broad consensus across the Drilling Steering Committee that Australia should examine the desirability/suitability of cap & containment solution.

A 3rd Focus Team are looking at the application of technical solutions being developed by OGP, and will identify potential application in Australia.

SummaryAPPEA Safety Performance Data

Sector specific data now available

High Potential Incident Data

Leading Indicator

Current focus on contact with electricity; maintenance; procedural failures & dropped objects

APPEA 2011 Strategic Priorities

Asset Integrity/Process Safety; Emergency Management; Competency; Contractor Engagement; & Sharing Good Practice

Industry Response to Montara & Macondo

Self Audit Tool

Memorandum of Understanding (MoU)

Consideration of cap & contain options

For more informationLibby Hood

Senior Policy Adviser – Skills & Safety

08 9481 5225 or ehood@appea.com.au

Miranda Taylor

Director – Skills & Safety

08 9321 1311 or mjtaylor@appea.com.ai

** Particularly for queries regarding the industry response to Montara/Macondo

Thank you.