Safety Culture in the Upstream Oil and Gas Industry

September 2014#252657

● Invested $67 billion in Canada in 2012

● $18 billion to governments per annum (Royalties, Land Bonuses and Taxes)

● 20% of the value on Toronto Stock Exchange

● Approx. 18% of Canada’s exports

● Employs more than 550,000 in Canada

The Oil and Natural Gas Industry- A Key Driving Force in the Canadian Economy

Upstream Oil

& Gas

Auto

Manufacturing

Forestry

& LoggingWheat &

BarleyUranium

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Canada’s Energy Circumstance:

Resource-based export economy

The Global Energy Spotlight on Canada

World-Class Capability

Social License

-> Performance

-> Communication

World-Class

Resource

Competitiveness

-> Market Diversification

-> Workforce

3

Canadian Association of Petroleum Producers (CAPP)

● Represents Canadian oil & gas sector (~ 100 member companies)

● Members explore for, develop and produce natural gas, natural gas liquids, crude oil, and oil sands throughout Canada

● Members produce about 90 per cent of Canada’s natural gas and crude oil

● Key focus areas:� Education

� Communications & Outreach

� Policy & Regulatory Advocacy

� Industry Performance

● Key deliverables: � Competitiveness

� Social License

● Workforce skills & capacity is key to competitiveness

● Challenge arises from growth opportunity and demographics

● Provide opportunity for Canadians:

• Safety & Training

• Mobility

• Under-represented groups

● Immigration:• Numbers & skills

• Permanent and temporary

● Workforce supply and productivity is key to managing costs

Competitiveness - Skilled Workforce Availability

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As the safety association for the upstream oil and gas industry in British Columbia, Alberta and Saskatchewan, Enform:

� Helps companies improve their safety performance with proven practices and certification tools.

� Provides training, guidance and other support to help companies adopt and apply practices to improve safety performance.

� Gathers, analyzes, reports and uses industry safety performance data.

� Fosters and promotes a strong industry safety culture with timely and targeted communications and advocacy.

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CAPP’s Training and Qualifications Committee (TQC) is a multi-stakeholder committee that identifies and considers training and qualifications needs for the Atlantic Canada offshore petroleum industry (including reciprocity issues with other jurisdictions and quality of training)

� Includes representatives from Industry, Regulators, Training Providers and the Offshore Workforce

The TQC is responsible for reviewing and updating the Atlantic Canada Offshore Petroleum Industry Standard Practice for the Training and Qualifications of Personnel (TQSP).

CAPP’s Training and Qualifications Committee (TQC)

•7

Social License – Performance & Communications

● Performance:

• Continuous environmental & social performance improvement (across the value chain)…..including monitoring, timely & transparent reporting

• Clear line of sight to economic and social benefits to Canadians

• World class policy & regulatory system

• Solutions-oriented advocacy for balanced policy and regulation

● Communications & Outreach:

• Sustained communications grounded in performance improvement

• Strong focus on outreach & engagement

● Requires Leadership & Collaboration

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Reputation/ Social

LicensePerformance

Communication &

Outreach=+

Responsible Canadian Energy Program (RCE)

Represents a collective commitment by CAPP’s members to:

� Measure our performance (people, air, land and water)

� Find new and innovative approaches to reduce our environmental footprint

� Ensure every worker returns home safely every day

� Continue to improve the ways in which we communicate and engage the public and other stakeholders

RCE Performance for Worker Safety

National total recordable injury frequency five-year trend 12% decline – while exposure hours worked increased 49.2%).

2013 Annual fatalities increase from 4

to 8Note : In 2009, 17 fatalities from tragic helicopter accident.

0.000

0.005

0.010

0.015

0.020

0.025

0

5

10

15

20

25

2009 2010 2011 2012 2013

Fat

alit

ies

per

200

,000

hrs

# F

atal

itie

s

Absolute Fatalities and Fatality Injury Rate -Total

Atlantic Canada Helicopter FatalitiesFatalities (Number/yr)

Note: 2009 Fatality Injury Rate calculated without

Safety supports RCE Development

Facilitate sustainable safety performance improvement to:

� increase public confidence,

� attract the necessary human capital,

� integrate business objectives & public responsibility, and

� maintain international competiveness

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Economy

Society

Environment

Responsible Development

● Safety performance supports Responsible Development

● Performance levels have plateaued

� loss of drive and focus on safety

● Canadian performance lags behind international peers

● Industry faces increasing demands to improve

� low public confidence compromising social license

● There is a competiveness and productivity business case for good safety performance

Enabling Zero means facilitating a step change from current performance by focusing on a new framework.

Health & Safety Strategy - Enabling Zero

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Safety Scope: People, Process and Product

Framework: Leadership – Culture People - Process - Product

Leadership Enables a Culture of Zero

A Culture of Zero shapes all decisions

People: Zero Public Fatalities/Injuries

Zero Worker Fatalities/Path to Zero Injuries

Process: Zero High Consequence Incidents

Product Stewardship: Zero Product Losses

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Product

ProcessPeople

Safety Culture

Leadership

Health & Safety Strategy

Enabling Zero:

Leadership: Zero is possible

Safety Culture: Zero incidents is achievable

Public Safety: Zero public safety incidents

Worker Safety: Zero worker injuries/illness

Process Safety: Zero high consequence incidents

Product Stewardship: Zero product losses

1. Occupational Health & Safety Regulations,

• AB OHS Code Part 37 Oil and Gas Operations

• BC, SK, and MB to follow

2. Worker’s Compensation Board (WCB) Data Harmonization and Extension Initiative

3. Working Closely with Enform as our Safety Association

• Process Safety Management

• Safety Culture

• Performance Measurement & Metrics, and

• Communication and Advocacy.

Key Health & Safety Initiatives

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Final Thoughts

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