Introductory remarks - Ministerial Forum on Offshore Energy Safety

The accident with the Deepwater Horizon has been investigated in detail, spoken of and debated within the industry on numerous occasions. More than two years after the accident I think it is fair to say that no single accident in the petroleum industry has to such an extent been subject to extensive international attention.

The accident had a significant influence on the petroleum industry in several ways, and  caused a serious blow at the reputation of the industry. In the immediate aftermath of the accident, drilling in deepwater, high temperature and high pressure environments was questioned by the media, NGOs and authorities. In several areas deep-sea drilling was halted or limited for a period. Previous accidents and near accidents was also brought back to attention. It was a common impression that it was random luck, rather than skills that prevented similar accidents. In general we can say that the credibility and the good reputation of the industry were faced with a serious setback. Which it has not yet fully recovered from.

An accident is always untimely - and after an accident it is always timely to initiate improvement processes. It has been said that the only thing worse than an accident is having the same accident twice. The Deepwater Horizon accident has indeed been an ignition spark for a considerable number of improvement activities. Industry practice, emergency procedures and technological solutions which have been recognized by the industry for decades, are now subject to a critical re-examination.

Technical solutions for capping and containment, and a thorough review of the concept of blow out preventers, are examples of new technology and thinking. The natural and paramount question I would like to ask in this respect is: Why did we need an accident to initiate this improvement processes? The immediate danger and consequences the loss of well control may have to a drilling rig and its crew, is well known to the industry and the authorities.

The possible environmental consequence a large oil spill may have on the marine life is well known. We are also well aware of the inadequacy and limitations in some technical solutions we apply to maintain well control. And at last, if all other measures to prevent or halt a blowing well have failed, the way out is to drill a relief well. In best cases it will take at least 40 to 50 days.

As I see it, our knowledge regarding the inadequacy of the existing safety measures and the possible consequences was calling out for a review. As authorities and as industry, we should all try to avoid being in such a situation again. I believe it’s important that each and every stakeholder in the industry should be more vigilant to the possibilities for improvements. The authorities should take initiative to establish regulations requiring the industry to aim for continued improvement of the safety level.

I would like to go through some important principles in the Norwegian HSE-regime:

It is required in Norwegian legislation that the industry shall pursue continuous improvement. The industry has regardless of accidents or near misses, an independent obligation to ensure continuous improvement. The search for improvement opportunities should be just as important in the everyday activities, as in the aftermath of an accident. If we stop searching for improvement possibilities we become self complacent, and self complacency is a recipe for an accident. 

The requirement for continuous improvement must also be seen in combination with the goal based regulations. The goal based regulations allow the operator to choose or develop the specific solutions as long as they meet with the general safety level required. The goal based regulations must however be interpreted in light of requirements for continuous improvement. Yesterday’s solutions may not meet with the goal based requirements of tomorrow.

Norway has placed direct responsibility on the operator. Regardless of the use of partners or sub-contractors, the ultimate responsibility will always rest with the operator! The authorities’ supervision of the industry must not be carried out in a manner that can be regarded as a transfer of responsibility from the industry towards the authorities. The authorities role in Norway is to ensure that the industry steps up to its own responsibility.

The safety regime in Norway has been deliberately tailored so as to fit the working life model in Norway. Cooperation between employees’ organisations and the employers’ organisations is embedded in the regulations. We also have important arenas for tripartite cooperation involving the authorities. This tripartite cooperation has a considerable influence on the development and interpretation of the HSE regulations. We consider this cooperation between, and with the social partners as important for acquiring the safety level we have today, and for continued improvement!

Efforts to reduce risk on Norway’s continental shelf seems to be paying off. Figures from 2011 show favourable progress in key areas such as hydrocarbon leaks and well control incidents. These are areas which the authorities specifically have asked the industry to get to grips with. Another area where we face future challenges is petroleum activities in the Artic region. With the recent discoveries of oil in the region, we are rapidly approaching a time with permanent petroleum activities in these valuable and vulnerable areas.

Not only are the Artic particularly valuable in an environmental context, it is also facing us with safety challenges, such as ice drift, rough climate conditions and large distances. The environmental vulnerability of the area in combination with the new safety challenges, strikes at the very concept of our goal setting and risk based regulations. The immediate consequence is that the bar is raised significantly. How the industry will step up to this challenge will be a high priority issue in the authority’s follow-up of the industry. It should also be a high priority issue to all companies with ambitions in the Artic area.

Summing up my message in brief: It is essential for being successful in this industry and that is a continuous search for better and safer solutions. I will urge both the authorities and the industry to look at the existing standards and practice with a critical view, and to have continuous improvement as a guiding principle in their every day activity.  The concequences of a major accident is and will always be unacceptable.

The main purpose with this agenda item is to get a short presentation of all the priorities and efforts the Deepwater Horizon accident has initiated on an authority level.

In Norway we have given priority to three areas: 

• Barrier control
• Risk management
• Organisation and management

Barrier failure is often a causal factor in accidents and incidents. Constant challenges related to well control and integrity, hydrocarbon leaks and aging installations underline that the industry needs to pay special attention to these issues. It is also a need for better understanding of the interaction between organizational, operational and technical elements in barriers. Managing risk assumes recognition of its existence - and understanding of what the risk consists of. There is risk related to any activity managed by people, and it is important to be conscious of this risk and deal with it.

All efforts to prevent accidents and undesirable incidents from taking place, are about managing risk. An important element in risk management strategies and systems, is the establishment of several layers of safety systems and safety measures and barriers. They will reduce both the probability of incidents, and limit their consequences. Thus, it is impossible to manage risk if we do not know which elements risk consists of. Current risk management systems and risk analysis models can be said to be fragmented. Different risks are not subjected to an overall assessment. There is a need for more integrated management models, in order to identify potential conflicts and synergies between various measures. Errors can be prevented to some degree, but cannot be eliminated. That is why safety critical systems must have the ability to discover and handle such errors.

Finally, management and organisation at all levels of the industry must work to reduce major accident risks. And ensure that this work is pursued in an integrated manner. Experience and theory indicate that management plays a key role for major accident risk. Initiatives and decisions taken by management define and influence conditions which are of significance for such threats.

We will in 2012 focus particular attention on internal follow-up by the companies, and the overview they have of their own operations. Follow-up, including of contractors, is a key tool for exercising management responsibility in this area. Much attention will also be devoted to the responsibility of drilling contractors. How they understand and exercise this responsibility, and how management in the companies works to reduce major accident risk.

Now I have given my immediate reflections after the accidents, and presented the top three safety priorities in Norway. I look forward to hear more about the safety priorities in your countries.  

Thank you for your attention!