The Weekly Reflektion Week 16 / 2020

In the week 13 Reflection we quoted from W.G. Carson in 1981, 7 years before the Piper Alpha disaster. These were prophetic words on the limitations of the UK regulations for the offshore industry.

In the week 14 Reflektion we looked at some of the evidence presented to the Burgoyne Committee set up in the UK to learn from the Ekofisk Bravo blowout in Norway in 1977. Our intention was to show that there were indications that major accident prevention was not what it needed to be in advance of the Piper Alpha disaster in 1988. This week we will try to reflect on why these indications were not acted on and what we can learn from this reflection.

In the week 14 Reflektion we also referred to John Paterson’s book ‘Behind the Mask, Regulating the Health and Safety in Britain’s Offshore Oil and Gas Industry’. Paterson’s book also contains some relevant points on the economic risks taken in the development of hydrocarbons in the North Sea.

The discovery of hydrocarbons in the North Sea in the 1960s was a potential godsend to the UK. The trade balance with the rest of the world was negative and the demand for oil for the increasingly mobile population was likely to worsen the situation. The thought of the UK producing its own oil and gas and potentially exporting any surplus made development of the hydrocarbon resources in the North Sea a high priority for successive governments. Exploiting these resources in the harsh environment of the North Sea posed technical challenges and not just due to the extreme weather. The oil and gas reservoirs were deep and technically demanding to reach and produce. These technical challenges manifested themselves in the economic risks taken.

The oil companies also faced several other factors that increased the economic risk. Uncertainty from the government on tax, participation in developments and timing of licencing rounds. There were strikes and labour relation problems in UK industry that led to delays in the completion and commissioning of the platforms. There was pressure from banks and other institutions providing the loans that financed the developments. The oil companies had limited control of these factors hence were naturally focussed on factors they had control over, for example, maintaining production when the fields were in operation and keeping costs as low as possible. This led to resistance to changes from outside, including changes to regulations. The oil price increase in 1979/1980 saved the economic face of many developments however the culture of the oil companies, retaining control over production and costs was well established. The price crash in 1986 only served to increase resistance to change. While the factors and circumstances in this period, 1965 to 1988 (Piper Alpha), may be different to today, economic risk is always with us. The temptation to maintain control and resist change to mitigate economic risk is therefore something that we need to be continually aware of.

Two other factors that we alluded to in the Reflektions in week 13 and week 14 that were important in the failure to recognize the limitations of the UK regulations, were complacency and confirmation bias. There was a complacency in the industry and the regulator in not having a proper focus on hazards, mitigation measures for these hazards and a drive to reduce risk to as low as possible. These processes were already in place in the onshore chemical and process industries. The indications of potential problems, for examples fires, were interpreted as confirmation that the systems already in place would prevent escalation. The fact that no production platform in the North Sea had been destroyed by a hydrocarbon explosion or fire was considered confirmation that this could not happen.

Reflekt is in no doubt that the measures to prevent an offshore Major Accident in the UK and in Norway have improved since 1988 (Piper Alpha). The 2019 RNNP (Trends in risk level in the Norwegian petroleum activity) report shows a reduction in the Major Accident risk level and the Petroleum Safety Authority is encouraged that there is a positive trend. Economic risk, complacency and confirmation bias are however still with us. Economic risk we need to understand, to respect and to live with. Continuous focus is required to avoid falling into the traps of complacency and confirmation bias.

Prevention of Major Accidents is a bit like spinning plates to keep them from falling. All the plates need to kept going and the organisation needs to have focus on the many factors that influence the spinning and on any changes to these factors, for example oil price. The organisation also needs to be able to cope with more plates in the event of new issues or new focus areas from the management. Irrespective of how good we think we are; we cannot divert our attention from the plates. They do not spin themselves and we cannot let them fall.