Improving Contractors HSE Performance in the Oil Industry

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Improving Contractors HSE Performance in the Oil
Industry
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Introduction

• Todays oil industry is increasing its tendency
  to be more dependant on outsourcing most of
  activities for achieving its goals.
• Evidences can be seen in areas such as seismic,
  drilling, construction, logistics and maintenance
  that are generally executed using specialized
  contractors

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• Health, Safety and Environment is turning to be a
  high priority for most of the oil industry majors
  involved in Exploration and Production activities
  such as BP, Shell, Exxon, Chevron and others
• contractors are playing a definitive role due the
  high amount of man hours caused in their
  activities.
• In some cases man hours worked and incidents can
  be in a proportion of 8/1 where 8 corresponds to
  the contractors

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Background

• Todays legal and market requirements are
  getting more stringent and demanding to the Oil
  Industry companies. In todays incident cases is
  unlikely that the liability process differentiate
  on the responsibilities of the licensed company
  or its contractors and normally happens that in
  case of serious incidents the chosen one to
  respond is the most visible one which in our case
  is the contracting company.
• Contractors are an inherent part of companies
  operational infrastructures and a committed
  engagement is required when a high HSE
  performance is a must.

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Based on the analysis of 2381 million work-hours
of data, submitted by 39 companies from
operations in 75 countries
Million Man Hours worked
Man-hours Contractors
Man-hours Company
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FAR for Oil Gas Producing Company Contractors

• FAR No of fatalities

Fatal Accident Rate (FIR) The number of
fatalities per 100,000,000 (100 million) hours
worked
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LTIFR for Oil Gas Producing Company Contractors

• FAR No of fatalities

Lost time injury frequency (LTIF) The number of
lost time injuries (fatalities lost workday
cases) per 1,000,000 hours worked.
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KOC Contractors

• FAR No of fatalities

Industrial Disabling Injury frequency (IDIFR)
The number of lost time injuries (fatalities
lost workday cases) per 200,000 hours worked.
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A Successful Story Introduction

• In the East side of the Colombian piedmont
  (South America) BP hired in 1995 a national
  construction company to build 142 well sites and
  1200 km of pipelines to interconnect the wells
  with the 2 CPFs From now on we will call this
  contractor company IC.
• During the initial 6 months lots of work and
  interactions between BP and contractor was
  required to tackle the growing number of
  recordable incidents including 1 fatality. During
  the first year a total of 4.300.009 man-hours
  worked by IC resulted in, 94 recordable incidents
  and 1 fatality ending with a LTIFR 21.8 when the
  OGP were in 2.67 per million hours worked.
• A plan was put together which leads IC to
  complete 4 years with out fatalities, 9450.000
  man-hours free of recordable cases ( 2 years)
• IC is up to today the most reliable pipeline
  contractor in South America and one of the most
  awarded

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Picture-1 Cusiana Field
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Picture-2 Cusiana CPF
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Picture 3 - Cusiana Environment Sensibilities
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Picture 4 - Cusiana Project Interactions
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Successful Story Accident causes

• Lack of HSE leadership by the line management
• Lack of proper and solid training schemes
• Lack of work planning by the supervisors
• Lack of appropriate work procedures or
  procedures poorly applied.
• Poor Risk assessment and management
• Fear to report incidents due to blame culture
• Lack of minor incident reports which leads to
  loose the early warning stage to prevent
  recurrences.

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Successful Story How Improved

• Line management HSE agenda
• HSE Induction programme
• Daily tool box talk and JSA
• HSE Function and Line working together
• Transparent Incident reporting and
  investigation
• Work procedures
• Risk based Focus Programmes
• Permit to Work System
• Safety Observations
• Monthly HSE leader programme

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Successful Story The results

• After couple of years the good results produced
  and the high commitment demonstrated by IC, and
  other 4 years contract extension was awarded by
  BP to IC.
• IC turned to be in the rank of the few companies
  in South America making 60 million profit a year
  and the key success was their implementation of
  solid HSE structures interacting with QA QC
  across their organization and using this
  processes as reference of reliable reputation to
  make business world wide.
• IC was certified in ISO 9001, ISO 14001, OHSAS
  18001.
• IC has is been awarded with contracts of several
  million dollars not only in South America but in
  Europe and Africa

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Recommended Model
Contractor Interaction
Oversight Program
Identify HSE Risks
Identify Oversight Expectations
PLAN
Identify Contractor Requirements
Communicate Requirements
Identify Support CAMs, HSE Liaisons Roles Resp.
DO
Provide Knowledge Resources for Contractor
Implement Oversight Program
Evaluates Contractor Performance Routine
Oversight Audits
CHECK
Corrective Preventive Action
ACT
Management Review
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Recommended Model

• Contract HSE requirements are clear, practicable
  and detailed enough and leaving room for
  addendums when required
• Clear frequent communications process company
  contractor
• Visible companies contractor management
  commitment with HSE
• HSE Risks update based on project stages
• A solid HSE Induction process for contractor at
  all levels is a must

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Recommended Model

• Agree and communicate performance KPIs
• Identify roll out HSE Focus Programmes
• Transparent Incidents report process in a No
  Blame Culture
• Contractors Staff HSE agenda proactive driven
• Continuous improvement driven evaluation process
• HSE Forums
• HSE Award program

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What is KOC doing today?
Contractor Health, Safety and Environment
Oversight Procedure

• Project Pre-planning
• Designation of KOC Superintendent of contract
• Contractor pre-qualification
• Proposal process
• Contract award and execution
• Contract mobilization
• On-site project kick-off
• Contractor oversight
• Contract demobilization and closeout

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What is KOC doing today?

• Clause 22 of General condition of the contracts
• HSEMS guidelines for contractors
• HSE Incident Reporting Procedure
• Procedure for preparation of Project HSE plan
• Guide to Contractors Monthly HSE performance
  reports
• Participation during Safety Engineers seminar
• Participation during Safety meetings
• Participation in campaigns
• HSEMS awareness sessions, awareness materials
• Safety letters, Safety flash
• Suggested each manager to develop HSE statistics
  for each project

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Conclusions

• A safe contractor workforce will be an efficient
  team player
• Contractors HSE Improvement Processes is
  desperately needed to be consistent with
  companies HSE Policies and requires a systemic
  approach
• Improvement success will depend upon peoples
  commitment to pursue the best possible results in
  a consistent and persistent activity
• Contractors are at least 70 of our operations
  and part of our reputation is in their hands, are
  we doing something extra to ensure more
  reliability?