Learning Lessons from Incidents - BPs Integrity Management Standard OPERA Risk Management Seminar 27 March 2007 Peter

Elliot - Head of Integrity Management, BP

We Never Have Major Accidents !

I have never been in any accident of any sort worth speaking about. Nor was I ever in any predicament that threatened to end in disaster of any sort. I am not very good material for a story Veteran Sea Captain interviewed about his many years at sea in 1907. E J Smith Captain of the Titanic
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Titanic 1912 Titanic 1912

Todays Presentation

Integrity Management Challenge around the world Safety of Plant and People Integrity Management Incidents Managing Plant Process and People Group Operating Management System The Integrity Management Standard Engaging People in IM - IMagine the Difference you can Make Some thoughts on applying lessons successfully

Integrity Management Challenge around the world

BP is an oil, gas, petrochemicals and renewables company We employ around 96,000 people We have operations on 6 continents and in over 100 countries market capitalization $204 billion (as at Feb 2007) annual revenues/turnover of $262 billion (in 2005) one of the 10 largest companies in the world with approx 28,500 service stations worldwide serving 13 million customers every day

BPs heritage

What we do
BUSINESS SEGMENTS

RESOURCES
Exploration & Production

CUSTOMER FACING
Gas, Power & Renewables Integrated Supply & Trading Refining & Marketing

(including Acetyls & Aromatics from Petrochemicals)

Our global presence

Oil Gas Chemicals Refining Market positions

An opportunity and a responsibility

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Where our people are located

BP Sunbury ~3500
E&P R&M GP&R Middle East, Caspian & Russia 2,950 (100,000+ TNK-BP)

North America 39,200

Europe 42,600 Asia & Australasia 11,600 Africa 3,500

Latin America & Caribbean 4,500

Safety in Operations 2006

To ensure that everyone in and around our operations is always safe
Workforce Fatalities
30 25 20 15 10 5 0 1999 2000 2001 2002 2003 2004 2005 2006
1200 1000 800 600 400 200 0 1999 2000 2001 2002 2003 2004 2005 2006

non road related

road related

To ensure that plant contains hazardous materials (hydrocarbons and toxic materials) securely and sustainable
Oil Spills greater 1 bbl

Recordable Injury Frequency

1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 1999 2000 2001 2002 2003 2004 2005 2006

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Safety of People and Plant

BP has made significant progress in safety performance as measured by injury frequencies In addition, a number of safety innovations have been introduced e.g. Golden Rules BP also had recognised the need for, and benefit of, a consistent approach to Group risks e.g.. the Driving Safety Standard, introduced in 2004 Key Group Mandatory Operational Standards are Integrity Management Control of Work Driving Marine Operations (2007)
Piper Alpha Disaster

1.8 1.6 1.4 1.22 1.2 1.18 1.2 1 0.84 0.8 0.6 0.6 0.4 0.2 0
87 88 89 90 91 92 93 94 95 96 97 98 99 2000 2001 2002 2003 2004
Clear Vision Introduced Golden Rules of safety ASA BP Amoco Merger

1.56 1.44
Safety in Performance Contracts

0.44 0.43 0.43

0.39 0.27 0.25 0.19

0.13 0.10 0.09 0.08

Measures Days Away From Work Case Frequency (DAFWCF) per 200,000 hours 11

Why is Integrity Management so important?

Flixborough UK 1974 27 fatalities

Phillips Pasadena US 1989. 23 fatalities

Piper Alpha UK, 1988,167 fatalities

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Olympic Pipeline, Bellingham, June1999

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Belgium, July 2004

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Buncefield Oil Depot Dec 2005

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Texas City Refinery, March 15 fatalities, many injured

Thunder Horse PDQ Listed 21 degrees, now re-levelled

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Alaska Spill 2006

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the 3Ps- Managing Plant Processes and People

Three layers of protection to reduce the potential for major incidents and losses: plant engineering hardware, control systems, physical layouts processes management systems to identify, control and mitigate risks, and drive continuous operational improvement people capability in terms of leadership skills, relevant knowledge and experience, and the organizational culture they create Hard barriers are more reliable than soft barriers, but all ultimately rely on people

hazard reduction

hard barriers

soft barriers

hazard

accident or loss

physical controls

procedures

generic systems

peoples behaviors
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The role of leadership

HSE & Ops Performance & Risk

Plant Integrity

OMS & Process for Management

People & Culture

Leadership
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Evolution of BP HSE Management Systems & Management Interventions / Group Standards

The Journey: gHSEr has served us well delivering personal safety, A series of interventions have been used to supplement gHSEr in response to incidents, audit findings and need for further detail The BPMF and Code of Conduct provide context for a fundamental review
ISO management systems: 9001 (Quality),14001 (Environment), 18001 (OH&S)

BP Management Interventions MAR PSIM Golden Rules Driving Safety Specific Requirements oms
(BP)

General expectationsbased

Improvement of HSE management systems

Scoring system checklist ISRS Nothing formal

(commercial )

gHSEr OIAS
(BP) (BP)

Group Standards Integrity Mgt. COW / Driving Green Book

ASHEE
(Amoco)

OES
(ARCO)

Pre-1990

1991

1994

1998

1999

2002

2006

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OMS Framework

Business Processes
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Operating Management System

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OMS Continuous Improvement

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Building Blocks of Operating

Business specific

Sustainable Competitive Advantage

Excellence Efficiency

Business Impact

Neutral

Business Value Destruction

Basics & BP Requirements Legal Compliance

Catastrophic Loss

Significant Risk Mitigation

Essentials

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Principles
Measurement is used to understand and sustain performance We deliver what is promised and meet the expectations of our key stakeholders

Our leaders exhibit visible, purposeful and systematic leadership and are respected by the organizations they lead

Staff at all levels of our organization understand and manage risk

We have fit for purpose and agile organizations staffed with competent people.

We document and rigorously follow procedures for safe and effective operating

Our operations are continuously optimized to improve performance and delivery from our assets

Our plants, facilities and assets are fit for purpose throughout the lifecycle of the operation

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47 Sub-Elements of Operating
Results Metrics & reporting Assessment & audit Performance review Budget management Privilege to Operate Regulatory compliance BP requirements Community & stakeholder relationships Customer focus Ethics/Social responsibility Risk Risk assessment & management Safety Process safety Health Industrial hygiene Security Environment Crisis management & emergency response

Leadership Leadership and accountability Operations strategy & policy Planning & control Resources & implementation Communication & engagement Culture

Organization Organization People & competence Operating discipline Organizational agility Organizational learning Working with contractors

Procedures Operating procedures Management of change Information management & document control Incident management Permit to work

Optimization Plant optimization Energy efficiency Feedstock & Product scheduling & inventory Quality assurance Technology Procurement & materials Continuous improvement

Assets Plant integrity Reliability Maintenance & turnarounds Facility design & construction Projects & Operations integration Decommissioning &remediation

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What is the Integrity Management Standard?

The Integrity Management (IM) Standard is a BP Group functional standard that outlines accountabilities, practices, procedures, and competencies meant to ensure the physical and operational integrity of BPs facilities. The overriding objectives are to eliminate uncontrolled releases and prevent equipment or infrastructure failures so as to avoid serious harm to people, the environment and BP assets. It contains 10 Elements, each dealing with a critical aspect of facility design, operation, and maintenance. To whom does it apply ? all wholly owned and operated BP Business Units, projects, facilities, sites and operations..and BP shall endeavor to ensure JVs and contractors adopt the Standard When does it become operational ? By 31 December 2008 all BP operations must either meet the IM standard, have been granted an exception, or cease operations. 28

IM Standard Programme 2003-2009

Appraise
Loss of Containment identified as Group Level Risk

Select
Review of existing standards and documents carried out Gaps identified ETPs EAs MAR New Draft IM Standard written by crosssegment team Series of Crosssegment workshops planned and carried out to identify costs and benefits Metrics proposed

Define
GROUP By Q1 2005 Finalise and issue Define Stage IM Standard Issue Group IM Guidance document Agree Metrics Create Communication strategy and plan. Ongoing Supporting material developed to plan throughout 05 SEGMENTS By end 2005 latest Develop implementation Guidance Identify gaps to meet IM Standard Identify business Segment Planning with costs and produce implementation plans Functional Support Input budgets to annual business planning cycle

Execute
Issue Execute Phase IM Standard Phased execution based on business priorities within compliance period Segments/ BUs to close gaps versus plan Group and Segments to monitor and report progress against plan By end 2008 all applicable locations to be Exemption issued, or Closed

Operate
Ongoing validation of risk/benefits assessment based on actual performance

Management Framework identifies IM as a Group Functional Standard

Compliance with standard periodically reviewed via Internal Audit Effectiveness routinely reviewed and embedded in local and central performance mgmt Performance mgmt system core part of standard governance process

Continuing Integrity Incidents occurring around Group

2003 2004
Functional Analysis Function/Segment Consultation

Dec 05 Jan06 Dec08 Jan 09 update of Review and In compliance

Segment/ BU Implementation Segment/BU Standard by Function Operations

PSIM Std 2001

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Components of the Group IM Standard

Major Accident Risk And ETPs

PSIM Standard

IM Accountabilities (EAs, SPAs)

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Risk

IM standard mostly frequency reduction

MAR measures mostly consequence reduction

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Group Integrity Management Standard

IM Incident : Any incident where the root cause would be addressed by the IM Standard and there is actual or potential harm to people or the environment including loss of primary containment or failure of an engineered system.

M ajor Accident Risk Engineering Technical Practices

PSIM Standard

IM Accountabilities (EAs, SPAs)

1. IM Accountabilities - appointment of SPAs & EAs 2. Competence define critical IM competencies, assess staff & contractors 3. Hazard Evaluation and Risk Management - identify hazards, assess & manage risks. Mandates MAR of Group Concern to be reported to GVP Group Technology with action plan. 4. Facilities and Process Integrity - design for Integrity throughout lifecycle & compliance with STPs & operational practices 5. Protective Systems - Installation & maintenance of protective systems & devices based on hazard evaluations/risk assessments to prevent/ mitigate loss of containment 6. Practices and Procedures - STPs to be developed consistent with Group ETPs 7. Management of Change - all operations to apply a management of change process for temporary & permanent changes 8. Emergency Response - Plans in place to respond to a serious IM related incident 9. Incident Investigation and Learning - Investigate root causes of IM related incidents & share lessons to prevent reoccurrence 10. Performance Management and Learning - IM Performance management system with KPIs. Annual IM Group risk report identifying top 5 risks per SPU by Engineering Authorities for Group Engineering Director. 32

IM Standard Programme
Ongoing Risk Based implementation plans in the segments Monitoring of metrics/KPIs at Group and Segment level Raising IM awareness through Monthly Updates, New Group and segment websites, IM Standard Awareness DVD, Workshops. Quarterly performance management of IM to Group leadership Audit programme starting to be implemented with focus on action closeout by segments

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Integrity Management Learning

2. Integrity Management Learning from Past Major Industrial Incidents - the Process Safety Booklet Series ( see last slide for details) 3. BP Internal Integrity Management Information Pack DVD with key IM Issues Understanding the effect of small undetected changes on Integrity Management Getting workforce conversations underway on workarounds Integrity Management Standard Awareness film Group IM Website
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3. Recent Release Imagine the difference you can make

Process Safety Booklets BP/ I Chem. E /A I Ch E

BP Process Safety Series - Great sources of lessons learned both inside and outside BP Winner of the Frank Lees Medal 2004 for the most meritorious publication on safety and loss prevention IChemE:
Winner of the Frank Lees Medal 2004 for the most meritorious publication on safety and loss prevention. Produced by BP and endorsed by IChemE's Loss Prevention Panel, these books were developed to complement safety training. They are ideal reference tools within the workplace, increasing awareness of hazards and helping operators to understand safe operating practices and procedures.

I 10% IChemE member discount

Confined Space Entry Hazardous Substances In Refineries Hazards of Air and Oxygen Hazards of Electricity and Static Electricity Hazards of Nitrogen and Catalyst Handling Hazards of Steam Hazards of Trapped Pressure and Vacuum Hazards of Water Hotel Fire Safety Liquid Hydrocarbon Tank Fires Safe Handling of Light Ends Safe Furnace and Boiler Firing Safe Tank Farms and (Un)loading Operations Safe Ups and Downs for Process Units Control of Work Integrity Management Learning from Past Major Industrial Incidents (A I Ch E)

For more information or to purchase, follow the links or contact Book Sales on tel: +44 (0)1788 578214,

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Some thoughts on Applying lessons learned successfully

BP Chemicals Plastics Fabrications Group 1995-1998 Investigation Lessons Shared Lessons Learned Gaps identified and resourced to mitigate the risks Management leadership and commitment Operators belief in a safe workplace and continuously improving Culture where an unsafe act of process is corrected immediately Safety dramatically improved by factor of 20 in 2.5 years Success breads success

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