Margaret Leitch, global technical safety and risk leader and Adrian Gannon, senior technical safety engineer, of Xodus Group compare and contrast oil and gas operators in Middle East and Europe
In Europe, the oil and gas industry has had considerable time to evolve with offshore and onshore risk management requirements, considered the leading industry standards across the globe. Much of this learning has been done the hard way with regulation invariably being introduced following industrial disasters.
Buncefield, England (2005), Piper Alpha, North Sea (1988), MT Haven, Genoa, Italy (1991) and Amoco Cadiz, Brittany (1978) all raise unsavory memories for oil and gas professionals.
These are some of the blemishes in the European industry that led to an appetite for change. Yet, the most recent European directive has been in response to an industrial disaster outside the European region – BP Gulf of Mexico, 2010.
Following the disaster in the Gulf of Mexico, the European Commission (EC) expressed its initial views on the safety of offshore oil and gas operations in its communication ‘Facing the challenge of safety of offshore oil and gas activities’. On the 28th June 2013, the EC published the Safety of Offshore Oil and Gas Operations directive, requiring member states to introduce uniform minimum requirements.
This will result in changes to the UK Offshore Installations (Safety Case) Regulations 2005 but it is more likely to have a bigger impact on fledgling oil and gas industries in other members states, such as Ireland and Greece. With such developments in Europe the focus turns to the Middle East.
The Gulf region is a major exporter of hydrocarbon products and differs from Europe in that it is far less regulated while also maintaining a much more favorable record of major incidents. Given the magnitude of facilities in the Gulf, the severity of a potential disaster could be catastrophic.
So what do the oil and gas operators in the Gulf do in the absence of regulation? A comparison between operators in the Gulf and Europe illustrates two major differences: the complete or semi government ownership of oil companies in the Middle East, and; the sheer enormity of these national oil companies.
These two characteristics create an environment where self-regulation is feasible and sustainable. There is the argument that self-regulation results in non-verified operations and that operators may drop the requirement when challenges arise but verification by national regulators also has its weaknesses. Incident records make an argument for the self-regulatory approach used in the Middle East.
National Oil Companies (NOCs) in Gulf oil and gas producing nations such as United Arab Emirates, Saudi Arabia and Qatar have developed, or are in the process of developing, self-regulatory standards for safety case type requirements similar to Europe. Such organisations generally use the same terms that have developed over time in Europe and particular the UK such as COMAH (Control of Major Accident Hazard) and ALARP (As Low As Reasonably Practicable).
Many international oil and gas technical safety professionals are now very familiar with codes of practices used by Abu Dhabi oil companies which adopt risk reduction approaches that mirror those that are well-proven in other goal-setting regions of the world, especially the UK. Moreover in 2013 the Directorate (DG) Offshore Installations and Operations Regime in Qatar produced five HSE Technical Framework and Regulatory Regimes currently in draft format.
The content of these draft documents appear to be strongly influenced by European standards and serves to narrow the gap between requirements in Europe and Qatar.
Technical safety and risk concepts are good exports. Before sanctioning a project, operators in the Middle East go through the same scope of work as their European equivalents – typical studies conducted include HAZIDs, HAZOPs, SIL Assessments, Safety Case Reports and QRAs.
There are some subtle differences in typical Middle East client requests; for example in the Middle East it is common for clients to require distinctive safety studies to be competed at the same time as environmental and health studies. These studies are referred to as HSEIA (Health, Safety and Environmental Impact Assessments), a commonly used term in the Middle East. European clients would typically require studies to be completed on an individual basis – HIA (Health Impact Assessment), EIA (Environmental Impact Assessment) and HAZID (Hazard Identification).
This year Xodus Group is celebrating ten years operating in the global energy industry. A global presence in the oil and gas industry would not be complete without a footprint in the Gulf and wider Middle East region. Xodus Group has built on the expert knowledge developed in the UK and particularly Scotland, with extensive experience providing safety studies for North Sea operators.
However many consultants in the Xodus team have extensive experience working on other goal-setting legislation in other regions of the world that includes Australia and the Gulf of Mexico but also includes the codes of practice of Gulf operating NOCs.
Since its inception Xodus have been involved in the Middle East and made a decision to become more accessible to its clients by setting up a number of offices in the region. Xodus now has hubs in Dubai, Abu Dhabi, Erbil and Qatar, and has found that the consultancy services it has delivered to its clients in Europe are no different to those requested from their counterparts operating in the Middle East.
There are advantages and disadvantages to completing a HSEIA as opposed to individual studies but there are no major advantages or disadvantages and Xodus Group has not found any barriers when transferring skills developed in Europe to the Middle East.
Whilst the regulatory approaches of the energy industries in Europe and the Middle East vary, there is no indication that this is going to change in the future. As oil and gas companies mature in the Middle East, we are likely to see NOCs continuing to take a more active role in the absence of regulatory requirements, developing custom-written guiding philosophies supported by technical standards.
Xodus Group can testify that proven technical safety and risk methodologies and the associated deliverables remain largely universal in Europe and the Middle East. Different approaches yield the same results and allow the achievement of the same overall goal that is to reduce risk to personnel and the environment to a level that is As Low As Reasonably Practicable (ALARP).
