Offshore maintenance under the microscope

ExxonMobil and BHB Billiton West Tuna platform in the Kipper Gas Field, Bass Strait, Victoria

ExxonMobil and BHB Billiton West Tuna platform in the Kipper Gas Field, Bass Strait, Victoria

The National Offshore Petroleum Safety and Environmental Management Authority is cautioning industry not to shirk its OH&S responsibilities as pressure to manage expenses mount off the back of the lower oil price.

Stuart Smith, CEO of NOPSEMA says while Australian companies’ track records with maintenance upkeep have shown no sign of wavering, the regulator is keeping a strict eye on companies’ rig safety and maintenance programs.

“We are currently concerned with making sure no reduction in maintenance performance surfaces now with the lower oil price,” Mr Smith says.

“If companies are under pressure from prices in other parts of their business, it can show up in their maintenance costs. And while we have not seen a reduction now, it would not surprise me if we did in the future.”

The warning from the head of the offshore regulator comes after the organisation released its Q2, 2015 statistics for the offshore industry.

The data shows notifiable incidents are trending downwards in line with the total number of hours worked, which Mr Smith says is a good sign.

But while actual incidents are down, the number of OH&S related “dangerous occurrences” is steadily on the rise.

The regulator’s December 2014 yearly report identified that the occurrence of unplanned events requiring the implementation of emergency response plans had been trending upward for the past decade.

Ageing offshore facilities was named as a contributing factor to the concerning trend along with companies’ “deficient preventive maintenance”, which continues to lead to safety incidents and unplanned hydrocarbon releases.

“We are certainly looking carefully at the maintenance performance of the industryas a whole, particularly at the upkeep of
heir emergency response equipment.

“The reason I mention it is because in the experience of some of our inspectors, some have seen in international markets that after about four to six months after a significant price fall, there can be a deterioration in maintenance performance at offshore sites. We have been flagging this concern with industry since well before Christmas, 2014.”

The regulator’s data also shows hydrocarbon releases are steadily increasing. According to NOPSEMA, the number of releases rose from 20 to 25 last year with five already recorded in the first quarter of this year.

Mr Smith says he is concerned with the upwards trend and says industry should act swiftly to curb the number of damaging releases.

“This could be related to ageing facilities,” he says. “We have been working with our counterparts in the UK and Norway on their experiences in the North Sea where the average age of facilities is greater than the average age of facilities here.”

“We are in the education phase, talking and working with the industry on this issue. And beyond the education phase, if we do not start to see significant improvements, we will take enforcement actions.

“That is why we are flagging this well in advance.”

The oil price fall and the pressure to maintain optimal maintenance performance on Australia’s offshore rigs has so far resulted in “marginal” operators leaving the sector, according to Mr Smith.

“And such a consolidation will inevitably lead to a much better quality, safer and well maintained offshore industry,” he added.

But the regulator doesn’t only have its gaze focused on the future of older offshore technology.

The imminent arrival of the floating LNG (FLNG) in Australia has NOPSEMA ramping up its working knowledge of the new-wave industry in the anticipation of its future expansion.

Woodside’s Browse FLNG project entered the FEED phase in July, which will see costs and technical requirements finalised for the massive project and enable the joint venture to determine a final investment decision by late 2016.

Construction on Shell’s Prelude FLNG floating vessel continues this year in Korea with control testing of the 23,000 instruments currently underway. The timing of the FLNG deployment is yet to be determined.

“We certainly are expecting more FLNG facilities to come on stream in Australian waters in the near future. Sure it won’t suit every field and it will depend on the circumstances of each project, but we do expect more.”

“It is probably not surprising then that we are getting geared up for FLNG here in Australia, making sure we have the right experience to regulate it properly,” Mr Smith says.

“There are definitely some differences, such as managing cryogenic fluids and dealing with temperature variabilities, but there are also a lot of similarities in both traditional offshore and FLNG, and we think we do have the right experience within our organisation already.”

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