Shell Expro Sept-Oct 1999

Management Presentation on Phase One findings from

your PSMR audit.

Presented by Lead Auditor to ShellExpro

Leadership Team on 22nd October, 1999

Shell Expro Sept-Oct 1999

Principal Findings

● Violation in operation of Process plant● Non-compliance with routine maintenance● Flawed PFEER verification process● Operating with intolerable risks● Constant imbalance Production/Cost vs.. Safety● Ineffective Audit & Management Review process● Asset Management checks and balances● Manning, Planning and Activity Levels not aligned● Inadequate communication and consultation● Inappropriate attitude, skills and behaviour

Shell Expro Sept-Oct 1999

Violation in Operations

Review of handover notes indicate that violation is commonthe violations varied in severity from procedural nonconformance e.g. Permit to Work System - and to operatingplant outwith its design and operations envelope Violations of operating procedures were witnessed during theAudits - these violations were known up and accepted by theAsset Manager - Many violations are known about by theworkforce Violations included falsification of maintenance records forsafety critical equipment

Shell Expro Sept-Oct 1999

Examples of Falsified Records

BB Oil test separator with passing LCV was beingoperated with a combination of overrides on low level andcontinual operation of an XCV downstream of the LCV -the overrides were not being recorded in the control roombook - situation had persisted for a number of weeksMain BB gas riser ESDV failed LOT (at least twiceperformance standard) platform started up immediately -the Work Order indicated that the ‘ESDV had no faultfound’ .Oil Mist Detectors on BD remained isolated for over a year- External PFEER inspector had signed off ‘in good faith’but no action had been subsequently taken

Shell Expro Sept-Oct 1999

Brent Bravo et al - Goal WideningObjectives

Is the ‘goal widening’ rather than Goal Setting regime apresent SAFETY, and future REPUTATION issue ? GAS PIPELINERISERESDV Leak OffTest (LOT)CRITERIA

Above1 cm/mintakeimmediateactionto replace

Above4 cm/mintakeimmediateactionto replace

Above20 cm/min replace atnext plannedshutdown

DELUGERESPONSECRITERIA

20 seconds 60 seconds 100 seconds

Safety & Reputation RISK

Shell Expro Sept-Oct 1999

Overview of Brent Bravo

Brent Bravo with 156 person on boardOperation of test separator in violation of codesLOS gas detectors were inhibited - outputs isolatedUnauthorised overrides in Control RoomSkid deck covered by heavy equipment - explosion venting impaired - casualcontrol over sameMany Permit to Work violations observedFire pump ‘only one run left on pump, only use in anger’Fireman being used to supply cooling water to drillingTwo minor gas leaks - valve stems (not reported)Emergency Generator questionable reliability (air in lube oil )Seawater (PCV) discharge to sea jammed openLow levels of safety critical maintenance compliance (14%)OIM had no overview of the above and many other dispensations/deviations

Shell Expro Sept-Oct 1999

Manning and Planning

Role combination is enacted prior to competence attainment, competence isdeveloped on the job - safety critical activities can drop out which are not thenpicked upManning reduces, but activities remain the same or increase, not at steady state,excess hours worked with no adequate control on thisLow numbers leads to reduced flexibility for unexpected workload, training andprogression etc. For example young trainee Shell technicians feel trapped withdevelopment curtailedIncreased use of vertical relieving - no standard for what level of relieving isacceptable for key positionsOIM vertical relieving, no consistent Policy - OIM vertical relieving 80 days per yearPlanning processes across platforms vary from good to chaotic, still high level ofplanning offshore Equipment can arrive offshore and be worked on prior to ‘design pack arriving’

Shell Expro Sept-Oct 1999

Human Factors

A number of individuals in the organisation admitted that theywere coping with high levels of stress - teams also indicatedconcerns for the stress levels inflicted on their supervisors Throughout the organisation people up to Management levelare aware of issues, they are concerned, but remain passive In this PSMR Review human factors play a consistent part inthe breakdown of essential controls - is inappropriatemanagement ‘style’ driving and shaping team behaviour andattitudes that then results in the breakdown of controls at theworkplace?

Shell Expro Sept-Oct 1999

In conclusion

Objective of PSMR Review was toAssess the adequacy & effectiveness of controls in place to manage safety inplatform operations Opinion of PSMR Review TeamThe sampling process of the organisation has verified that there are significantweaknesses in essential controls. In our opinion the fundamental reason forthis is not the absence of structures, systems and processes but rather thatinappropriate attitude and behaviour causes non compliance, or deviationfrom, these control processes. We believe that the key business drivers and messages from corporate levelare fostering undesirable behaviour in the organisation both onshore andoffshore

Shell Expro Sept-Oct 1999

Immediate Recommended Actions

Shell Expro should take immediate action to reduce the risks ofoperation on Brent Bravo specifically and the Brent Field in general -Risks on BB at present - as witnessed during recent visit - are intolerable- we are aware of no remedial action being taken to reduce these riskssince the visit to this installation almost two months ago.

Weakness and deficiency is apparent in thecontinued operation of plant and equipment outside design envelope andviolation of operating procedures e.g. Permit to work

management of changes to plant and operating parametersrecording of accurate records for the testing of safeguarding and other SCE* (it was established that false records were entered into databases for oilriser ESD Valve)changes of performance criteria for SCE with no thought to the implicationsof such change - the goal widening approach* SCE - Safety Critical Equipmentchronic deviation from safety critical equipment routines with no priorapproval or risk assessment

Shell Expro Sept-Oct 1999

Immediate Recommended Actions

Shell Expro should take immediate action to reduce the risks ofoperation on Brent Bravo specifically and the Brent Field in general etc

Weakness and deficiency is apparent in thelack of controls in the inhibition/overriding of safeguarding systemsfailure of the independent external and Shell internal verification process topick up the weaknesses highlighted by the PSMRfailure to ensure that only competent staff who are assessed as suchperform safety critical rolesFailure to notify and otherwise inform workforce on BB specifically ofintolerable risk levels and what is causing samefailure to notify HSE (Regulator) of the true circumstances surroundingrecent press and media coverage e.g. lack of compliance with SCEmaintenance raised by OILC et al( what OILC was claiming and newspapers/TV were reporting was factual, infact situation much worse, but recent Shell Press release statementsindicate all is well, not to worry etc. This will be a huge REPUTATION issue,if the above PSMR findings leak onto the streets)Other business not related to BB - Failure to correct injustice to CAtechnicians disciplined in process now known to have been flawed