Oil companies look to in-house expertise, IT, cooperatives to enhance incident management
By TJ Engstrom, Clean Harbors
Breakthroughs in exploration technologies have opened up opportunities of historic proportions, but they have also brought new liabilities and responsibilities to the oilfield. The consequences of a spill are much higher now than they were just a few years ago from both social and fiscal liability standpoints
Legislators and the public tend to view the industry as a whole, extrapolating individual incidents into industrywide practices. The result – exemplary performers are easily associated, if not group-coupled, with other operators that have negative public images. Unfortunately, a negative image can be as much if not more damaging than the actual event. For instance, according to Pro Publica, in North Dakota alone between January 2009 and December 2011, 716,518 gallons of oil and 1,737,996 gallons of brine were reported spilled.
Understandably, this is causing increased frustration among agencies and trustees in the region. Consequences of such associations to the industry have numerous effects, such as on the issuance of drilling permits. There is now a drilling ban on tribal lands within a half-mile of Lake Sakakawea, increasing the cost to access leases under the lake.
There is a growing number of blowouts and other oilfield-related spills across the country. As a result, there is also a growing recognition that it is in companies’ best interests to work together as an industry to achieve better outcomes.
The spike in drilling activities over the past few years is forcing companies to embrace these liabilities and implement new internal investments. One of these investments has organizations taking on roles traditionally assigned to third-party spill response consultants. This is no small undertaking as new responsibilities affect every level of the company. There has been a notable relocation of highly experienced employees from spill management companies to large energy companies to help facilitate this undertaking. These companies see the return on investment in building their on-staff expertise to match the potential liabilities they have created with an increased footprint.
The benefits of in-house management of emergency response operations include overall program control, the ability to apply company-specific quality and performance standards consistently throughout the response, mitigation and recovery processes, as well as cost savings. In addition, having people on staff who are highly skilled in emergency response and who are used to working with compliance agencies often results in a new, higher-level corporate safety culture that transcends the organization.
Hess Oil, Anadarko and Statoil are examples of companies that have hired senior health and safety managers from spill management organizations. Having an employee with such expertise is a reliable method of building in-house capabilities to effectively meet the demands of an incident. If your organization is debating whether to create a new corporate emergency management position, this author’s advice is to do it.
Oilfield companies are also investing the time and resources to reach out to the communities in which they operate, through direct involvement with social organizations, trustees and other players in their operating areas. This approach offers an increased level of transparency between a company and the public, as well as government regulatory sectors. The benefits of having these relationships in place during a spill include increased cooperation from all parties, which expedites the response.
In addition to giving energy companies valuable insights into community issues and sentiments, this also enables the community to put a face on the company and to know how to interact with it in the event of a spill. The challenge, of course, is maintaining open communications during a crisis to keep accurate, timely information flowing. Spill response cooperatives are a great example of how energy companies create a platform for this interaction to take place.
The oil and gas industry has invested heavily in information technology. New technology in data management and display, such as 3D visualization, is being implemented more and more as traditional ink on paper cannot even begin to properly illustrate what computers can tell us.
Yet, secondary operating programs like spill response are usually underfunded and grossly behind on technology because the return on investment is not realized until a spill happens.
Many employees of oilfield companies have bookcases full of three-ring binders pertaining to everything from permitting to safety records to emergency response materials. These binders contain incredibly pertinent information that was costly to procure. However, there is a substantial challenge in connecting operational effectiveness with the information they hold.
To this end, industry leaders are researching new 3D information technologies to help with emergency response planning, preparedness and implementation. New approaches create interactive plans and use mobile technologies to put the necessary information literally in the hands of the responders. Imagine if your organization had a spill, and your field technician could use a mobile app on a phone to get directions on what to do and the resources available while simultaneously being digitally connected to other responders and to your corporate management.
Much progress has already been made on 3D technologies and the power of these types of tools will become more readily available in the near future. Several companies offer different software approaches to address oilfield emergency response (Table 1).
Spill response cooperatives
Another developing trend that further illustrates a corporate embrace of safety, responsiveness, financial and industry liabilities is the growth of spill response cooperatives (Table 2). Cooperatives provide the opportunity for companies from various lines of business that have spill exposure in a local or regional area to pool resources to better protect the public and the environment in the event of a spill. These resources are not limited to equipment but can include intellectual property, such as information from geographical assessments, cultural resources and training.
Cooperatives also create a platform for member companies to effectively communicate with trustees, citizens, public interest groups and governments on an ongoing basis. Cooperatives take many forms, with some being relatively small and tactically focused; others are more highly organized with mutual aid capabilities; and some have full-time professional staffs.
Cooperatives can be a powerful response resource due to the singular purpose of their existence. Companies invest to create a dedicated resource for themselves within a specific geographic area.
Expectations of emergency responders from both public and corporate standpoints are higher than ever. But the tools available to management – from National Incident Management System protocols, technology and the experience of past industry successes and failures – positions us for the future. It is the responsibility of every manager to plan and implement programs that enable corporations to practice sustainable business initiatives and respond at the highest level to emergencies in this incredibly demanding industry.
This article is based on a presentation at the 2013 IADC Environmental Conference & Exhibition, 8-9 April, New York City.
TJ Engstrom is an emergency response coordinator for Clean Harbors.