From the 2009 chairman: Industry must walk the talk on environment

Posted on 04 February 2010

 

Claus V Hemmingsen, Maersk Drilling

Claus V Hemmingsen, Maersk Drilling

2009 is behind us, and it is time to take stock of the past year and relay the baton of the IADC chairmanship to Louis Raspino, president and CEO of Pride International. Chairing IADC in 2009 has been a great privilege, and I pass on the assignment with mixed feelings.

2009 had a rough beginning in a world that found itself in its worst financial crisis since the ’30s. Prospects were bleak, and most economists did not dare to predict how the situation would turn out, let alone be positive. The demand for drilling services decreased at a pace impossible to foresee, leaving the industry far from the summer of 2008, when oil prices peaked at close to USD$150 per barrel. As 2009 began, oil prices had fallen to around $34 per barrel. Facing that reality, I assumed the chairmanship wondering how our association would fare and what countermeasures we could take.

Decreasing oil prices obviously had a huge impact on all of us. On top of the normal supply/demand balance turning upside down, the newbuild boom left us with overcapacities in most segments, both onshore and offshore.

Despite these gloomy prospects, 2009 turned out to be a relatively satisfactory year after all. Oil prices have risen considerably and, without being ostentatious, ended at around $75 per barrel, with rising activity levels resulting in most drilling markets. Natural gas prices remained weak, however, and only slow recovery was seen in the onshore markets.

IADC’s management team, headed by Dr Lee Hunt, early in the year instigated cost optimisation and efficiency improvement measures, ensuring that IADC came out of 2009 with good finanical performance and well-preserved strength.

My priority as chairman has been to drive forward environmental sustainability. With climate change moving up the public agenda and global warming becoming more tangible, the world is demanding solutions that will reduce the environmental impact caused by human activity.

Oil and gas-related industries are often described as sinners when it comes to global warming. My aim has been to show the world that we do care for the environment and develop solutions reducing our environmental footprint. To prove our commitment, we have to walk the talk. Saying that we care is not enough; we need to demonstrate this by taking actions. I believe that the many IADC activities, notably topical conferences, go a long way to this effect.

During 2009, IADC also provided an opportunity for members to drive forward with environmental sustainability. With the introduction of a new voluntary environmental reporting and benchmarking setup at our Annual General Meeting in November, we came a lot closer to achieving this goal. The system, devised by the Environmental Policy Advisory Panel (EPAP), encompasses many key performance indicators to measure and benchmark our environmental results.

Naturally, establishing the system is only the beginning. EPAP now awaits our members to actively engage the system and take learnings and inspiration from it – as we did decades ago with the general safety reporting and benchmarking. A gratifying commitment has been received from major offshore contractors to use the system, which bodes well for its success.

EPAP is launching more initiatives to encourage environmental sustainability. Presently, the group is working on creating common standards for reporting loss of containment, comparing and benchmarking product evaluation and substitution, and conducting awareness training. I am convinced that these initiatives will add to a greener focus in the entire drilling industry.

Most important on leaving my role as 2009 chairman is to extend gratitude for the support I have received from members and my deepest respect and appreciation for the IADC team – management and staff alike. We, as an industry, are blessed with having a competent and extremely diligent team of people serving us as members. This resource makes all the difference in the world. I thank all of them for their kind assistance and great cooperation and for making my chairmanship a wonderful and memorable experience.

Now, I wish to take the opportunity to wish all of you a happy and safe new year and once again to welcome Louis Raspino as our 2010 IADC chairman.

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