Royal Dutch Shell safety concerns
Developments in March 2007
In March 2007, several newspapers published articles in relation to Royal Dutch Shell safety issues.
On 5 March 2007, The Guardian newspaper published an article under the headline “Shell safety record in North Sea takes a hammering”. It reported that Shell had been warned repeatedly by the UK Health and Safety Executive - the "HSE" - regarding the poor state of the company's North Sea platforms. The article stated that on 13 November 2006, Shell had been served with “a rebuke and a legal notice that it was failing to operate safely”. An Aberdeen sheriff's court had previously ruled in a Fatal Accident Inquiry that Shell could have prevented two deaths on the Brent Bravo platform if it had properly carried out a repair. Shell had earlier admitted responsibility for the Brent Bravo accident. According to The Guardian, on the day of the sheriff's report, the Offshore Industry Liaison Committee had complained that the Brent Bravo platform still had “leaks, dangerous stairs, and lifts left broken for six months”. The article went on to say that in the summer of 2006, Shell had said that it was in the middle of a $1bn (£515m) programme to upgrade the platforms, claiming: "Safety is and will remain our first priority." The Guardian report drew attention to the HSE website which said that Shell was “issued with 10 improvement notices during 2006” and also pointed out that “Notices are served where the HSE considers a company is operating unlawfully with unacceptable risks”. The article also revealed that “Last year, Shell was embarrassed when Bill Campbell, one of its senior safety consultants, claimed the company was operating a weak safety regime and said some employees had been falsifying documents. Shell denied the charges, but Mr Campbell has been threatening the company with a defamation case”.
On 15 March 2007, The Wall Street Journal published an article on its online "Energy Blog" under the headline: “Shell’s Safety Problem”. The article compared the safety record of Shell with its rival BP, which has been heavily criticised for its poor safety standards since the deadly Texas City Refinery (BP) explosion in 2005. The Wall Street Journal highlighted the fact that “Royal Dutch Shell was a far more dangerous company to work for in the past two years” and also pointed out that according to an annual report filed by Shell with the United States Securities and Exchange Commission on 14 March 2007, 37 Shell employees and contractors died in 2006, compared with just 7 BP employees. In the same filing, Shell CEO Jeroen van der Veer was quoted as stating: “Our safety performance in 2006 was mixed” and “We have responded by reinforcing our safety focus through a dedicated global safety function that will improve compliance with standards and procedures worldwide.”
On 20 March 2007, The Wall Street Journal published an “Energy Blog” article on its website under the headline “Shell’s Record Worse Than BP’s”. The article cited a comment in a Wall Street Journal “Energy Roundup” report which said “...though BP has been chastised for its safety record in the past two years, it has not lost as many employees and contractors to death as rival Royal Dutch Shell, which employs roughly the same number of people”. The article also referred to a Financial Times story published on 20 March 2007 under the headline “Safety record is put in the spotlight” which had expanded the Shell/BP comparison to include several oil majors over more years. It quoted from the FT story: “Since 2003, the first year of the Times’s study, Shell has had more global employee and contractor deaths than the other four”. Shell has appointed a global vice-president for health, safety and environment to tackle safety problems and has pointed out that it operates in the dangerous Niger Delta, where militant attacks accounted for 9 of its fatalities in 2006. An update has subsequently been added to the Wall Street Journal article explaining why the headline has changed to “FT Data: Is Shell’s Record Worse Than BP’s? It explains “While it may be true Shell has had more deaths than BP in at least the past couple of years (which we’ve confirmed in their annual reports), it’s worth noting that these tallies are not necessarily the best measure of a company’s safety record, as they do not account for the number of accidents per worker.”
Resolution of Shell safety problems may impact on CEO succession
Concern over Shell safety issues has led to media speculation that the subject may impact on the appointment of a successor to Royal Dutch Shell Plc Chief Executive, Jeroen van der Veer, who is retiring in 2007. An article published by The Guardian on 29 March 2007, under the headline “Van der Veer - a safe pair of hands?” stated in reference to Van der Veer, “The one big area where he has fallen down is safety”. It went on to remind readers that the newspaper had revealed a few weeks earlier that Shell had “continued to receive warnings from the Health and Safety Executive that it is acting illegally with regard to safety in the North Sea”. The article concluded that “Mr van der Veer needs to bring a halt to this, and so does exploration and production boss Malcolm Brinded if he wants to stand any chance of taking over the top job”. Another article published by the Guardian on the same day, 29 March 2007, under the headline “Shell chief to stay an extra year beyond company retirement age”, also contained commentary linking the succession with safety issues. It stated: ”There will be a struggle to replace Mr van der Veer among the three managing directors: Malcolm Brinded, head of exploration, Linda Cook at gas and power, and finance director Peter Voser. Mr Brinded, 54, has been seen as a frontrunner but might be vulnerable over North Sea safety after revelations an internal audit found violations of safety procedures and the alleged falsification of compliance documents. Shell denied the latter charge".
Call to link Shell executive pay with health and safety issues
Health and Safety is an important matter in the oil industry, as has been confirmed by the dramatic events relating to BP. The degree of interest in the subject can be judged by the fact that since September 2003, over 120 news articles have been published relating to Royal Dutch Shell safety issues. The majority relate to the Brent Bravo fatal accident. An article published by The Times on 3 April 2007, revealed that The Local Authority Pension Fund Forum is planning a showdown with Shell directors at the 2007 Royal Dutch Shell Plc Annual General Meeting “calling on the group to link executive pay with health and safety issues, repeating a demand to BP, Shell’s rival, a week ago”.
The Brent Bravo accident and aftermath
The only fatal accident for which there is detailed information available is for the Brent Bravo North Sea platform tragedy.
Brent Bravo, located about 180 miles east of the
On 27 April 2005, BBC News reported that Shell had been fined £900,000, “thought to be the biggest fine on a company following a North Sea accident” after admitting breaching health and safety regulations. Sheriff Patrick Davies said that a "substantial catalogue of errors" caused the deaths of the two men, but he had taken into account that Shell had “tendered guilty pleas at an early stage”. The two offshore workers who died had been asked to inspect a temporary repair patch on a safety-critical pipeline in the leg. The patch “had been a temporary repair for 10 months”.
On 18 July 2005, a BBC News report revealed that Scotland's senior law officer, The Lord Advocate, had overturned a decision made by Crown counsel not to hold a fatal accident inquiry into the deaths of the two men on Brent Bravo on the basis that it would be in the "wider public interest" for an inquiry.
The Fatal Accident Inquiry Report into the deaths of SEAN SCOTT McCUE and KEITH SCOT MONCRIEFF was released in July 2006.
On 19 July 2006, an article about the findings of the Inquiry was published by The Times under the headline: “Unions call for manslaughter law after Shell deaths inquiry”. It reported that “The six-month investigation into the deaths on Brent Bravo in September 2003 concluded that the accident could have been avoided if Shell had done a proper repair of a pipe”. It went on to say “The victims, Keith Moncrieff and Sean McCue, died from a huge gas escape from an illegal repair to a corroded pipe when they descended into the concrete leg of the platform to make an inspection”. Shell was said to have accepted the inquiry findings. The Times article pointed out that Bill Campbell, a former Shell engineer, had come forward with details of a platform safety maintenance review carried in 1999 on the Brent Bravo platform. It said that Campbell’s audit team found “widespread violations of safety procedures and alleged falsification of records”. The article revealed that “Mr Campbell, who retired from Shell in 2002, believes that the Brent Bravo deaths could have been prevented had the company responded adequately to his finding that platform maintenance was being delayed to sustain oil and gas output. He tried to put his evidence to the inquiry, but the presiding sheriff declined to admit it on the ground that it was beyond the inquiry’s scope”. Shell was quoted as accepting the 1999 audit’s findings, saying that it responded with improvements. However Shell insisted that there was no verifiable evidence of falsification by platform management as Campbell had alleged.
Allegations made by Bill Campbell, former Group Auditor of Shell International
In June and July 2006, over a dozen articles were published by the news media revealing serious allegations by Bill Campbell, a former Shell International Group Auditor, whose name, as a result, is now inextricably linked with the Brent Bravo story.
Campbell’s allegations were the subject of a programme broadcast by BBC Scotland's investigative current affairs BBC 1 TV programme Frontline Scotland in a feature entitled: “The Human Price of Oil”. An article relating to the programme was published by BBC News under the headline “Shell ignored accident warning”, one of a number of BBC news reports on the subject. The Guardian newspaper published three articles, the first with the headline “Shell accused over oil rig safety”; the second entitled “Call for inquiry into oil rig safety regulator and the third “Shell confesses to poor North Sea safety record and pledges reform” A series of articles was also published by Upstream Online a respected weekly petroleum industry publication which also operates a related petroleum news website.
One of the most astonishing allegations was that "top directors of Shell Expro in Aberdeen, the UK arm of the Anglo-Dutch group, allegedly sanctioned a policy widely known as Touch Fuck All (TFA) whereby offshore installation managers were told to stop any work with the potential to cause unplanned shutdowns". The following paragraph is also taken from the same article by UpstreamOnline entitled "Shell in the safety firing line".
"The allegations levelled by Campbell against Malcolm Brinded, Shell’s group chief executive for global E&P, who was in charge of the UK business at the time, and his oil director Chris Finlayson, who is now country president of Shell Russia, claim the two men ran an operation where production took priority over safety concerns".
Shell was quoted as rejecting Campbell's charges. Shell said "The allegation regarding operating with high-risk levels is untrue and we absolutely refute this. Safety is and will remain our first priority offshore".
On 31 August 2007, The Guardian newspaper published an article profiling Jeroen van der Veer, the Chief Executive of Royal Dutch Shell Plc. The article by Guardian journalist Terry Macalister stated in reference to Van der Veer: "He also makes clear he was hurt by the coverage of another fiasco - when a Shell consultant, Bill Campbell, blew the whistle on safety breaches in the North Sea."
Joint Shell safety campaign by Bill Campbell and the website royaldutchshellplc.com
On 1 September 2007, The Daily Mail newspaper published an article about a safety campaign conducted jointly by Bill Cambell and the website royaldutchshellplc.com. The article said: “ROYAL Dutch Shell is getting rattled by a ‘gripe site’ that alleges there are safety problems with its North Sea oil platforms." The article revealed “An internal Shell email admits the firm has been thrown ‘on the back foot’ because of claims put forward on the Royaldutchshellplc.com website.” It went on to say “Campbell has emailed hundreds of MPs alleging Shell hasn’t yet properly tackled health and safety failings.” The article featured a number of quotes from Shell internal emails revealing a state of uncertainty at Shell about how to deal with the allegations. One stated: “As it stands we’re on the back foot and our aim should be to develop a strategy (or options) that puts us in a more positive and secure position.”
In his letter to MP's, Campbell stated: "I am a former Group Auditor of Shell International. I am writing to you on a matter of conscience in an effort to avert the inevitability of another major accident in the North Sea".
In response to the allegations, a Royal Dutch Shell spokesman was quoted in the Daily Mail article as saying: ‘Safety is Shell’s foremost priority at all times. Shell strongly disputes any suggestion that we would compromise safety offshore. No fatalities are acceptable.’
The Daily Telegraph published an article on Saturday, 9 September 2007 with the headline: “Pressure on Shell over safety of platforms.” It said: “Royal Dutch Shell is facing a growing campaign about alleged poor safety on several North Sea oil platforms, with Britain’s biggest trade union and a former executive of the company calling on MPs and the Health and Safety Executive (HSE) to investigate.” It went on to say "Mr Campbell, who has teamed up with a website that has been highly critical of Shell, appears to be of increasing concern to the company."
A further reference to the Campbell/royaldutchshellplc.com campaign was made in a whole page article published in The Sunday Telegraph on 9 September under the headline “Online revolutionaries”. The article mentioned that the website royaldutchshellplc.com “has been used to mobilise support for environmental campaigns by the likes of WWF, the environmental lobbying group, against drilling in the Arctic and Russia, for groups worried about Shell’s social impact in Ireland and Nigeria, and by the company’s former group auditor Bill Campbell to raise issues about employee safety.”
Offshore unions voice safety concerns over pending sale of Shell North Sea assets
On 6 September 2007, BBC News reported that “Two offshore unions have called on the Health and Safety Executive to investigate Shell's operations in the North Sea.” The unions were seeking “reassurances over worker safety”. They claimed “Morale is also at an all-time low and the departure of several key personnel has created gaps in safety critical positions...” The concerns stem from the pending sale of some Shell North Sea assets. The unions said that following Shell’s announcement that the installations were for being put up sale “communications between the company and the offshore workforce had deteriorated to the point it was impacting on operational safety.”
An article also published on 6 September 2007 by The Aberdeen Press & Journal, stated “Graham Tran, regional officer with the Unite union’s Amicus section, and the OILC’s Jake Molloy, say there are gaps in “safety-critical positions” on Shell installations which are up for sale.” The article went on to say “A joint statement from the unions says morale on the Shell installations is at an all-time low and that several key workers have left the company in disgust at the treatment they have received.”
On 4 October 2007 Christopher Hopson of UpstreamOnline, the leading oil industry publication, reported on high level talks between the UK's Health & Safety Executive (HSE) and Shell in relation to complaints by off shore worker unions over important safety issues. The article said that sources who attended the HSE meeting with management and staff on Cormorant Alpha revealed that the safety watchdog discovered a number of serious problems in the way the installation was being operated. According to the UpstreamOnline article, Jake Molloy, the general secretary of OILC, claimed his members on Cormorant Alpha "believed the validity of their complaints had been upheld and were awaiting the final HSE report to confirm this was the case."
Oil majors send safety chiefs to summit as criticisms mount
On 14 September 2007, The Independent newspaper reported in an article headlined "Oil majors send safety chiefs to summit as criticisms mount" that "Senior directors from the world's largest oil companies have agreed to attend a summit meeting next month in order to discuss working together to tackle health and safety issues." The article went on to say that "Heads of safety from oil majors including BP, Shell and Total will meet together for the first time in order to agree a joint approach to improving the industry's safety record." According to the article the "summit meeting" results from increasing concern among oil company executives "that a series of disasters and safety failures is jeopardising their reputation and damaging business prospects." Shell was said to be sending its head of safety, Kieron McFadyen, to the safety summit.
External Links
This entry is from Wikipedia, the leading user-contributed encyclopedia. It may not have been reviewed by professional editors (see full disclaimer)
