“Don’t let the noise of others’ opinions drown out your own inner voice”1
Attributed to: Jim Rae, Principal, Scientia et Sagacitas Limited,
Aberdeen, UK (a totally independent consultancy practice)
The ability to retain an independent stance, in the face of commercial and political pressure, is an exercise in tenacity.
In today’s decommissioning market, it is hard to maintain the necessary stance required for the role of “independent reviewer”. We rely on the integrity of academics, specialist companies and international regulators (and sometimes ENGOs and “Joe Public”) to keep it honest. Is it working?
In a word, I would suggest, NO! In so doing, I face the potential wrath of many parties, but here goes.
In the UK, as with the rest of the nations abutting the North Sea, we are a signatory to OSPAR, an international organisation established to protect the environment of the NE Atlantic waters. The requirements of its Decision 98/3 (a protocol introduced following the debacle of Shell Expro’s infamous Brent Spar decommissioning project in 1995) guide our UK regulatory framework. The principles of this historic agreement are a presumption of leaving a “clear seabed” and adopting a scientific/technical and evidence-based approach to gathering appropriate data as inputs into a fair and transparent process that assesses and evaluates the various options available and selects a set of solutions which the asset owners can make a case for in proposing a decommissioning option, set-out in a draft decommissioning programme, for regulatory, statutory and public consultation. Simply put, you start with accounting for an offshore inventory, you study and gather information on it and then use a rigorous and understandable process to come up with a proposed plan. This is shared with a wide range of interested parties and is open to public challenge, all under the scrutiny and guidance of a designated national regulator. Derogations from the “clear seabed presumption”, are potentially possible, subject to a suitably detailed “case” being presented and submitted by the national regulator to the OSPAR Secretariat for consultation with the other member signatories.
So, not a complex system, but one requiring specialist and public scrutiny at various stages. In the UK the process is overseen and administered by OPRED (Offshore Petroleum Regulator for Environment and Decommissioning) and its “Guidance Notes”2 set out various requirements for parties submitting Decommissioning Programmes (DCPs) for approval. One central theme, is the need to appoint a totally independent “reviewer” to validate that both the studywork/asset data is relevant and accurate; and, that the process used to evaluate the options is suitably fair, balanced, comprehensive and most importantly “fit for purpose”. It is up to the asset to select a suitably qualified and independent party for the task. Interestingly, I’m not aware of OPRED ever challenging such an appointment, nor for that matter, actually carrying-out any background checks on an appointee. Surprising, when you consider the influence the independent reviewer can have on the whole process!
So, who do you choose and why? For the first ever OSPAR derogation case, Phillips Petroleum Norway, went to great lengths to appoint a “board” of leading academics, from across Europe and Scandinavia, to form an IRG (Independent Review Group) for the complex Ekofisk Tank decommissioning project. Nobody would question either their expertise nor their total independence, their higher calling being to their academic or technical discipline area of study.
Taking this success into account, their UK counterparts, PPCo(UK), adopted a more informal, but no less rigorous, approach for the Maureen Project, with an IRG of international academics assembled under the direction and guidance of Dr John Shepherd, now Emeritus Professor of Ocean & Earth Science at University of Southampton. Both Ekofisk Tank and Maureen proved that, though perhaps a tad complex to manage logistically, an IRG comprising leading academics gave great validity to many aspects of these environmentally challenging projects, with issues such as polluted sediments, drill cuttings, marine disturbance and potentially complex transfrontier waste shipments. The success of the Maureen project is exemplified by the ability of the Company to establish good working relations with the regulator, ENGOs (notably Greenpeace, with whom scientific data was shared and operations monitoring programmes developed), Government scientists, and the huge raft of academic and generally interested parties.
Then along came BP’s NW Hutton project. Having seen the inevitable “herding cats” syndrome on the two projects above, BP selected an “IRC” (Independent Review Consultant/Contractor), a commercial company, well known in the industry and apparently acceptable to the regulator. This simplified the internal dialogue, but many external observers, questioned the suitability of such an organisation, when it relied heavily on oil companies for a large proportion of its work and income stream. Could “Chinese Walls” really work, particularly as BP were already a major client of the environmental consultancy? Not for me to question the integrity of those involved, but it did create a “grey area” for speculation and suspicion. As the jobs rolled out, others tended toward the more manageable IRC model. CNR International considered several contractors for the Murchison project, such as the Danish consultancies Ramboll and COWI, before also alighting on Xodus, principally on the basis of geographical proximity
For the massive Brent Decommissioning Project (the UKs largest), Shell Expro (a JV between Shell and Exxon) has adopted a fairly peculiar approach. Initially, the redoubtable Professor Shepherd was consulted and invited to propose an IRG team, drawn from top European scientists and engineers, with the intention of a maximum circa 3-year programme of verification. Well, the timeframe was wildly out and their work stretched from 2007 to February 2017. Not a bad wee earner! However, the partners, Shell and Exxon, also appointed specific individual experts to assess particular aspects of the huge and complex workscope, as well as verification bodies, like Lloyds Register, and subsequently engineering consultancies, such as Atkins (conductor status), to augment the process. There was also a focused stakeholders’ body, the “Cell Management Stakeholder Task Group” (CMSTG – eugh! – another example of oilfield jargon), to evaluate and report. Overall, in my humble opinion, this may have sullied the waters (pardon the pun) of responsibility and the Final IRG Report, is very cleverly written, so as not to give a full endorsement of the final proposals. Rather, a bit like like a qualified financial audit report, it leaves a number of aspects with a dubiety of meaning and intention. To my reading, it is far from an overall approval of the work to date and points to several key areas for further clarification. This has been picked-up by the scientists and engineers that produced evaluation reports for The Netherlands and German Governments, that form the basis for their ‘Formal Objections’ submitted to OSPAR as part of the Derogation Case consultation. Leaving OPRED, who presented the case, looking pretty feeble and ill-informed on the framework of international regulations, particularly regarding, comparative assessment, “dumping” at sea and definitions of “production wastes” and “structures that can be derogated”. The log-jam continues for both Owners and Regulator, as the process has stalled for over a year now and is still a long way from any mutually acceptable compromise! (incidentally, the Case also contradicts stated Government policy on the environment and international co-operation on same)
So, whom should we trust and why? Well, undoubtedly single independent academics and specialists are usually more interested in advancing knowledge of their “pet topic” and discipline, rather than commercial and financial reward. IRCs complicate the “trust map”, as most of the consultancies employed work largely in the oil and as sector for commercial gain. Plus, ownership often clouds the issue where large Tier-1 Contractors, or even oil companies, may have substantial shareholdings and influence on the IRC. This is the current case with Genesis and, until recently, Xodus. COWI, SLR and Ramboll are all heavily reliant on energy-related work to sustain them. Is it really fair to expect the individuals and teams within these consultancies not to be influenced by pressure from their respective managements with wider commercial factors and ongoing contracting relationships? It is certainly one for you, dear reader, to ponder over next time you see a Decommissioning Programme being presented for public consultation. But, I would suggest that perhaps, if it actually has the technical and commercial capability to do so, OPRED needs to evaluate and validate the true independence of the “independent reviewer” before just pocketing the submission fee and signing-off on the IRC/IRG findings and verification.
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