Oil and gas

The oil and gas extraction industry can be classified into four major processes:

(1) exploration,
(2) well development,
(3) production, and
(4) site abandonment.
Exploration involves the search for rock formations associated with oil or natural gas deposits, and involves geophysical prospecting and/or exploratory drilling.
Well development occurs after exploration has located an economically recoverable field, and involves the construction of one or more wells from the beginning (called spudding) to either abandonment if no hydrocarbons are found, or to well completion if hydrocarbons are found in sufficient quantities
Production is the process of extracting the hydrocarbons and separating the mixture of liquid hydrocarbons, gas, water, and solids, removing the constituents that are non-saleable, and selling the liquid hydrocarbons and gas. Production sites often handle crude oil from more than one well. Oil is nearly always processed at a refinery; natural gas may be processed to remove impurities either in the field or at a natural gas processing plant.
Finally, site abandonment involves plugging the well(s) and restoring the site when a recently-drilled well lacks the potential to produce economic quantities of oil or gas, or when a production well is no longer economically viable.
Risks related to gas exploration and oil production:
the geological nature of oil and gas fields, notably unexpected drilling conditions including pressure or irregularities in geological formations;
• the risk of dry holes or failure to find expected commercial quantities of hydrocarbons;
• the inability of service companies to deliver on contracted services;
• the inability of the Group’s partners to execute or finance projects in which the Group holds an interest;
• equipment failures, fires, blow-outs or accidents;
• the Group’s inability to develop or implement new technologies that enable access to previously inaccessible fields;
• the Group’s inability to anticipate market changes in a timely manner;
• adverse weather conditions;
• compliance with both anticipated and unanticipated governmental requirements, including U.S. and EU regulations that may give a competitive advantage to companies not subject to such regulations;
• shortages or delays in the availability or delivery of appropriate equipment;
• industrial action;

Safety and health management is one of the vital constituents of Oil and Gas industry activities because most of the operational conditions, chemicals and end products (hydrocarbons and other compounds) associated with Oil and Gas production are well-known to pose serious safety and health threats to the workers.
Hazards in Oil and Gas industry can be divided into two broad categories:

• Safety and Injury Hazards: Workers in Oil and Gas industry are generally susceptible to the following safety and injury hazards
Health and Illnesses Hazards Related to Oil and Gas Industry;’ Workers in Oil and Gas industry are generally susceptible to following agents which lead to various health and Illnesses hazards: chemical hazards (toxic, corrosive, carcinogens, asphyxiates, irritant and sensitizing substances); physical hazards (noise, vibration, radiations, extreme temperature); biological hazards (virus, parasites, bacteria); ergonomic hazards (manual handling activities, repetitive motions, awkward postures); and psychosocial hazards (overwork, odd working hours, isolated sites, violence).

The following table identifies the potential health effects from key processes in Oil and Gas industry:
Managing Occupational Safety and Health Risks: The aim of occupational safety and health risk management is to identify and assess safety and health hazards existing at the workplace and to define appropriate control and retrieval steps. Business processes in Oil and Gas industry are very complex. Hence it is essential that a systematized approach should be used for managing occupational safety and health hazards. Its solution model can be based on the PDCA Cycle:
Risk Management Process:
risk management is crucial for preventing work related injury and illness. It includes:

• Identifying the risks
• Evaluating and prioritizing the risks
• Implementing preventive/protective measures to control the risk

There are a number of circumstances in the Oil and Gas industry where a proper risk management process is essential:
• Job safety analysis: It is a process of systematically evaluating certain jobs, tasks, processes or procedures and eliminating or reducing the risks or hazards to As Low As Reasonably Practical (ALARP) in order to protect workers from injury or illness6
• Workplace inspections and audits
• Change management - identification of new hazards, introduction of new equipment/process, or regulatory needs
Generally, Risk Management Process in the Oil and Gas Industry Involves the Following Key Steps:
Occupational Safety and Health Management System (OSHMS):
The insinuation of implementing an occupational Safety and Health Management System at all workplaces came into limelight, when ‘Global Strategy on
Occupational Safety and Health: Conclusions’ were adopted by the ‘International Labour Conference’ at its 91st session, 2003. The Strategy advocates the application of a systems approach to the management of national OSH systems. Also, Guidelines on Occupational Safety and Health Management Systems (ILO-OSH 2001) provide national/organizational framework for occupational Safety and Health Management Systems8. As per these guidelines, the OSH management system should contain the main elements of policy, organizing, planning and implementation, evaluation and action for improvement8.

Benefits of Occupational Safety and Health Management System
• It enables Oil and Gas industry in performing hazard identification, risk assessment and implementing various control methods
• It ensures well-being of all the employees and thus contributes to a more inspired, and performance driven workforce
• Regular risk assessment process helps in frequent tracking and monitoring of health and safety indicators (both leading and lagging).
• Reduced costs associated with accidents and incidents
• Improved regulatory compliance
• Implementation of OSH management system gives competitive edge and improves relationships between stakeholders, such as clients, contractors, subcontractors, consultants, suppliers, employees and unions
the key for many companies is to ensure that all possible risks are considered and planned for, as the financial consequences of any mistake or disaster can push even the most well-funded firm to the brink of or even into bankruptcy. Here are some of the important things to consider when performing a quantitative risk assessment:

Potential Situations
Different companies in the oil and gas sector obviously engage in different facets of the process from drilling to distribution. Of course, the more dangerous aspects take place when establishing oil sites and beginning the drilling and extraction process. The scope of the project, the equipment utilized, and the topographical nature of the locale will all influence the types of problematic situations that may arise during the course of operations. Thus, one of the initial steps to take to quantify the potential risks involved with a project is to formulate the various scenarios the company may encounter. Granted, there is always the possibility that something unexpected will happen and there is no guarantee that the matter will take a specific direction. Nonetheless, it would be foolish not to come up with the problems that are most likely to occur so that some proactive problem solving and mitigation tactics can be set into motion. In addition to thinking about how much these issues could cost and what it would require to rectify them, the steps that follow will likely be an offshoot of the different types of situations anticipated or they may actually be problems on their own.
Hazards to Humans
Oil spills, explosions, and toxic fumes are valid concerns when it comes to working in anything that is oil and gas related. As a result, one of the more important components of the risk assessment is an analysis of the potential hazards that the project will have on the workers directly working at the site, as well as the residents in any surrounding areas. Unfortunately, these hazards may occur irrespective of a disaster or accident, and weighing the cost and benefit must occur to ensure that it will not result in unnecessary human exposure to dangerous chemicals. In addition to ensuring there is a proactive view as to the potential hazard, it is certainly within the realm of possibility that injuries or medical conditions that arise could lead to some kind of litigation. Therefore, it is important to consider the many costs that may be associated with those sorts of lawsuits.

Environmental Impact
Even if the risk to humans is relatively low, there is always the possibility of harming the environment, which can end up having long term deleterious effects on local residents. Plus, if the environment becomes polluted, whether by massive spill or unknown leakage, this can disrupt the local food supply, as recently happened in the Gulf. The environmental impact can end up costing significant sums of money, as the price of cleanup and restitution to those affected can be an ongoing issue for years and years into the future. Of course, it is also unwise to be the company that destroys precious land, and the damaged reputation will result in a whole bunch of other financial ramifications that are difficult to quantify.

Economic Implications
It is highly unlikely that the oil and gas industry will disappear any time soon, as there is continued global dependence on fuel and a fair amount of resistance to or simple disinterest in seeking viable alternatives. And, as mentioned and widely known, there is no denying the fact that this is a highly lucrative business, even though it is also a highly risky one. The reality is that all businesses must engage in risk assessments and take steps to mitigate risks as much as feasible. In this sector, it is obviously vital to perform these assessments on a regular basis and to ensure that they are accounted for in the annual budget. This requires sophisticated modeling and financial projections, so it is best to seek the advice and counsel of a seasoned professional.

What you get from us:
• PHA (Process Hazard Analysis)
• PSA (process safety management)
• Project risk identification and assessment
• Cost risk assessment
• Operational risk management
• Enterprise risk management
• Safety management