Flexibility in cutting production, operating and capital expenditure costs when the oil price is low without putting people and assets at risk will become ever more critical to survival. There are plenty of interesting insights that I’m glad we shared with you. Infiniti's Industry Experts Announce their Recent Success with Operational Risk Analysis for an Oil and Gas Industry Client Let’s suppose that I’m an executive in the Oil & Gas industry and I tell you, JG: Looking at the four questions and answers above, it seems that one emerging, common theme is, 5 questions and answers on environmental compliance. For example, don’t assume that sending a couple of e-mails will do the trick. To start with, it’s critical to accurately identify all stakeholders. Though this industry is a large and prosperous one, it also has a lot of risk involved with it. How will the new technological landscape affect me personally? An integrated approach to combat cyber risk: Securing industrial operations in oil and gas. Do new things. In other words, people are starting to expect the same features, connectivity, ease of access, and depth of integration as commodity technology. We have just recently used this method to support a number of oil & gas companies in overcoming the technical plateau through a breakthrough culture change to secure cash from operations and prepare them for the eventual industry rebound. What’s more, the permit includes information on past incidents, as well as lessons learned, such as protective measures to take. Many of these are experienced, older workers who would have been used as mentors or coaches for promoting the company safety culture. As mentioned above, operations take a lot of capital and time to get going, and they are not easy to … The findings allow companies to take a differentiated approach to risk and zero in on the top threats along the entire value chain. Although oil companies have seen some good safety performance figures in times when barrel prices were high, the industry as a whole operates in a fairly rigid and rules driven culture, in other words a dependent culture. This tends to have an effect on quality and hence safety of materials supplied. Although this may seem a tall order, it is possible to achieve with the right tools to identify and prioritise risks. Asset Productivity/Maintenance & Reliability, Integrated Business Excellence/Supply Chain Mgmt. Oil & Gas workers are either consciously or subconsciously aware of these innovations, and they naturally have an expectation that things will trickle down to industrial technology. It is during these times of price instability that operational risk management – the identification, evaluation and control of hazards based on potential levels of severity and likelihood of occurrence – should remain a top priority for companies in the oil and natural gas industry. Today you can do so many things with your smartphone: you can control the thermostat of your home, view what’s missing in your fridge when you shop for groceries, or even see who is at your door when the bell rings. Oil producers who cut costs will lay off personnel. Specifically, turn data and information into models where you can test scenarios before rolling them out in your operations. I’ll use another more practical and relatable example: permits. But let’s go beyond buzzwords. Otherwise the oil industry risks being hit by safety incidents whose roots lie in unfocused safety efforts now when the oil price eventually rebounds. Managing Risk in Oil and Gas Projects . JG: There are many types of ORM solutions today. The oil and gas industry suffers from outdated operational technology that makes securing it difficult. He has some questions. It is during these times of price instability that operational risk management – the identification, evaluation and control of hazards based on potential levels of severity and likelihood of occurrence – should remain a top priority for companies in the oil and natural gas industry. If carried out correctly, the results provide a barometer of the prevailing safety culture and help company management to direct their efforts at the right targets. Introduction, Objectives and Application The effective management of major accident hazards (MAH) is an integral feature of safe operations on offshore oil and gas installations. All rights reserved. I spoke recently with Michel Tol, Head of Product Marketing at eVision. Are you reaching out to both EHS and Operational Management staff? And finally, enable advanced analytics, especially predictive and prescriptive analytics. © 2020 DSS Sustainable Solutions. This also allows you to leverage the data included in permits for other processes (hazard assessments, barrier management, etc.). The second was with Kyle Schiber, Product Manager of Environmental Compliance and Process Safety at Enablon, and included 5 questions and answers on environmental compliance. When crude prices drop, oil producers have historically cut costs, but the impact of these cost cutting exercises is slow to take effect. But at least in Europe and North America, this is somewhat offset by the increased appeal of working in renewables (including hydro-energy, wind, and solar). It has allowed them to identify and stop urgent safety gaps, then assess and prioritise those areas that not only improve safety, but also offer productivity gains. Michel: Yes, but the problem goes beyond the potential loss of knowledge and expertise. What is often underestimated is the challenge of getting younger generations to be actually interested in Oil & Gas careers. This and other risks represent a real dilemma for the oil industry. This will ensure that transitions are less disruptive, and that you get the most value out of new innovations. As Figure 4 demonstrates, the drop in oil prices between 2000 and 2002 was followed by a six per cent rise in Lost Time Injury Frequency (LTIF) in 2002 and 2003. Operational Risk Analysis for an Oil and Gas Industry Client: Our Approach (Graphic: Business Wire) "Owing to the rising risks in the oil and gas industry, companies are finding it challenging to sustain a leading edge in today’s competitive marketplace. But if you could offer one tip on how to navigate through change, and only one, what would it be? This time we expand our Q&A series to our eVision colleagues. One tool that allows them to find out relatively quickly what areas need urgent attention is a professional safety perception survey of employees. You must be aware of their expectations, aspirations, concerns, and wishes. I had an interesting conversation with a high-level member of the delegation about the challenge of reinvigorating the attractiveness of the industry. Michel is also a thought leader who has presented at many conferences and has been interviewed by industry publications. It takes DuPont just 30 days to carry out such a survey and compile the results. The first was with Martin Vauthier, Head of Artificial Intelligence Analytics at Enablon, and included 5 questions and answers on AI in EHS. Safety managers need to be able to take the measure of their organisation’s safety culture to manage their resources effectively and efficiently. The Oil & Gas industry will face a wave of changes, including changes in personnel, software tools, processes, data management, etc. They must think outside the box. They’ll see graphics and models of a work site to be aware of their work surroundings. Operational risk management (ORM) is the systematic process of planning for, identifying, analyzing, monitoring, responding to, and mitigating operational risks. However, many oil companies are currently unaware of their cultural weaknesses, having focused their attention on other issues. Cost cutting exercises also lead to added pressure on suppliers to cut costs. Oil and gas companies face risks ranging from volatile commodity prices, which are less linked to basic supply and demand but more to global socioeconomic factors, to increased health, safety, and environmental pressures resulting from past and recent major accidents negatively impacting the environment, industry image, and its social lease. They cannot afford to wait until the oil price goes up again, otherwise future safety incidents are likely to cost both lives and output. Oil producers need to become more agile in adjusting if they want to remain profitable. The oil and gas industry’s most transformative moment is here. The information is delivered to the user in near real-time, synchronized with up-to-date data, providing a clearer, accurate picture of the work and work conditions. The Oil & Gas industry will face a wave of changes, including changes in personnel, software tools, processes, data management, etc. Change management is complex and there are many aspects to it. This is a true growth market. DuPont has been using regular safety perception surveys and HSE assessments of staff to assess the safety culture at its own businesses for years and has also effectively employed this approach to help many companies across a wide range of industries, including oil and gas producers, begin the journey of cultural transformation. While important and timely, sustainability is achieved by adopting long-term strategies to manage costs. Infiniti’s operational risk analysis experts developed a comprehensive approach to help the oil and gas industry client tackle these challenges. Are their staff, in the current situation, motivated and engaged in safety or have recent cost-cutting measure come at the expense of risk mitigation? The industry would benefit from a move towards a more independent culture which enables and can count on employees - and thereby the whole organisation - to make the right, safe decisions in often complex, fast- changing environments. The oil and gas industry easily has a large impact on the mass populations of the world, as they supply many useful products, the main one being gasoline. Following are five of the biggest risks in the oil and gas industry. The reasons for these increases in safety incidents are multiple. JG: There’s a lot of talk about Industry 4.0. JG: What is the most underestimated challenge in the Oil & Gas industry? 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