HAZARDOUS INSTALLATIONS DIRECTORATE OFFSHORE DIVISION

KEY PROGRAMME 3 ASSET INTEGRITY

KP3 HANDBOOK This is an abbreviated version of the handbook to show the range of activities the industry has been involved in.

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KP3 Project Handbook i

Contents

Preface .................................................................................................................................. iii

Part 1 - Programme Background......................................................................................... 1

Introduction.......................................................................................................................... 1 Aim ...................................................................................................................................... 1 Programme Drivers ............................................................................................................. 2 Programme Components .................................................................................................... 2 The KP3/1 Pilot Project - Data Assessment ........................................................................ 3 The KP3/2 Pilot Project - Maintenance Management/Backlogs .......................................... 4 The Belfry Workshop ........................................................................................................... 5

Part 2 - Inspection Programme............................................................................................ 7

Part 2.1 - Inspection Delivery .............................................................................................. 7 Part 2.2 - Templates & Reporting ...................................................................................... 10 Part 2.3 - Legislative Framework & Enforcement Policy ................................................... 13 Part 2.4 - 2004/2005 Inspection Programme..................................................................... 19 Part 2.5 - 2005/2006 Inspection Programme..................................................................... 19 Part 2.6 - Investigation Strategy ........................................................................................ 19

Part 3 - The Topic Team Coordination Initiative .............................................................. 20

Part 4 - The Working With Stakeholders Initiative ........................................................... 21

Part 4.1 - Step Change...................................................................................................... 22 Part 4.2 - Industry Installations Integrity Work Group........................................................ 23 Part 4.3 - Consultation with Other Stakeholders ............................................................... 26

Part 5 - Industry Senior Management Project .................................................................. 29

Part 6 - Performance Indicators......................................................................................... 30

Part 7 - Emerging Findings ................................................................................................ 31

Annex 1 - EP3/1 Report ...................................................................................................... 33

Annex 2 - The Belfry Workshop......................................................................................... 45

Annex 3 - Letter to Duty Holder ......................................................................................... 47

Annex 4 - SPC/ENF/100 ...................................................................................................... 49

Annex 5 - KP3 inspection programme – analysis ............................................................ 52

Annex 6 - Industry Installation Integrity Workgroup ....................................................... 55

Annex 7 - Glossary ............................................................................................................. 57

KP3 Project Handbook ii

Preface This handbook has been produced in support of the Asset Integrity Key Programme and includes useful information about the various projects that make up the full scope of the programme.

If a suitable printer is available the handbook can be printed in handy A5 booklet size, which enables convenient ready reference out of the office. The handbook is available on the bulletin board.

The bulletin board and this supporting handbook will be reviewed and updated at regular intervals.

Comments or suggestions on the content of this resource material can be directed at any member of the Installation Integrity Steering Group.

Alan Richardson OD3 - Project Manager Robert White OD5.3 Neil Dunford OD2.3 Iain Paterson OD3.4 Rob Miles OD3.6 Tony Blackmore OD3

KP3 Project Handbook iii

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Part 1 - Programme Background

Introduction A significant proportion of the offshore infrastructure is approaching or exceeding the original anticipated design life. At the same time the demands to reduce costs have resulted in rationalisation of plant and equipment maintenance arrangements. This had led to concerns in HSE that this situation, unless effectively managed, will significantly increase the risk of major accidents on the UK continental shelf. HSE believes the goals of significantly improving installation integrity and securing a long safe future for the UKCS are inseparable and interdependent. This view is closely aligned to the vision of the UK oil and gas industry PILOT initiative.

PILOT is the successor to the Oil and Gas Industry Task Force (OGITF) that was created in 1998 in recognition of challenges faced by the industry. The PILOT concept aims to unite the senior management of operators, contractors, suppliers, unions and relevant Government Departments in creating a climate for the UKCS to retain its position as a pre- eminent active centre of oil and gas exploration and development and production and to keep the UK contracting and supplies industry at the leading edge in terms of overall competitiveness.

To make this vision a practical reality, specific deliverables were defined. A key outcome for the 10-year strategy for Industry/Government co-operation is that by 2010 the North Sea, and the UKCS in particular, will be the safest place to work in the worldwide oil and gas industry.

KP3 is aimed at making a major contribution to achieving this outcome.

Aim The formal aim of KP3 is to ensure that duty holders effectively manage the risk of any failure of structure, plant, equipment or systems, which could either cause or contribute to, or prevent or limit the effect of, a major accident and/or cause fatalities.

In essence, KP3 is about the following:

• For OSD to use all its general and specialist resources to make an in-depth appraisal of duty holders' ability to manage the integrity of their installations in a manner that takes adequate account of health and safety;

• To identify deficiencies in maintenance and other activities that underpin life- cycle integrity;

• To use HSE influence and, where necessary, formal enforcement powers, to ensure that legal requirements are met and that any deficiencies threatening integrity are speedily remedied;

• To work with industry in a way that encourages good practice in integrity management, continuous improvement, and a minimisation of the potential for accidents.

Programme Drivers Though by no means applying to all companies or all installations, evidence from inspection and investigation show that:

• There are weaknesses in the implementation of statutory provisions for Independent Verification designed to assure duty holders that their arrangements for securing the integrity of safety critical elements are adequate;

• Cost control, reduced offshore manning, and multitasking can - if poorly managed - have adverse effects on health and safety performance;

• Some backlogs of maintenance are unacceptable;

• A number of significant incidents have been due to maintenance or integrity failures;

• In addition there is a need to maintain the current level of improvement in reducing the numbers of Major and significant hydrocarbon leaks and reversing the rising trend in Minor releases.

Programme Components The aims of the programme will be achieved by:

• Assimilating the findings of two pilot projects

o a data assessment project (KP3/1)

o a maintenance management/backlog inspections project (KP3/2) and outputs from the Belfry Workshop

• Into

o a 3-year inspection programme focussed on key integrity/maintenance management issues (KP3/3)

o coordination of other OSD Topic/Specialist work against the aim of the key programme

o mapping of stakeholder initiatives against the aim of the key programme and development of joint supporting projects with external stakeholders such as UKOOA/IADC/Step Change (KP3/4)

o sharing programme findings with all stakeholders.

It is the intention to implement KP3/3 on a year-by-year basis so that first year findings can be reviewed and the direction of the programme in future years adjusted accordingly.

The KP3/1 Pilot Project - Data Assessment This pilot project was started on 1 October 2003 and completed on 28 November 2003.

Objective The objective was to gather and review information that is relevant to installation integrity, in order to:

• show the need for the programme;

• investigate possible targets and measures that can be used to measure progress; and

• develop an information resource that can be used in other parts of the programme.

Sources of Information A wide range of data was reviewed, including:

• notices issued by OSD;

• incident data, including various categories of Dangerous Occurrence, Injuries with a Major Hazard potential, threats to integrity (Regulation 9 of DCR);

• investigation reports prepared by OSD;

• inspection reports prepared by OSD;

• information from Key Programmes and Topic Programmes;

• accident databases, eg. WOAD;

• installation age profile;

• open reports;

• experience from other industries/countries.

HSE’s ORION system provides the primary source for Notices, Incident data and Inspection reports.

Summary of Findings A wide variety of sources of information were reviewed, although this was limited to some extent by the time available. It is clear that there have been a number of integrity-related incidents and failures in recent years. It is also clear that there has been increased activity by OSD in connection with installation integrity matters over the last one to two years, probably driven by increased awareness of these incidents and failures.

It is already planned that the monitoring of hydrocarbon releases will continue, with associated targets for reducing the number year on year. A number of other measures have been examined, and although several may have some potential for development, no clear candidates have been identified that are highly useful and readily available. It is likely that any possible measures will need some form of voluntary reporting by industry.

The report contains a number of sources of information and guidance that may be of use to others involved with this programme and is appended in full at Annex 1.

The KP3/2 Pilot Project - Maintenance Management/Backlogs

Pilot Project Template This pilot project commenced on 1 October 2003 and completed on 2 April 2004. Eleven inspections involving five major operators were undertaken using a standard template. The template headlines are as follows:

• Maintenance Policy/Strategy • Enactment • Predictive Analysis • Number/Frequency of Breakdowns • Performance Standards • Backlog Justification • Deferrals Process • Traceability of SC definition • ICP Interface • Verification System • Replacement Parts • Repair Techniques • Role of TAs • Supervision • Competence • Capacity for human error • System testing

Initial Findings

• Maintenance backlogs

o some unacceptably high overall

o some SCE maintenance unacceptably high

• Corrosion

o frequent visual evidence, e.g. bolted, flanges/ex, equipment/handrails/ structure

• Maintenance management systems

o poor performance of some computer based systems

• Beach support

o poor communications in relation to front line activities by reduced offshore workforce increasingly managed from onshore

• Planning

o bureaucracy and workloads create conflicts in work planning process

• Supervision

o supervisors burdened with paperwork. Little front line monitoring of work quality. Heavy emphasis on perceived "competence"

• Performance Standards

o some inadequate. Some adequate but not followed

• Physical Evidence

o Housekeeping often below par

• SCE Performance

o 50% of functional tests on mitigation systems (eg. deluge) failed to meet performance standards

Evidence for Action Based on eleven inspections, sufficient evidence was gathered to justify the following ongoing challenges

• Is the maintenance function adequately resourced?

• Is the planning of SC maintenance efficient? • Is the quality of maintenance acceptable? • Is the performance of SCEs reliable? • Are inspection and audit standards optimal? • Is supervisory and engineering support solid?

The Belfry Workshop A good deal of the existing effort by IMT and Topic Teams is directed at ensuring installation integrity. The aim of the Belfry Workshop, held in January 2004, was to take into full account the fund of IMT/TT knowledge and experience and to use the workshop to add value to existing activity. This was done by identifying, reviewing and prioritising the key installation integrity issues to be addressed in the forthcoming year and beyond.

Prioritisation was undertaken against the following criteria:

• Hazard and Risk

o nature and consequence o population at risk o occupational hazard/risks o historical accident/injury rates o commonality across sectors

• Legislative Compliance

o level of compliance o compliance problems particular sectors o enforceability of Regulations

• Political Sensitivity

o HSE/HSC priority - level of concern o public perception of risk o aversion to major risk o interest of particular stakeholders o workforce perception of risk

• Practicability

o successful intervention likely o cost effective o HSE expertise available o virus (HSE's job?) o stakeholder interest/existing action o matched industry knowledge/competence

Forty-two issues were identified. The full list is attached at Annex 2. The top twelve issues were:

1. Integrity of piping repairs 2. Risk assessments and Hazops 3. Awareness of personnel 4. Valve failures 5. Hydrocarbon containment 6. ESDV issues 7. Maintenance quality and backlog 8. Lack of resources 9. Competence 10. Mitigation systems 11. Corrosion 12. (Ship Collision)

The template used for the KP3/2 pilot project has been reviewed against the Belfry Issues to produce a definitive template for inspections undertaken as part of the main KP3 inspection project - Part 2 refers.

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Part 2 - Inspection Programme

Part 2.1 - Inspection Delivery The inspection programme will be conducted as follows:

• The number of KP3 inspections to be undertaken during each work year of the project will be agreed and incorporated into the plan of work.

• Each inspection will be undertaken using a two-part (onshore/offshore) template, originally developed from the KP3/2 pilot and the Belfry Workshop but later modified during the 2004/2005 work year (the current versions - release 6 - are available on the internet as separate attachments).

• A multi-disciplinary team comprised of at least one IMT inspector and two topic specialists will carry out each inspection.

• Each inspection will take a total time of three weeks, to include an offshore inspection of at least three days duration plus pre and post onshore components and report preparation.

• The IMT inspector with responsibility for the installation to be inspected, if not the lead inspector, will be briefed on the inspection procedure and will retain the responsibility for inspection organisation and logistics. The installation inspector will have the right to accompany the inspection team but need not necessarily do so.

KP3 Inspection Team - Roles A KP3 inspection team, by default, will consist of three inspectors: one IMT and two specialists. However, for very large installations, or where there are known problem areas requiring a larger team, it is perfectly possible to expand this number to four or more. Similarly, for example in the south where installations are much smaller, it may be possible to do justice to the agenda with a team of only two.

It is especially important in KP3 that all inspectors work as a multi-disciplinary team, due to the considerable areas of overlap in the inspection plan.

The IMT inspector will lead the inspection, as is normal practice, and maintain their role as inspection facilitator. They also, together with the IMT team leader, will make enforcement decisions - although these may be based on the advice of the specialists, as appropriate.

Specialist 1 will be responsible for the planning and execution of the KP3 aspect of the inspection, the roll-out presentations to the duty holder, the selection of a system to test, the body of the KP3 debrief, the production of the report and follow-up items, and the eventual close-out. Any of these tasks can be delegated to Specialist 2 or the IMT in the interests of cascading experience, but Specialist 1 remains accountable for the KP3 inspection delivery. The responsibilities include completion of the KP3 inspection template including the traffic light classification system. The template, inspection report and a copy of the letter to the duty holder should be forwarded to the KP3 admin team (VPN 526 8007 Tel: 01603 828007) within 15 working days of the completion of the inspection.

Specialist 2 will have two functions: Firstly, to support Specialist 1 in the delivery of the breadth of KP3. Secondly, he will operate for at least some of the time within his discipline, insofar as it contributes to KP3. It will be for the team to decide to what extent specialist discipline areas of inspection are included in the plan, and adequate consideration should be given to the requests made by the IMT in this decision.

Preparation for the Inspection Send to the duty holder at an appropriate time prior to the inspection:

1. A copy of the templates

2. A letter introducing KP3, detailing the personnel to be seen and listing the documentation required prior to the visit. Suggested wording to be used in the letter is given at Annex 3.

KP3 Demonstration of Safety Critical System Operation It is not the intention in this testing programme to put duty holders under duress, or introduce unnecessary production loss. At the same time, it is essential for HSE, in the process of our KP3 inspections, to get a first hand feel for the physical performance of sample SCEs. Therefore inspectors should negotiate with OIMs in selecting systems to test, taking both the above requirements into account.

The testing of these systems may take time to prepare; therefore requests for demonstrations should be made in good time, ideally on the first day of the inspection. Any necessary preparation, including PTWs, inhibits and risk assessments, is the responsibility of the duty holder, who has at all times the option of cancelling or deferring the test on the grounds of ensuring a safe operation.

Some Suggested SCEs for Test A total of 16 tests are included in the KP3 inspection scope. These incude;

• HVAC dampers - introduce test gas or test smoke into fan ducting;

• Fire detection system - check operation of multiple detectors, with voted input to ESD;

• Gas detection system - check operation of multiple detectors, with voted input to ESD;

• Blowdown valves - check individual operation by "blocking in" manual valves - see maintenance routines;

• ESD interstage valves (on non-operating trains) - check closure against performance standard by direct methods or operation of ESD loop;

• Deluge (wet test) - select one area for test. Check all parameters in accordance with the performance standards. Consider simulated failure of sequential fire pumps;

• Fire pump operation - in response to a number of different initiators.

Inspectors may also choose to witness any testing of safety critical equipment that the duty holder has planned during the inspection visit, e.g. HIPS calibration checks, riser valve full or partial closure checks, etc.

Details of the results of the safety critical system tests carried out during the 04/05 inspection programme are given at Annex 5. There are large variations in the numbers of each tests that has been carried out. In order to obtain a representative sample of the full range of system tests inspectors have been requested, where appropriate, to select tests that have been tested less frequently in the past.

04/06 KP3 Inspection Programme Total No. of Inspections = 23 System No of Tests Physical State of Plant 45 Deluge test 11 Fire pump test 22 ESD valves 13 Fire detectors 10 Gas detectors 6 HVAC dampers 22 Emergency lighting 11 HIPS 0 PA Systems 1 Riser Valve 1 EX Equipment 3 TR Doors 1 Emergency Comms. 1 Ballast/Bilge 3 Crane 1

Identification of Best Practice The KP3 inspection programme will