February 23, 2010 | Mark Paradies

Judith Hackitt, Chair of the UK Health and Safety Commission, warns … “Be afraid…”

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I saw an interesting article at nuclearmatters.co.uk about a speech given by Judith Hackitt discussing the potential to have process safety accidents with multiple fatalities because of short-term business pressures. I thought it was a good speech that the article was based on, but that there were a couple of inaccurate impressions that needed to be corrected. So I left this comment:

I like Judith’s statement but there two slightly incorrect facts in her comments …

1) Judith said: “… lack of injuries and near misses is no guide whatsoever that all is well in process safety terms…”

BP Texas City DID NOT have a good safety record.

They were killing people almost every year. They may have kidded themselves into believing that they were improving safety (a little under-reporting can go a long ways) but they had an unacceptable rate of fatalities. These fatalities were proof that something was wrong.

Also, they had previous process safety incidents and near-misses on the very process that exploded that indicated problems and that were not corrected.

Thus, at least for BP Texas City, they should have seen this accident coming and prevented it. They had warnings. All they had to do was listen, find the root causes, and act.

2) Judith said: “Short-term business pressures drove BP to cut capital expenditure at its Texas City plant by deferring projects and failing to monitor the subsequent impact of this. This had a dramatic impact on the repair and maintenance programme at the site and was a significant factor in the catastrophic explosion in 2005.”

The cost cutting at the Texas City refinery was not short term.

It started before BP bought the refinery. BP should have known that they would have to INCREASE spending to make up for cuts prior to the Amoco sale to BP. Instead, BP continued to cut spending right up until the accident. That makes it five, six, or perhaps even seven years or more of underfunding safety and maintenance.

The Texas City refinery under Amoco/BP had backlogged safety corrective actions that were a decade past due when the accident occurred. Therefore, this was not just a one or two year budget cut problem. It was historical underfunding of a high risk process. Short-term business pressures may have caused this underfunding in any one year but the impact was long-term and establish a culture of shortcuts and a “make it work” mentality.

Reasonable management should have been able to see that this game of process safety Russian roulette can’t go on forever. Eventually, someone has to “pay the piper.”

The fact that management can get away with underfunding safety and maintenance for several years without an accident is what makes taking shortcuts so tempting. This is especially true when managers are quickly promoted so that they don’t stick around to see the impact of their business decisions on performance at a complex facility (like the Texas City refinery). The wrong lessons (we can cut costs without noticeable impact) are reinforced as the market (and benchmarking surveys) rewards those with the highest production and the lowest costs. Management is not required to understand or face the long-term impact of their decisions.

Therefore, I still believe that many executives have not learned the lessons that:

1) You must work diligently to learn from your experience (they think Texas City was a surprise when it should not have been a surprise).

2) There is a point below which you should not cut the budget on a high-risk enterprise.

You must have strict standards that can’t be compromised and you have to say, “No – We won’t continue to operate without support for these safety initiatives.”

If management (especially senior management and corporate boards of directors) fails to learn these lessons and continues to operate high risk facilities as if they were any standard manufacturing plant, we (society) are doomed to see accidents with causes like those that caused the explosion at Texas City again.

Lest one thinks that this is only a problem for refineries and chemical and oil industry facilities, look no further than the Davis-Besse reactor vessel hole for a near-miss that was only prevented by the regulator saying “No” to a utility request to cut inspection requirements again.

No high hazard industry is immune to the temptation to get buy with less and the failure to listen to the warnings of operating experience.

Best Regards,

Mark Paradies

What do you think?

Has management learned the budget and operating experience lessons from Texas City?

Have they established strict standards and drawn a funding line that can’t be crossed?

Are they interested and actively promoting analysis of operating experience, advanced root cause analysis, and prompt implementation of corrective actions?

Or have things gone back to business as usual?

After all, the five year anniversary of the Texas City refinery explosion is just around the corner.

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