BP engages with socially responsible investors
BP’s Mark Bly and Bernard Looney have met with socially responsible investors in London and New York as part of the company’s ongoing commitment to communicate progress on safety and risk management to investors
Around 75 individuals attended the meetings to learn more about the actions BP is taking in the wake of the Gulf of Mexico oil spill.
Bly, who heads the new safety and operational risk (S&OR) organization, used his presentation to explain how BP intends to reinforce safety and risk management as at the heart of the company. He highlighted four areas of focus:
Bly, who heads the new safety and operational risk (S&OR) organization, used his presentation to explain how BP intends to reinforce safety and risk management as at the heart of the company. He highlighted four areas of focus:
1. Embedding the lessons from the Deepwater Horizon accident in our new Wells organization;
2. Furthering our emphasis on ‘high consequence, low probability risk’ issues by setting the right management tone and expectations, including enhanced risk reviews and governance;
3. Strengthening existing initiatives, such as our group-wide operating management system (OMS), expanded scope for S&OR audit, and capability development; and
4. Providing increased checks and balances by embedding the S&OR organization.
2. Furthering our emphasis on ‘high consequence, low probability risk’ issues by setting the right management tone and expectations, including enhanced risk reviews and governance;
3. Strengthening existing initiatives, such as our group-wide operating management system (OMS), expanded scope for S&OR audit, and capability development; and
4. Providing increased checks and balances by embedding the S&OR organization.
He went on to explain that S&OR will be made up of a central team of experts and a team of specialists deployed alongside BP’s operating businesses. The central team includes experienced professionals with backgrounds in nuclear, military, aerospace and chemicals disciplines, as well as oil and gas.
The deployed team members, said Bly, will act as “absolute points of clarity” in the businesses. He reiterated that the business line management continues to be accountable for identifying and managing its risks, but that the new deployed teams will provide “assurance champions”. So far, around 360 individuals are in place and Bly expects to build a team of around 800 in total.
The deployed team members, said Bly, will act as “absolute points of clarity” in the businesses. He reiterated that the business line management continues to be accountable for identifying and managing its risks, but that the new deployed teams will provide “assurance champions”. So far, around 360 individuals are in place and Bly expects to build a team of around 800 in total.
During his presentation, Looney – executive vice president for the upstream Developments division - highlighted some of the work currently taking place in his business, including an enhanced strategic framework for managing risk. “The most important thing is prevention,” he told the audience. This includes the creation of the new global wells organisation and delivery of the recommendations of the report authored by Bly into the Deepwater Horizon accident. However, despite the continued work being done on prevention, the business also recognizes the need to strengthen planning for a spill should one occur so other aspects of the framework detail how BP would respond and include containment and isolation, relief wells and crisis management.
“BP has standards for prevention, but we will be reviewing and improving these,” he said. “We are creating enhanced standards for the rest of the framework. We are continuing to build our capability, building capping stacks and associated tooling that would be globally mobile and we’re capturing and sharing the lessons learned from the Gulf of Mexico.”
“BP has standards for prevention, but we will be reviewing and improving these,” he said. “We are creating enhanced standards for the rest of the framework. We are continuing to build our capability, building capping stacks and associated tooling that would be globally mobile and we’re capturing and sharing the lessons learned from the Gulf of Mexico.”
At the core of BP’s prevention effort is a seven-point agenda covering the following areas: standards, including OMS; compliance; risk; capability; contractor management; redefining performance; and technology. A major programme of work has already begun across each of these points, with Looney highlighting several examples around the world where action has already been taken. This includes shutting down a rig in Trinidad because it did not meet BP’s updated standards. BP has also not drilled a deepwater exploration well since the incident. “And we won’t until we believe we’re ready,” Looney said. He explained that BP is planning to build a Global Wells Institute, much like its Operations Academy, for teaching and assessing well site leaders.
Looney also spoke about the importance of self-verification, or as he described it “how does one really know that our operations are safe and what are we doing to mitigate any risk?” To help answer that question, the executive vice president has already visited 18 rig sites.
Looney also spoke about the importance of self-verification, or as he described it “how does one really know that our operations are safe and what are we doing to mitigate any risk?” To help answer that question, the executive vice president has already visited 18 rig sites.
Turning to the Bly Report, Looney explained that in order to deliver the 26 recommendations, more than 200 actions must occur in Developments, nearly half of which relate to blowout preventers (BOP). Designing new BOPs will take time, but in the meantime, he said, “we have issued interim guidance on what we expect and how we expect to test them. Every time a BOP is brought to the surface between wells we will have an independent third party inspection and we have put in place local plans to enhance a remotely operated vehicle’s ability to intervene on a BOP.
Both speakers made it clear to their audience that success depends on engagement right throughout the organisation – which includes referring issues up the line when necessary. “I can think of three or four things where Bernard and I have been directly involved since S&OR was formally set up,” said Bly. “The aim is to accelerate questions about operational risk up the line and ensure that our most senior people are involved in the biggest decisions.”
Both speakers made it clear to their audience that success depends on engagement right throughout the organisation – which includes referring issues up the line when necessary. “I can think of three or four things where Bernard and I have been directly involved since S&OR was formally set up,” said Bly. “The aim is to accelerate questions about operational risk up the line and ensure that our most senior people are involved in the biggest decisions.”
Looney, meanwhile, highlighted some of the ways in which his team now interacts with S&OR. “We cannot move forward in many areas without approval from Mark’s organisation. We cannot deviate from a standard until Mark’s organisation says that we can.”
Overall the meetings were welcomed by investors, with many commenting on the amount of detail that was shared with them, including the projected timings for delivering the Bly Report recommendations. Some still have questions about how BP will continue to change and BP has committed to continue meeting with this group twice a year.
Overall the meetings were welcomed by investors, with many commenting on the amount of detail that was shared with them, including the projected timings for delivering the Bly Report recommendations. Some still have questions about how BP will continue to change and BP has committed to continue meeting with this group twice a year.
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