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CSBMeetingCSBMeeting

Leadingand

Leading

and

Lagg ngIn catorLagg ngIn catorMetricsMetrics

Ho usto n , TX July 23, 2012Ho usto n , TX July 23, 2012

CSBsRequestCSBsRequest

TheUSWandAPIwereidentifiedina

ANSIbasedstandardtoidentifyleadingandlaggingindicatorsforuseintherefineryandpetrochemicalindustries

publicreportingaswellasuseatindividualfacilities

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CSBsRequestCSBsRequest

Committeebeopen,balanced,usedueprocess

Diverserepresentativesfromindustry,labor,government,publicinterest,environmental,expertsandscientificorganizationsand

3

ABetter

Process

and

OutcomeA

Better

Process

and

Outcome

1. USWviewofhowtheprocessdidnotfunction

2. ThecurrentRPfailedtomeettheCSBrecommendations andmoreimportantly itwillnotmakeameaningfulimpactontheindustry

.

improvements,changesneedtobemadeinbothmeasuringandreporting

4. Proposalsformovingforward

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Consensus?Consensus?

onsensusnee s o eamong es a e o ersidentifiedbytheCSB(industry,labor,government,publicinterest,environmental)

Arepresentativestakeholderprocesswouldprec u e n ustry romcons stent y om nat ng

and

outvoting

other

stakeholders

a

strange

notionofconsensus

5

Consensus?Consensus?

doesnotwork,especiallywhenmeetingsareconsistentlydominatedbyindustry

Nostakeholdersshouldbeallowedtogamethe

representativesatthetable

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UnlikelytoMakeanImpactUnlikelytoMakeanImpact

Withthelimitingdefinitionsadopted,Tier1and2indicatorsareforlowprobabilityevents

Statisticalvaliditywillbedifficulttoachieveexceptatthecorporateorindustrylevels andmaybenoteventhere

Thiswasbydesign

Therewillbeverylimitedreporting

Tothepublicandemployees

os espec crepor ng

Insum,

Tier

1and

2indicators

and

their

reporting

will

be

insufficienttodriveneededchange

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LimitedPublic

ReportingLimited

Public

Reporting

Tier3and4leavetoomuchdefinitiontothe

Nopublicreporting Nodriverforchange

Summarydatamaybeoflittlevalue,evento

employees

Companieswilldeterminereportingmethod

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LossofPrimaryContainmentLossofPrimaryContainment

Committeemajorityclassifiedreleasetoeffluent

functionedasdesigned

Unionminorityarguedtomovetheseeventstoapublicallyreportablelevel highertier

These

systems

are

the

last

line

of

defense

and

requiremultiplesystemfailurespriortoactivation

9

TransparencyTransparency

Moreconcernwiththeperceptionofcompany

Expressedconcernthatthegeneralpublicwasnotknowledgeableenoughtousethistypeofinformation

EarlydraftlanguagestatedTransparencycanbecounterproductiveatnationallevel(name&shame)andahindrancetoparticipation

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(Non)ReportingExamples(Non)ReportingExamples

Achargepumpmotorfailedcausingamotorfire.

estimatefromthefireisgreaterthanthe$25,000thresholdforTier1,buttherewasnohydrocarbonreleased,noLOPC,thereforetheincidentinnotAPIreportable. Costofnewmotoraloneisover$200,000

.ofhydrocarbon,(butane,isobutane andpentane)

over24

hours,

doesnt

meet

the

one

hour

release

criteria,notreportable

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LOPCNon

ReportableLOPC

Non

Reportable

April/May2010releaseBPTexasCityrefinery

40daysofflaring513,793poundsofhydrocarbons

Material routed to an effluent destruction device(flare)

and

didnt

result

in:

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LOPCNonReportableLOPCNonReportable

1. liquidcarryoverordischargetoapotentiallyunsafelocation

2. Noonsiteshelterinplaceissued,nopublicprotectivemeasurestaken

3. Noregulatoryexposurelimitsexceededatanytimeduringtheflaring.

Thoughsomethingwentwrong,thisevent

wouldnot

qualify

as

aTier

1or

2event

and

wouldnotbereportable.

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EffectiveRegulationEffectiveRegulation

QuotefromtheGulfOilDisasterandtheFutureof

BasedonthisCommissionsmultiplemeetingsanddiscussionswithleadingmembersoftheoilandgasindustry,however,itisclearthatAPIsabilit to serve as a reliable standardsetter fordrilling

safety

is

compromised

by

its

role

as

the

industrysprincipallobbyistandpublicpolicyadvocate.

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StepsGoingForwardStepsGoingForward

Setupamultidisciplinegroupconsistingofindustry,labor,OSHAandEPAtodevelopn cators

Addenvironmentalandcommunitygroupstohelpwithreporting

UseOSHAasthefocal oint

Makemeetings

accessible

to

all

who

want

to

participate

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StepsGoing

ForwardSteps

Going

Forward

Setupaseparategovernmentalregulating

Developarulemakingprocesstosetstandardized,uniform,enforceableregulations

nvo ve

n ustry

a oran

regu ators

n

developingtheagencyandrules

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