Article by Angela Macdonald-Smith published by The Sydney Morning Herald: 8 May 2015
WA inquiry shines spotlight on floating LNG safety fears
Royal Dutch Shell and Woodside Petroleum have insisted that workers to be stationed on vast floating liquefied natural gas plants far off the Western Australian coast will be safe despite serious concerns having been raised in a parliamentary inquiry that they won’t be evacuated even for severe tropical cyclones.
A WA parliamentary committee examining the safety of floating LNG highlighted fears that workers would be thrown around within their accommodation modules during cyclones and could experience psychological stress at being unable to leave the vessel.
An Australian Manufacturing Workers’ Union official told the inquiry that he couldn’t envisage having to remain on a vessel “a number of hundreds of kilometres away from anywhere that is remotely safe and secure” and having to put his faith in the hope that “they got it right” on the safety design.
Shell is developing Australia’s first floating LNG plant, at the $US12 billion ($15 billion) Prelude project in the Browse Basin, which is due to begin production in 2016-17. The huge vessel used at the project will be permanently moored over the field, with up to 340 personnel to stay in cyclone-proof accommodation during extreme storms. Woodside plans to use a similar vessel for its Browse floating LNG project, on which it is targeting a final go-ahead in 2016.
The plan for the FLNG vessels during cyclones differs to current practices for offshore oil operations in Australia, where workers are evacuated to safety onshore ahead of storms and production ships disconnect from fields to sail to calmer waters.
Shell and Woodside both stood by their plans on Friday.
“Safety remains the primary focus of Shell’s FLNG technology,” a spokeswoman in Perth said.
“Multiple formal safety assessments confirm an FLNG facility is equally as safe and reliable as other modern offshore production facilities currently in operation.”
Shell’s Prelude vessel, being built in South Korea, has been designed to withstand a one-in-10,000 year storm.
A Woodside spokeswoman said the company “has a comprehensive management system that provides assurance that appropriate health, safety and environmental controls are in place for all our assets, particularly in relation to extreme weather events”.
The inquiry by the Economics and Industry Standing Committee, comprising five MPs, follows an early inquiry into the economic impact of floating LNG, which is expected to be increasingly used in WA instead of hugely expensive new onshore plants. That inquiry found the use of the technology would cost the state jobs and investment.
In the safety inquiry, the companies insisted that keeping personnel on board was safer than exposing them to the risk of helicopter transfers during an evacuation. But the committee pointed to the need for all aspects of health and safety, including the mental health of workers, to be included in safety assessments and formally assessed by the regulator.
Committee chairman Ian Blayney also pointed to concerns about the cramped working environment compared to an onshore plant, and the adequacy of emergency evacuation infrastructure and procedures.
In his foreword on the report, Mr Blayney said the committee couldn’t answer the key question of whether floating LNG was safe. But he said the committee had learnt of the “considerable efforts” made by Shell to reduce risks at its Prelude FLNG vessel.
Ultimately, it is up to the offshore petroleum industry regulator, NOPSEMA (the National Offshore Petroleum Safety and Environmental Management Authority), to assess the information provided by Shell “and determine whether risks are, in fact, ‘as low as reasonable practicable’,” Mr Blayney said.
Despite the doubts raised in the course of the inquiry, former Labor state resources minister Fran Logan, who sat on the committee, acknowledged that Shell “has clearly thought through risks to protect all lives on board”.
Shane Love, another committee member, said he was “confident of Shell’s expertise and [safety] culture will deliver as good a result as humanly possible”.
The committee recommended that the WA government encourage the federal government and Shell to carry out an emergency response exercise on Prelude as soon as possible after it starts production. It wants the Council of Australian Governments to examine the need for a lead agency to co-ordinate necessary safety infrastructure and to examine the need for increased transparency from NOPSEMA on emergency response planning.
It also wants COAG to discuss the need for a regional plan for offshore emergency response that takes into account the possibility of requiring emergency response at several FLNG vessels at once.