New Approaches For Gas And Oil Industry Explorations
IIED International Institute for Environment and Development
released a report that shows how growing risks associated
with oil and gas exploration
can be cut with a new approach to the way the sector manages its chains of contractors.
The report, which draws on three years of research and interviews within the sector, outlines seven key areas for action relating to the industry’s systems, procedures and – importantly – its culture. It highlights the key challenge of maintaining high environmental and social performance standards, even when speed and low cost of delivery are priorities.
Risks in the sector are increasing for two reasons. First, the industry is moving into ever more sensitive environments – whether in deep waters, the Arctic or the Amazon and Congo basins — and these bring greater technological, political and social risks.
Second, oil and gas exploration involves an increasingly complex chain of contractors and subcontractors – failure to manage these adequately increases the industry’s vulnerability to catastrophic accidents.
The report identifies three broad sets of factors that hamper effective chain-wide performance:
• Lack of a sense of shared responsibility throughout the contracting chain and across stakeholder groups
• Inadequate implementation of systems and procedures to enforce standards and incentivise good performance
• Cultural and contextual challenges in widely differing regions of the world
This report was co-funded by the Swedish International Development Agency (SIDA), the UK Department for International Development (DFID) and the Norwegian Agency for Development Co-operation (NORAD).