Environmental Management Project: SALAMA Offshore Oil Drilling Company - Case Study Example

SALAMA Offshore Oil Drilling Company SALAMA Company is an offshore oil drilling company. This company always comes into direct contact with water since its operations takes place under the ocean floor. The water that is extracted with oil will need separation and it is necessary to ensure that it’s free from chemicals and oils before it is returned to the ocean. The process of drilling needs to be monitored since any effects will be felt by the marine life and the surrounding environment that includes damaging consequences in fisheries, health of workers, food chain, and ecosystem balance. The challenge for this company is to find ways to reduce environmental impact and at the same time maintaining the economic importance of the company. This requires involvement of all the stakeholders concerned in the operation of this company. These stakeholders include the surrounding environment and the entire marine ecosystem, the company workers, environmental management authorities, government and all the companies that use the products of this company (OSPAR, 2002). In order to reduce environmental impacts and to achieve environmental compliance, the company will have to address its environmental performance through establishment of environmental management systems and policies. This includes; Environmental impacts assessment This will involve addressing and evaluating the environmental effects associated with the operations of the company. This include assessment of health hazards associated with workers, discharge of untreated drainage, drilling wastes, noise, decommissioning of platforms and submerged pipelines, oil or chemical spills and their effects on receiving bodies. Environmental management plan This will assist the company to develop a comprehensive strategy for the management of the environment. These strategies will provide guidelines within the management to implement the policies set by the organization on environmental management. Environmental accounting This will put into account the magnitude of environmental costs which are often ignored and provide a link between accountants and environmental managers towards improvement of financial and environmental performance of this company. These costs include cost of direct materials and equipment depreciation, costs incurred during the cleaning up of the site and storage and disposal costs. Environmental Monitoring This will enable the management to assess continually the impacts of the company to the environment and action on the reduction of the impacts. It will involve monitoring of the design, training of staff on environmental sampling and monitoring procedures on water quality, compliance and environmental health. Environmental control procedures, methods and programs for handling the environmental hazards in the company Identification of hazards Oil accidents include oil spills and blowouts which causes severe consequences such as deaths in marine life. Common causes are personnel mistakes, failure of equipment and natural impacts that are extreme such as hurricanes and seismic activities. Drilling accidents are caused by unexpected blowouts of gaseous hydrocarbons and liquids after encountering an abnormally high pressure zones during operations. The environmental hazards is causing of chronic impacts on the marine environment. Transportation and storage accidents are caused by tankers and pipelines leading to oil spills, fires and explosions. This will cause lethal impact to the marine organism over a very large area (Stanislav Patin, n.d). Health hazards Physical hazards expected during the operation are as a result of noise, radiations, vibrations and thermal extremes. Biological hazards will affect the marine environment and include food poisoning. Chemical hazards associated will this company are corrosion, toxicity, substances causing irritation and also carcinogens. Other hazards are psychosocial and are associated with work such as overloading or being away from home and they result to psychosocial stress (Ann, 2003). A Checklist for offshore oil drilling: NB – If there is a YES answer you need to describe how you will mitigate any issue concerning checked item. All the programs on seismic must be forwarded to the concerned regional office. Company Name and Address _____________ Project Type ____________________________________ 1) Did your report data conservation Centre check any reports on the “species that are of exceptional concern”? YES. NO 2) Did your assessment on pre-site assessment identify any of the exceptional of concern in the project area? YES. NO 3) Will your project lead to surface disturbance of any water body or 90 m of any fish bearing or potentially fish bearing water body? YES. NO 4) Will your project require crossing of any water body, other than by directional drilling which begins and ends beyond the buffers? YES. NO 5) Will any of your programs on waste management produce wastes which will not be disposed at a facility which is approved? YES. NO 6) Does this project require the use surface water for the injection of steam? YES. NO 7) Will this project involve the release of test water that is hydrostatic? YES. NO REMINDER: in all the projects where YES box will be is checked they MUST be reported to the coordinator of Oil & Gas in the region together with the information on above description. After that you will be required to wait for clearance before any proceedings. Individual’s name completing the checklist ________________________________ Date Position with the company _________________________________ Signature____________________________ Prevention and control measures of oil spill Oil spills are potential environmental issues associated with this industry. The control and prevention measures of oil spills include; Conduction of risk assessment of spill for facilities that are offshore and the vessels that support them. To reduce the risks of major uncontained spills, there should be a design of process, drilling systems and utility. There will be installation of valve especially the shutdown valve in subsea to enable isolation and an early shut down in case of emergency. There will be installation of corrosion prevention and control systems in all the tanks, pipelines and process equipment to get rid of unexpected leakages. There will programs for monitoring and maintenance to make sure that there is integrity in all the field equipment. Installation of system for detection of leaks to make sure there is rapid detection of loss in the containment. There will be adequate training of personnel in responding, prevention and containment of oil spill (IFC, 2007). Marine noise will be very common due to activities such as drilling, seismic operations, construction activities and marine traffic. Measures for reduction of noise impact to marine species will include; Identification of areas which are sensitive to marine life such as spawning, breeding, calving and feeding areas. A detailed planning of construction and seismic activities to keep away from sensitive times of the year in marine life. Procedures such as slow building or soft-start should be applied in marine mammal activity areas such as gradual increase of pressure from low to full levels of operation. Documenting methods for lowest practicable levels of power and also methods for reduction of unnecessary noises of high frequencies (McCauley et al. 2000) Fire explosions will be susceptible to this industry since the materials used are flammable. Prevention and control measures that are appropriate for fire and explosion will include; There should be a passive protection of fire to prevent rapid spreading of fire throughout the facility in case of an accident. This includes installation of blast-rated walls with consideration of safe and living areas. Location of all fire systems in facilities’ safe areas with protection by fire walls. Avoidance of explosive atmospheres in areas that are confined by creating inert spaces. There should be a combination of manual and automatic systems of fire alarm in all the facilities and should be located where there can be an effective and rapid response. There will be training on fire on fire safety and response as a part of implementation of health and safety workforce (OLF, 2004). Environmental Monitoring Programs for monitoring of environment will be implemented in such a way that it will address all the activities which through identification have significant impacts that are potential to the environment. The activities on environmental monitoring will be on the grounds of direct and also indirect indicators of effluents, emissions and use of resources applicable to this company. There will be sufficient frequency of monitoring in order to come up with data that is representative for the monitored parameter. The process of monitoring will be conducted by individual who are trained and follow procedures of monitoring and record keeping. The data obtained from monitoring will be analyzed at regular intervals then it will be compared by the standards of operation in order to take any corrective action. Working environment will also be monitored to assess the occupational hazards related to this company. The design and implementation of monitoring should be endorsed by professionals to be a part of program for occupational health and safety monitoring. The facilities will conform to occupational accidents and diseases record and dangerous accidents and occurrences (IFC 2007). Procedures to use in implementation of environmental accounting Developing support from the management I will first develop rapport with the employees to ensure that the management is in support of environmental accounting. To define the boundaries of the system that is proposed. I will clearly give the scope of the costs that need to be considered. For instance, I will be concerned in conventional costs such as costs of equipment and related depreciation, cost of direct materials and labor. Ascertaining the environmental impacts that are significant to the company. I will need to refer to materials supporting the management system that is existing, ensure that there is involvement of management team, and determine if the money value can be put in the impacts. To determine how the environmental impacts are accounted for and if at all there are accounted. I will be required to identify cost that are recorded on each impact and identify the waste-stream that looks significant enough for an additional reviewing. Defining the environmental costs This will help to minimize any doubt which may rise from any stakeholders. Determining those to consider in the review team I will need to combine experts who understand the existing system of accounting, understands the environmental management and the opportunities it can provide to the company an individual who understands the environmental cost being generated and activities investigated. Review of the existing systems of accounting. I will to determine how the present environmental costs are accounted for and how the costs are attributed to the products, then listing the costs to be analyzed and the current bases of allocation that are employed. Identification of environmental cost cutting opportunities which are ignored currently I will need to identify where the improvements can be made and determine the waste generated is as a result of acquiring of inferior material during the drilling operation. Suggesting of the changes to the existing systems of accounting I will document the changes so that the implications of the changes made will be considered. I will also advise users about the change system and the reason for the changes (EPA, 2003) Controlling of crude oil prices In many cases, government may be in control of property rights hence having the authority to control the prices of crude oil. Certain natural impacts such as hurricanes and seismic waves may cause destruction of facilities for drilling operations. This would in turn increase the expenses incurred in production of oil. To cater for these expenses the company will be required to increase the cost of production that is reflected by an increase in the prices of crude oil. This may be rejected by the government in with the aim of preventing increase in consumer products. To cater for this problem, oil agreements will be documented to establish the price of the resource in of taxes, royalties and other payments that the company will have to make as an investor over the project designed life. Security The issue of security in oil producing company may be threatened due to the scarcity of petroleum products. The insecurity can lead to theft of extracted oil, the company facilities and threat to workers. Lack of security due to reluctance of government officials or collaboration of security personnel in plans of theft may reduce the productivity of the company. The issue of security in oil products can be solved by coming up with laws that integrate security from different nations to safeguard the resources in an unbiased manner. Management Political interests of government officials may interfere with the management of the company in order to make adjustments that with favor their interests in the company. This may be done by a way of planning to fight the management on the grounds of environmental pollution to pave way for new management. This issue can be solved by proper documentation of all the material for used to ascertain environmental compliance and involving the relevant authorities on environmental management in processes of environmental monitoring. Provision of energy Availability of energy in this company is essential since every operation in this company requires a source of energy. Plans of regulating the energy through rationing and changes in prices by concerned departments in the government may adversely affect the production. To ensure there is a constant and affordable source of energy in the company, there is a need to advocate for independent supply of power to the company and to provision of backup generators for effective production. The challenges in ensuring that this company’s personnel follow the regulations on environment are ignorance to company policies and guidelines, remoteness of the company, high risks potential of the working environment and personnel qualification in fields of working. Ignorance of some guidelines for implementation of environmental laws may lead to failure of the entire process such as assuming that some data collected weekly show some consistency. Assumption that the data is the same in this case may lead to pollution without noticing. Being in the ocean makes the company so remote employees will feel that there may be no inspection by the authorities which will make them less concerned with environmental issues. High potential to risks given that this company is in the water will make the employees be more concerned with their safety and sidelining other impact that may affect the surrounding environment such as water treatment and discharge of chemicals to the ocean. Finally, the employees may not have enough knowledge and skills in assessment and monitoring of the environmental impacts. This will make the implementation of the environmental regulations difficult for the company (Ponsonby et al. 2011). Ethical and professional dilemmas of an environmental professional that is responsible include; Making clarifications of the issues such as prevention of waste discharge to wetland and clarifying your goals in achievement of this issue. Making considerations of the consequences such as erecting a five star hotel in a water body. Developing options in a case of building of an industry in a residential area. As an environmental professional you should be able to choose your response in compromising conditions such evacuation of a population to pave way for development (Lyons, 2002). References Ann (2003). Overview and Characteristics of Some Occupational Exposures and Health Risks on Offshore Oil and Gas Installations, Volume47, Issue3 , Pp. 201-210. Retrieved from: file:///C:/Users/kevin/Desktop/emp/hazards.htm EPA (2003). Environmental Management Accounting; An introduction and case studies for Australia. Institute of Chartered Accountants in Australia IFC (2007). Environmental, Health, and Safety Guidelines; Offshore Oil and Gas Development Lyons,C. E. (2002). Doing The Right Thing Ethics For Environmental Professionals. Air & Waste Management Association, East and West Michigan Chapters East Lansing McCauley, R.D., J. Fewtrell, A.J. Duncan, C. Jenner, M-N. Jenner, J.D., Penrose, R.I.T. Prince, A. Adhitya, J. Murdoch, & K. McCabe (2000)“Marine Seismic Surveys. A Study of Environmental Implications.” APPEA Journal 20: 692–707. OSPAR (2002). Guidelines for the Consideration of the Best Environmental Option for the Management of OPF-Contaminated Cuttings Residue. Reference number: 2002-8. OSPAR. OLF (2004). Recommended Guidelines for Waste Management in the Offshore Industry. Norway: OLF. Stanislav Patin (n.d). Accidents during the offshore oil and gas development. Retrieved from; file:///C:/Users/kevin/Desktop/emp/env%20impacts%20of%20offshore%20drilling.htm Ponsonby, W., Frano Mika & Greg Irons (2011) Offshore industry: medical emergency response in the offshore oil and gas industry Retrieved from: http://occmed.oxfordjournals.org/content/59/5/298.abstract Read More