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Overview Charlie Williams – ShellAPI Summer Standardization Conference28 June 2011

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“Industry must establish its own self-policing mechanism to increase safety in the industry” – Presidential Oil Spill Commission – January 2011

• API Executive Committee & Board Approval March 2011• Membership open to all companies (operators & contractors) that work in

deepwater (1000 ft or more)• Organized within API to leverage resources & capabilities of GIS &

Standards groups • Features aligned with recommendations of Presidential Commission • Located in Houston, Texas• Start-up 3rd quarter 2011

Overview – COS (Center for Offshore Safety)

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Benchmarking

• Step Change in Safety - UK-based partnership

• Responsible Care® - chemical industry’s global initiative

• INPO (Institute of Nuclear Power Operations) mission to promote highest levels of safety & reliability & excellence – in operation of nuclear power plants

• OSHA Voluntary Protection Program (VPP), Government sponsored partnership with businesses - promotes excellence in occupational safety & health

• Safety Case Regime - regulatory based safety initiative in a number of countries.

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Center for Offshore Safety

Our Mission...Promote the highest level of safety for offshore

drilling, completions, & operations by effective

leadership, communication, teamwork, utilization

of disciplined safety management systems &

independent third-party auditing & certification.

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Our Objectives...Achieve operational excellence by:

• Enhancing & continuously improving industry's safety performance

• Demonstrating that the public can have confidence & trust in

the oil & gas industry safety mgt programs

• Increasing public awareness of industry's safety mgt & performance

• Stimulating industry cooperation by sharing best practices & learning from each other regarding safety

• Provide a platform for collaboration between industry, the government, & other stakeholders

Center for Offshore Safety

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COS Key Operating Features

• Full Industry Participation

• Stakeholder Engagement

• Independent Auditing & Program Validation

• Information Sharing

• Continuous Improvement in Safety Mgt

• Operational Excellence in Safety Mgt

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COS responsibilities:• Providing expert assistance to member companies,• Certification of third party auditors & member audits to RP75

complementary with government regulations

• Compiling & analyzing key industry safety metrics• COS sponsored functions to facilitate sharing & learning

• Identifying & promoting opportunities for industry to continuously improve

• Working with Industry leaders to assure improvement opportunities & deficiencies are addressed promptly

• Communicating & working with government & other stakeholders

Center for Offshore Safety

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COS – Auditing • API RP 75 Recommended Practice for Development

of a Safety and Environmental Management Program for Offshore Operations and Facilities - std to measure performance via third-party auditing & certification.

• Audits will include BOEMRE’s requirements for SEMS per “Workplace Safety Rule”

• Audit checklists developed & pilot audits underway • “Audit Guidance” document being drafted

– Provide analysis on use of checklist– Guidance on conducting API RP 75 audits

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Membership in the Center for Offshore Safety...

Membership is mandatory for API members

Membership is encouraged for non-API companies including contractors

Members will be expected to actively participate in programs & activities, & to maintain a high level of safety performance supported by COS and share “blind” audit results, best practices, & safety statistics

The COS's objective is to be supportive & help all industry achieve high levels of safety

Center for Offshore Safety

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Center for Offshore Safety

API GIS Committee API Upstream Committee

API Executive Committee

External Advisory Group

• Government entities• Academia reps• Others as appropriate

Independent3rd Party Auditors

Center for Offshore SafetyGoverning Board

Up to 17 members

• Chairman (API-member company rep)• Producing/Operating companies (6 max)• Drilling Contractor companies (3 max)• Service & Supply companies (3 max)• Industry Association representatives (3

max)• COS Executive Director

Center forOffshore Safety

• Executive Director• Technical Support and Administrative

Staff• 3rd party auditor certification program• API Global Industry Services operations

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COS Governing Board

• 13 to 17 Members

• Chair (API-member 3-yr term)

- from API Upstream Committee

- approved by API Executive Committee

• 5 to 6 Producing/Operating companies (2-yr terms)

• 2 to 3 Drilling Contractor companies (2-yr terms)

• 2 to 3 Service & Supply companies (2-yr terms)

• 2 to 3 Industry Association representatives (2-yr terms)

• COS Executive Director

Center for Offshore Safety

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COS Staff Requirements

• Hire Executive Director• Build on existing API staff capabilities

– Legal– Finance– Information Systems & Data Management– Certification & Licensing

• Use 4-5 seconded mid-career company staff to expedite COS development & implementation (first 6 months)– Outreach/Education to industry, government, & public– Practical SEMS implementation & operation expertise– Best practice evaluation/development– Data analysis & report preparation– SEMS Program development

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COS ORGANIZATION CHART

Other API GIS Resources - Law - Accounting - Etc.

Industry Loaned ProfessionalsAPI Staff

COS Staff

3rd Party Consultants

3rd Party Auditors

Draft(August, 2011)

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COS ORGANIZATION CHART

Other API GIS Resources - Law - Accounting - Etc. Industry Loaned Professionals

API Staff

COS Staff

3rd Party Consultants

3rd Party Auditors

*Deputy Director position dependent on outcome of 18 month organizational structure analysis.

Draft(24 Months)

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COS Roll Out Timeline

• June 2 – Industry Outreach Meeting• June 17 – Nominations for Board Chair, Board

Members, Seconded Employees• July 15 – Select Board Chair & Board Members• July 18 – Select Seconded Employees• August 1 – Hire/Seconded Exec Director• August 1 – COS Startup• August 15 – First COS Governing Board Meeting

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BOD Orientation

CEO Commit

Third PartyAuditor

AccreditationMembership

% Target

COS Conference

Upstream Comm Review

20122011

Industry Outreach Meeting COS BOD

Initial Board Meeting

Strategic Plan (1-3yr)

Performance Metrics

Exec Comm ReviewMember

Orientation Session

COS Transition Milestones

April May June July August Sept. Oct. Nov. Dec. Jan. Feb. March April May

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Questions

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Our Guiding Principles...

1. Industry leaders will demonstrate a visible commitment to safety,

2. Operators, contractors, and suppliers will work together to create a pervasive culture of safety,

3. Decision making at all levels will not compromise safety,

4. Safety processes, equipment, training, and technology will undergo constant examination and improvement,

Center for Offshore Safety

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Our Guiding Principles (continued)...

5. Members will share learnings and embrace API Standards, and best practices, to promote continual improvement,

6. Open communication and transparency of safety information will be utilized to build mutual trust among stakeholders and promote collective improvement in industry performance,

7. Collaborative approaches will be utilized to drive safe and responsible operations,

8. Everyone will be personally responsible for safety and empowered to take action.

Center for Offshore Safety

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