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Shell International Exploration and Production B.V.
EP HSE Strategy and Policy Implementation Guide
EP 95-0140
HSE MANUAL Revision 0: 12 December 1997
EP HSE Manual Amendment Record Sheet Section Number: EP 95-0140 Section Title: EP HSE Strategy and Policy Implementation Guide
Rev. No. 0
Chapter Nos. All
Description of amendment
Date dd/mm/yy
Original hard copy and CD-ROM issue
Oct 98
Amended by EPS-HE
Contents
CONTENTS
3.6.5 Workplace Hazard Management
36
Audit
38
3.7.1 Internal Audits
38
3.7.2 External Audits
38
3.8
Management Review
40
4
The HSE Assurance Process
4.1
3.7
Summary
1
1
Introduction
3
1.1
HSE Policy Review
3
1.2
Purpose and Structure of the Guide
3
The Internal Assurance Process
42
2
The New Approach to HSE
5
4.1.1 The HSE MS
42
2.1
Key Documents
5
4.1.2 SIEP-led HSE Audits
42
2.1.1 Group Level Documents
5
4.1.3 HSE Letter and Self-Assessment Checklist
42
2.1.2 EP Business Documents
7
The External Assurance Process
44
2.2
Key Changes
7
4.2.1 External Reporting
44
3
Implementation Through the Health, Safety and Environment Management System
4.2.2 Certification and Verification
45
9
3.1
Leadership and Commitment
10
3.2
Policy and Strategic Objectives
12
3.2.1 HSE Policy
12
3.2.2 Strategic Objectives
13
3.2.3 Commitment to Sustainable Development
15
Organisation, Responsibilities, Resources, Standards and Documents
18
3.3.1 Organisation, Responsibilities and Resources
18
3.3.2 Contractors
19
3.3.3 Communication
20
3.3.4 Documentation
21
Hazards and Effects Management Process
23
3.4.1 General
23
3.4.2 Environmental Assessment (EA)
23
3.4.3 Health
24
3.4.4 Ergonomics
27
3.4.5 Product Stewardship and Life Cycle Assessment
27
3.4.6 Soil and Groundwater Contamination
28
3.4.7 HSE Assessments for Acquisition, Divestment, Abandonment or Mergers
28
3.5
Planning and Procedures
31
3.6
Implementation and Monitoring
32
3.6.1 Target Setting
34
3.6.2 Monitoring HSE Performance
35
3.6.3 Reporting HSE Performance
35
3.6.4 Incident Monitoring, Reporting and Investigation
35
3.3
3.4
EP 95-0140 Revision 0 12 December 1997
4.2
41
Appendices I
Royal Dutch/Shell Group Procedure for an HSE Management System
49
Comparison of the Requirements for ISO 14001 and the EP HSE MS Guidelines (EP 95-0100)
51
Procedure for Reporting and Review of Incidents with a Significant Impact
63
IV
Illustrative HSE Letter
65
V
SIEP HSE MS Self-Assessment Checklist
69
II
III
Glossary of Abbreviations
83
References
85
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EP 95-0140 Revision 0 12 December 1997
Summary
SUMMARY A far-reaching review of the Group's values, principles and policies was undertaken following the negative publicity surrounding Nigeria and Brent Spar. Amongst the outcomes, the review resulted in an update of both the Statement of General Business Principles and the Health, Safety and Environment (HSE) Policy, the introduction of a new Procedure for an HSE Management System (HSE MS), and consequently a fundamental change in the approach to HSE by the Group. The EP Business has also continued to strengthen its commitment to HSE and in 1996, published its first external HSE Report which included HSE objectives and targets against which future performance will be publicly reported. The new approach to HSE demonstrates a significant change in overall direction and focus. It is set out in a number of documents at both the Group and EP Business level. This document has been prepared to consolidate these new requirements into one HSE strategy document to enable senior management and HSE specialists, both within SIEP and EP companies, to more fully understand the new policy requirements. The work will be integrated into the next version of the HSE MS Manual. The guide outlines the key changes in the focus and direction of the new HSE strategy. These include an increased emphasis on consultation and communication, a new commitment to sustainable development and a new emphasis on public accountability and external verification of performance, including a requirement for Group companies to set up their HSE MS in such a way as that it can be externally certified against an international systems standard such as ISO 14001. There are also significant changes at the implementation level. Key implications include the requirement to set improvement targets for all key HSE parameters against which performance should be publicly reported. There are also new detailed requirements on impact assessments, including environmental assessments for all new projects and major modifications, health assessments ergonomics, soil and groundwater assessments and HSE assessments as part of any proposal for acquisition, divestment, abandonment or merger of business entities. The key challenge for the EP Business is now to ensure that the new requirements are fully understood and implemented in practice. To help achieve this, the guide follows the structure of the EP HSE MS as outlined in the EP HSE Manual (EP 95000). For each element of the HSE MS, the guide provides a summary of the key new developments and requirements, an interpretation of the measures required to implement them and a comparison of the relevant sections of ISO 14001 and the EP HSE MS for those companies seeking certification. The new approach to HSE represents a major step forward for the Group in addressing societal expectations and the weaknesses of the existing policies. To avoid the mistakes of the past and to ensure that policy and performance match, the HSE assurance process has also been strengthened. The guide outlines the assurance process that should occur both internally and externally so that the Group, individual companies, and the general public can be assured that HSE performance matches the policies that have been agreed. Internally this includes audits and the annual submission of an HSE self-assessment checklist and HSE Letter to the appropriate Business Director. Externally guidance is provided on certification, verification and public reporting.
EP 95-0140 Revision 0 12 December 1997
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EP 95-0140 Revision 0 12 December 1997
1 Introduction
1
INTRODUCTION
1.1
HSE Policy Review
In recent years, public attention and concern towards environmental and social issues has grown considerably and companies are increasingly being called to account for their environmental and social performance. The Royal Dutch/Shell Group has found itself the subject of intense scrutiny on a number of issues such as Brent Spar and Nigeria, which have exemplified the external pressure put on Group companies for greater clarity and transparency in terms of corporate values and principles. Following the negative publicity of Nigeria and Brent Spar, extensive consultation took place to understand the underlying root causes. The main conclusion related to two gaps; a gap in the ability of multinational companies to meet changing societal expectations and a gap between the Health, Safety and Environment (HSE) policy and actual performance. Although the Group had adopted an HSE policy since the 1960s, this was previously only a guideline which included both visionary and policy statements. It was found that this had led to varying interpretations and incomplete implementation, and consequently a gap between what the Group said it would do and what was actually done in practice. To address these issues, a far-reaching review of the Group's values, principles and policies was undertaken. This resulted in an update of both the Statement of General Business Principles (SGBP) and HSE Commitment and Policy, as well as the introduction of a new Procedure for an HSE Management System (HSE MS). The establishment of an HSE assurance process completed the changes in the approach to managing HSE by Group companies.
1.2
Purpose and Structure of the Guide
The key challenge for the EP Business is to now ensure that the new requirements and their implications are fully understood and implemented. Any future gap between policy and performance, perceived or real, will pose a significant threat to business operations and reputation. The new approach to HSE is set out in a number of documents. This document has been prepared to consolidate all the new elements necessary for full implementation of the new HSE Commitment, Policy and Procedure into one guidance document. The purpose of the guide is to: •
provide a background to the new approach to HSE and its key changes in focus and direction (Section 2);
•
provide guidance on how the specific new requirements may be implemented within the context of the existing HSE MS (Section 3);
•
outline the revised assurance process - the means by which the Group and the general public can be assured that the HSE performance matches the policies that have been published (Section 4), and
•
provide direction on where appropriate additional, detailed information may be found.
In this way, it should be clear both what the requirements of the new approach are, and how they may be implemented. The guide will be included in the next version of the HSE Manual (EP 95000). It should be noted that the guide focuses primarily on environment and health issues, as these are the areas where the most new developments and changes have been introduced.
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HSE Manual EP 95-0140 EP HSE Strategy and Policy Implementation Guide
2
THE NEW APPROACH TO HSE
This section provides a background to what the new approach to HSE is. It outlines the key documents which form the basis of the strategy and sets out the key changes in focus and direction.
2.1
Key Documents
The new requirements for HSE are set out in a series of different documents, both at Group and EP Business level, as illustrated in Figure 1 and discussed below. Along with the existing documentation published by SIEP, these documents provide the overall guidance on the future HSE practices and performance that are expected from EP companies 1 . Until now, however, these requirements had not been combined into one consolidated guide. Figure 1 - The documents shaping the HSE Strategy and Policy Implementation Guide Royal Dutch/ Shell Group
Royal Dutch/ Shell Group
Commitment to HSE and HSE Policy
Shell Business Framework July 1996
March 1997
Royal Dutch/ Shell Group
Royal Dutch/ Shell Group Statement of General Business Principles
Procedure for an HSE Management System
EP HSE STRATEGY AND POLICY IMPLEMENTATION GUIDE
March 1997
March 1997
SIEP Health, Safety & Environment Report 1996
Group HSE Guidance
The EP HSE Manual EP 95000
June 1997
2.1.1 Group Level Documents There are five key documents which shape the new approach to HSE at the Group level. These are the Shell Business Framework, the revised SGBP, the Commitment to HSE, the HSE Policy and the Procedure for a HSE Management System. Guidance on HSE at Group level is also provided in a number of "yellow guides". The Shell Business Framework outlines the overall business aspirations for the Group. It refers to sustainable development (SD), recognises that societal expectations of business are changing and that 1
4
'Companies' includes both Operating Units and Joint Ventures under operational control. Operational control means the full authority to adopt and implement the Group HSE Commitment, Policy and Procedure.
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2 The New Approach to HSE companies that fail to respond effectively are likely to decline. The SGBP sets out the general business principles that govern how each Group company should conduct its affairs and includes sections on HSE, the community and communication. It also includes a commitment to contribute towards SD. The specific requirements for HSE at the Group level are set out in the HSE Commitment and Policy (Figure 2 below) and Procedure for an HSE MS. The Commitment is a statement of the longer term aspirations to be achieved through implementation of the Policy. As such, the commitments are effectively the strategic HSE objectives for the Group. The Policy describes what every Shell company will do in its day-to-day business. Figure 2 - The Royal Dutch/ Shell Group HSE Commitment and Policy
The Royal Dutch/ Shell Group Commitment to Health, Safety and Environment In the Group we are all committed to: • • • • • • • •
pursue the goal of no harm to people protect the environment use materials and energy efficiently to provide our products and services develop energy resources, products and services consistent with these aims publicly report on our performance play a leading role in promoting best practice in our industries manage HSE matters as any other critical business activity promote a culture in which Shell employees share this commitment.
In this way we aim to have an HSE performance we can be proud of, to earn the confidence of customers, shareholders and society at large, to be a good neighbour and to contribute to sustainable development. The Royal/Dutch Shell Group Health, Safety and Environment Policy Every Shell company • • • • •
has a systematic approach to HSE management designed to ensure compliance with the law and to achieve continuous performance improvement. sets targets for improvement and measures, appraises and reports performance requires contractors to manage HSE in line with this policy requires joint ventures under its operational control to apply this policy and uses its influence to promote it in its other ventures includes HSE performance in the appraisal of all staff and rewards accordingly.
Endorsed by the Committee of Managing Directors, March 1997 The Group Procedure outlines the essential minimum components of an HSE MS. It includes a requirement for the system to be set up in such a way that it can be externally certified against an international systems standard. At present the only recognised standard for such a system is ISO 14001 against which the environmental components of an HSE MS may be certified. A full copy of the Procedure is given in Appendix I.
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HSE Manual EP 95-0140 EP HSE Strategy and Policy Implementation Guide
2.1.2 EP Business Documents There are a number of documents on HSE at the EP Business level. Of particular importance to the new approach are the EP HSE Report 1996 and the EP HSE Manual (parts of which are subsequently referred to as EP 95-xxxx). The EP HSE Report includes the EP Business' HSE objectives and targets. The environmental objectives were first published in the proceedings of the Society of Petroleum Engineers (SPE) HSE Conference in January 1994 and were outlined in 'The Test of Tomorrow' (SIPM, September 1993). They have since been updated in line with the new Commitment and Policy, and developments in legislation and international conventions. The objectives are shown in Table 1. Table 1 - EP Business HSE Objectives Issue
EP Sector Objective
1.
Health
No harm to people, whether they be employees, contractors or third parties
2.
Safety
No harm to people, whether they be employees, contractors or third parties
3.
Flaring
Reduce and ultimately eliminate continuous gas flaring
4.
Venting
Eliminate gas disposal by continuous venting
5.
Halons
Zero losses of halons
6.
Resources
Minimise use of resources - land, energy and raw materials
7.
Discharges to water
Re-inject produced waters unless their discharge is fully compatible with the surface environment
8.
Oil-based drilling muds and cuttings
Prevent the release of oil-based muds and oil-based mud cuttings to the environment.
9.
Solid wastes
Control and minimise all solid and other wastes
10.
Oil spills
Prevent oil spills
The HSE Manual already provides comprehensive guidance on HSE and particularly the EP requirements for the HSE MS. This guidance will continue to be valid and will be updated in due course to fully meet the new requirements. In addition to these documents, additional guidance on consultation and SD are under preparation by SIEP.
2.2
Key Changes
The new approach to HSE demonstrates a significant change in overall direction and focus. Key changes at the strategic level compared to the commitments made in the past include: •
an aspiration to be a leader. There is a repositioning of the Group from being amongst the leaders (previous HSE Policy Guidelines) to one whereby "we want to be recognised as leaders by our customers, partners, suppliers and competitors, and welcomed by the communities around us" (Shell Business Framework). This can only be demonstrated through leading business performance including HSE performance.
•
a new emphasis on public accountability and external verification of performance consistent with the transition from a "trust me" to a "show me" world. To demonstrate credibility in HSE management and gain public trust, there is a new requirement for Group companies to set up their HSE MS in such a way that it can be externally certified against an international systems standard such as ISO 14001. All EP companies are expected to have an HSE MS (including HSE Cases) fully implemented in line with the Group Procedure by the end
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2 The New Approach to HSE of 1999. Companies with major installations are encouraged to achieve such certification by end-2000. At the site level, where external stakeholders seek reassurance that environmental matters are being managed effectively, external certification through the European Union EcoManagement and Audit Scheme (EMAS) represents a suitable approach. •
a new emphasis on consultation and communication. Companies will need to show themselves more willing to listen, learn and interact with the world outside by strengthening relationships and fully consulting with stakeholders. To contribute towards this, the Group and individual Businesses are required to publish externally verified HSE reports from 1997 onwards. Companies are also required to have programmes in place to provide full information about their activities.
•
a new emphasis on "getting it right" at the beginning of projects by using life cycle approaches and carrying out impact assessments. The approach should be one of "anticipate and prevent" rather than "react and cure".
•
revised assurance process. One of the most significant changes is that the new Policy and Procedure is mandatory for all Group companies and joint ventures under operational control. This ensures that there is now a structured implementation of the HSE MS. In addition, Group Businesses are asked to provide assurance of Policy implementation. Chief Executives are asked to complete an HSE self-assessment checklist annually, as part of the Appraisal and Strategy Review process. They must also submit an annual HSE Letter to address compliance with the new Policy and Procedure and to describe corrective actions. The HSE Letters will be consolidated into an EP Business HSE Letter.
•
a new commitment to SD. For the first time, the Group has publicly stated its commitment to contribute towards SD, and accepts the Brundtland Commission definition of "development that meets the needs of the present without compromising the ability of future generations to meet their own needs" (see World Commission on Environment and Development, Our Common Future, Oxford University Press, 1987). The Group's current position on SD is outlined in a Management Brief (see References). A fundamental premise is that environmental, economic and social issues are three inter-dependent pillars of SD.
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HSE Manual EP 95-0140 EP HSE Strategy and Policy Implementation Guide
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IMPLEMENTATION THROUGH THE HEALTH, SAFETY AND ENVIRONMENT MANAGEMENT SYSTEM
This section provides detailed guidance on how the specific requirements of the new approach should be interpreted and implemented within the day-to-day activities of EP companies, within the context of the existing HSE MS. The section follows the structure of the EP HSE MS as outlined in the EP 95-0100. It builds upon the existing guidance already provided in EP documents, allowing companies to adapt and modify their practices to fully implement the new strategy. For each component of the HSE MS in turn, the following are provided: •
a summary of the key new developments and requirements;
•
an interpretation of the measures required for implementation of these new requirements both in SIEP and EP companies, and
•
a comparison of the relevant sections of ISO 14001 with the EP HSE MS to highlight the specific requirements of ISO to help those companies seeking to achieve certification.
ISO 14001 has been selected, as it is currently the only globally recognised environmental management systems standard. There is currently no international standard for health and/or safety management systems. Companies may use this guidance as a basis to compare their HSE MS with the ISO requirements, but are also strongly recommended to refer to the original specification (ISO 14001) and the supporting guidance (ISO 14004). Companies should also contact their appropriate national body which co-ordinates certification of environmental management systems to ensure that the HSE MS is set up such that it complies with the requirements and interpretation.
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3.1
Leadership and Commitment
Key developments and requirements •
The Group HSE MS Procedure requires that: "Management and supervision shall be regarded as being fully committed to HSE by all staff and contractors. They are to be seen as providing a leading role towards constant improvement through leadership and action planning."
•
In line with the requirements of the Group HSE Commitment, top management need to provide strong and visible leadership and commitment in order to promote a culture in which all employees share the commitment to HSE and to contribute towards SD.
•
Companies are required by the Group HSE Commitment to play a leading role in promoting best practice in the industry.
•
The revised reporting and appraisal arrangements now require the Chief Executive to send an annual HSE Letter to the relevant Business Director in SIEP.
Implementation Full details of management commitment and leadership for HSE may be found in EP 95-0100. Specific requirements to meet the new commitments are outlined below: •
Management are required to demonstrate commitment to implementing the HSE MS and achieving external certification by ensuring that the necessary costs, time and resources are allocated. Resources, milestones and reviews to ensure this target should be included in the Business Plan.
•
Management are required to demonstrate commitment towards HSE and SD and promote a culture in which all staff share this commitment. This may be demonstrated by:
•
•
allocating the necessary resources to HSE and SD matters and initiatives. It may be necessary to establish task forces to determine what SD means to the company and encourage employee participation in such initiatives and programmes;
•
ensuring that SD becomes an integral part of the business process by referencing it in Business Plans, budget proposals, mission statements, policy documents etc., and
•
promoting views on HSE and SD both within and outside the company by participating in internal initiatives, contributing to the public debate and meeting with external organisations to develop thinking.
Management are encouraged to ensure that sufficient time and resources are available to enable the EP Business to actively participate and take leadership roles in fora where best practice on HSE may be promoted. This may include internal fora either within the Group or with contractors and suppliers and external fora both specific to the EP industry and wider. SIEP will lead in promoting best practice by: -
actively participating and leading in both the committees and working groups of international fora such as the E&P Forum, the International Petroleum Industry Environmental Conservation Association (IPIECA) and the Society of Petroleum Engineers (SPE);
-
initiating and participating in international benchmarking initiatives with other companies in order to identify best practice to improve overall industry practice, and
-
making know-how in the area of HSE available to contractors and the industry.
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HSE Manual EP 95-0140 EP HSE Strategy and Policy Implementation Guide Companies can lead in promoting best practice by:
•
-
participating and where appropriate, taking leadership roles in regional and national industry trade associations;
-
participating in other appropriate organisations which shape external developments. For example, many countries have organisations or committees set up to bring business, regulators, government and NGOs together to discuss and formulate HSE and SD policy, through which industry-wide best practice and SD objectives may be promoted;
-
initiating and participating in local and national benchmarking initiatives;
-
organising workshops and other initiatives with suppliers and contractors, and
-
ensuring that contractors manage their HSE in line with the company's policy and commitments (for guidance see EP 95-0110).
Management are required to send an annual HSE Letter and a self-assessment checklist to the relevant Business Director to provide assurance that HSE Policy and Procedure are being followed and to give the status of their implementation (Section 4.1.3).
Leadership and Commitment Specific requirements of ISO 14001: Requirements should be met by EP HSE MS.
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3.2
Policy and Strategic Objectives
3.2.1 HSE Policy Key developments and requirements •
The Group HSE MS Procedure requires that: "Companies shall each have a written HSE policy, covering the Group Policy elements as a minimum."
Implementation Full details of the requirements for an HSE Policy may be found in EP 95-0100. To meet the new requirements, companies must adopt at board level, an HSE policy which is consistent with the new Group HSE Policy (Figure 2) as a minimum. A company HSE policy is therefore expected to include the following requirements: •
to have a systematic approach to HSE management designed to ensure compliance with the law and to achieve continuous performance improvement. A systematic approach is achieved through implementing an HSE MS in line with the Group Procedure. Full compliance with the law requires full compliance with national laws, regulations and standards as well as applicable international 'soft laws' (i.e. international conventions and agreements);
•
to set targets for improvement and measuring, appraising and reporting performance. See Section 3.6;
•
for contractors to manage HSE in line with this policy. See Section 3.3.2;
•
for joint ventures under its operational control, to apply this Policy and use its influence to promote it in other joint ventures. Guidance on the application of this may be found in the Information Pack, which accompanied the release of the new Group Policy in March 1997 (see References). Legal guidance should also be sought as appropriate. The Information Pack provides information on the application of the wording to: •
Group companies which own shares in another operation or corporation which is not itself a Group company. Such companies are referred to in the Information Pack as “Joint Venture Companies”, and
•
Group companies which are members of incorporated or 'contractual' joint ventures. Such ventures are referred to in the Information Pack as “JVs”.
In the case of existing joint venture companies and JVs, the intention is that Group companies should take whatever steps are available to them to promote the adoption of the HSE Policy. The objectives are for the joint venture company or JV to: •
have a published HSE Policy which is the same in all material aspects as those of the Group participant (if not better), even though it may be differently worded;
•
have an HSE Procedure similar to the Group participant’s HSE Procedure for an HSE MS, and
•
establish means by which the Group company can effectively monitor and properly assess whether the joint venture company or JV is observing its HSE Policy.
Where the Group company has operational control of a joint venture company this should present no difficulty. In other cases, the Procedure for an HSE MS requires that the "business risks that are related to HSE shall be assessed". What the Group company can do will depend on relevant articles, byelaws, constitutive documents and agreements. Shareholder agreements
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HSE Manual EP 95-0140 EP HSE Strategy and Policy Implementation Guide may, for example, contain explicit provisions requiring the company to adopt the Group company’s HSE Policy. In the case of JVs, it will depend on the provisions of the joint venture agreements. Where the Group company is not the only member of the JV, but also the operator, the joint venture agreement will, typically, empower it to apply its HSE Policy in conduct of the venture. Efforts should be made to incorporate requirements in Joint Operating Agreements. Where the Group company is not in a position to require adoption or implementation it may consider: •
using its influence to urge fellow shareholders or co-ventures to adopt the Group HSE Policy and Procedure;
•
making its support for further investment conditional upon adoption and implementation, (subject to shareholder or joint venture agreements and contractual obligations), or
•
putting forward proposals for divestment if fellow shareholders and co-venturers are unpersuaded, if divergence between policies are sufficiently significant, or if there are sufficiently serious and persistent gaps between the policy and the observance of it (subject to shareholder or joint venture agreements and contractual obligations).
In the future, the general intention is that Group companies should invest in joint venture companies or become involved in JVs only if they will operate in accordance with HSE polices which are in all material respects the same as (if not better than) those of the Group company. •
In addition to the above mandatory policy requirements, companies should also consider including issues which are locally specific in their HSE policy. Also, as stated in the 'Drugs and Alcohol Abuse Employment Guidelines' issued by SIPC (see References), companies should also develop and implement an appropriate drugs and alcohol policy.
3.2.2 Strategic Objectives Key developments and requirements •
The Group HSE MS Procedure requires that: "HSE objectives shall be challenging, understood by all and consistently incorporated in policies. In setting objectives, management shall consider the overall risk levels of its activities and shall identify those critical operations and installations which require a fully documented demonstration that risks have been reduced to as low as reasonably practicable (ALARP)."
•
The elements outlined in the Group HSE Commitment are long term aspirations and as such are essentially strategic Group HSE objectives. These have been cascaded down into EP HSE objectives as outlined in Section 2 and published in the 1996 EP HSE Report.
•
In addition, the EP Business Committee has supported a series of Minimum Environmental Expectations (MEEs) which need to be considered when setting objectives and targets. It is anticipated that a Group position will be formulated later in the year. These are shown below in Table 2.
Table 2 - Minimum Environmental Expectations for the EP Business Parameter
Practice
By
Halons/hard CFCs
Eliminate inventory
2004
Gas flaring
No continuous gas flaring in new projects. Eliminate continuous gas flaring
now 2008
Hydrocarbon emissions
No continuous hydrocarbon venting in new projects.
now
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3 Implementation through the HSE Management System Eliminate continuous hydrocarbon venting
2003
Oil in produced water