Fault Found in Fatal Oil Platform Fire
An explosion and fire during a construction project last November on a Gulf of Mexico oil production platform operated by Black Elk Energy Offshore Operations, LLC occurred after contractors failed to follow standard safety practices, a third-party investigator has concluded. The platform is located at West Delta 32 Block in the Gulf of Mexico, 17 miles south east of Grand Isle, La.
After a thorough eight-month investigation, ABSG Consulting found that, while production was shut in, workers welded on piping that was connected to a tank containing crude oil and flammable oil vapors without following Black Elk Energy’s safety practices.
A global company known in safety and risk management, ABSG was retained by Black Elk Energy to investigate the Nov. 16, 2012 incident that resulted in the deaths of three workers and injuries to others. ABSG performed an extensive investigation to determine the causes of the accident, coordinated its investigation with the U.S. Bureau of Safety and Environmental Enforcement (BSEE), and provided recommendations to prevent a similar incident in the future.
“The victims of this tragic accident last November are always in our thoughts and prayers,” said John Hoffman, Black Elk’s president and CEO. “We owe it to them and their families to understand how this accident happened. With this ABSG report, I am confident we now know the causes of this tragedy and how to prevent such an accident from ever happening again.”
ABSG found that:
·On the day of the incident, workers were welding a flange on open piping leading to an oil tank that contained flammable vapors. The piping leading to the tank had not been isolated and made safe for welding activities as required by Black Elk Energy safe work practices.
·Flammable vapors in the piping ignited and within seconds reached the first oil tank and then two connected tanks.
Black Elk Energy contracted with Grand Isle Shipyard to perform the construction work. Although Grand Isle committed in its contract to not use subcontractors on Black Elk Energy projects, all of the workers performing the welding involved in the incident were employed by DNR Offshore and Crewing Services, a subcontractor of Grand Isle.
ABSG determined that use of the DNR Offshore subcontractor without notifying Black Elk Energy was one of several causes of the incident. ABSG also determined other causes were that Grand Isle and DNR Offshore employees failed to adequately follow safe work practices for performing welding and failed to stop work when unsafe conditions existed. The workers involved in the incident were from the Philippines.
“Filipino offshore oil workers have a deserved reputation for competence and professionalism,” Hoffman said. “A serious issue in this case was Grand Isle’s apparent failure to provide proper safety training and appropriate supervision.”
In conducting its investigation, ABSG reviewed thousands of pages of documents and records; collected and preserved physical evidence from the platform; performed fire and explosion modeling of the incident; and utilized industry-accepted causal analysis methodologies to determine the causes of the incident.
“Over the past eight months we have worked to provide support for the victims and their families and cooperated with government officials to analyze the causes of the incident and to implement policy and procedural improvements to minimize the risk of similar incidents in the future,” Hoffman said.
ABSG Consulting issued its report to BSEE and Black Elk Energy; it is available at: http://www.blackelkenergy.com/images/documents/Investigation-of-WD-32-Platform-Explosions-on-11-16-12.pdf
Ofwat allows retailers to raise prices from April
Retailers can recover a portion of excess bad debt by temporarily increasing prices from April 2022, according to an Ofwat statement.
The regulator confirmed its view that levels of bad debt costs across the business retail market are exceeding 2% of non-household revenue, thereby allowing "a temporary increase" in the maximum prices. Adjustments to price caps will apply for a minimum of two years to reduce the step changes in price that customers might experience.
Measures introduced since March 2020 to contain the spread of Covid-19 could lead to retailers facing higher levels of customer bad debt. Retailers’ abilities to respond to this are expected to be constrained by Ofwat strengthening protections for non-household customers during Covid-19 and the presence of price caps.
In April last year, Ofwat committed to provide additional regulatory protection if bad debt costs across the market exceeded 2% of non-household revenue.
Georgina Mills, Business Retail Market Director at Ofwat said: “These decisions aim to protect the interests of non-household customers in the short and longer term, including from the risk of systemic Retailer failure as the business retail market continues to feel the impacts of COVID-19. By implementing market-wide adjustments to price caps, we aim to minimise any additional costs for customers in the shorter term by promoting efficiency and supporting competition.”
There are also three areas where Ofwat has not reached definitive conclusions and is seeking further evidence and views from stakeholders:
- Pooling excess bad debt costs – Ofwat proposes that the recovery of excess bad debt costs is pooled across all non-household customers, via a uniform uplift to price caps.
- Keeping open the option of not pursuing a true up – For example if outturn bad debt costs are not materially higher than the 2% threshold.
- Undertaking the true up – If a 'true up' is required, Ofwat has set out how it expects this to work in practice.
Further consultation on the proposed adjustments to REC price caps can be expected by December.
"While it’s great that regulators are helping the industry deal with bad debt in the wake of the pandemic, raising prices only treats the symptoms. Instead, water companies should head upstream, using customer data to identify and rectify the causes of bad debt, stop it at source and help prevent it from occurring in the first place," she said.
"While recouping costs is a must, water companies shouldn’t just rely on the regulator. Data can help companies segment customers, identify and assist customers that are struggling financially, avoiding penalising the entire customer in tackling the cause of the issue."
United Utilities picks up pipeline award
A race-against-time plumbing job to connect four huge water pipes into the large Haweswater Aqueduct in Cumbria saw United Utilities awarded Utility Project of the Year by Pipeline Industries Guild.
The Hallbank project, near Kendal, was completed within a tight eight-day deadline, in a storm and during the second COVID lockdown last November – and with three hours to spare. Principal construction manager John Dawson said the project helped boost the resilience of water supplies across the North West.
“I think what made us stand out was the scale, the use of future technology and the fact that we were really just one team, working collaboratively for a common goal," he said.
Camus Energy secures $16m funding
Camus Energy, which provides advanced grid management technology, has secured $16 million in a Series A round, led by Park West Asset Management and joined by Congruent Ventures, Wave Capital and other investors, including an investor-owned utility. Camus will leverage the operating capital to expand its grid management software platform to meet growing demand from utilities across North America.
As local utilities look to save money and increase their use of clean energy by tapping into low-cost and low-carbon local resources, Camus' grid management platform provides connectivity between the utility's operations team, its grid-connected equipment and customer devices.