Participants in Ekofisk

person by Kristin Øye Gjerde, Norwegian Petroleum Museum
The question of who “owns” Ekofisk is not straightforward. In simple terms, however, the field and the rest of Norway’s continental shelf (NCS) belongs to the Norwegian state. This was determined on 14 June 1963, when the Storting (parliament) passed the Act Relating to Exploration for and Exploitation of Submarine Natural Resources. This permits licences to be awarded on certain terms.

— The Norwegian state "owns" Ekofisk, but many companies have had the rights to explore and exploit the natural resources at Ekofisk.
© Norsk Oljemuseum

So it is more appropriate to ask which companies hold and have held rights from the state to explore for and exploit the natural resources in Ekofisk.

More specifically, that relates to interests in production licence (PL) 018. This was awarded in the first licensing round on the NCS in 1965.

The Phillips name has always been included among the licensees. But that is the only constant presence in the list of participants.

This article addresses how the licence composition has altered and how far these changes have been affected by developments in the oil industry generally and on the NCS in particular.

First licensing round, 1965

A single company, A P Møller, was given a sole concession in 1962 to explore for and produce oil on the Danish continental shelf for 50 years.

It is unlikely that anything similar could have happened in Norway, even though America’s Phillips Petroleum Company applied to the Norwegian government in 1962 for a similar licence.

In exchange, it offered to carry out seismic surveys worth NOK 1 million on the NCS. However, consideration of this request was put on hold.

The experience gained by the Norwegian authorities from giving hydropower concessions to domestic and foreign companies since the early 20th century meant nobody was going to get a sole licence.

Instead, the government announced a first licensing round on the NCS on 9 April 1965. The outcome on 17 August was that nine of 11 applicant groups were awarded a total of 74 blocks.

Norwegian industrial interests were then kept at arm’s length from the expensive and risky business of oil exploration, with two exceptions.

One was Norsk Hydro, which participated in the French-led Petronord group, and the other was the Norwegian Oil Consortium (Noco) in the Amoco-Noco team.

The Phillips group comprised the US company (51.74 per cent) with Fina Production Licenses AS (30 per cent) and Norsk Agip (18.26 per cent). It applied for and secured PLs 016, 017 and 018.

Exploring for oil was initially a very uncertain and expensive business. In addition to seismic surveys, the Phillips group had to charter a drilling rig.

That was required for a certain number of wells which the partners were committed to drill under the licence terms. They also had to pay the government an annual fee of NOK 50 000.

But the group had little idea that it had hit the jackpot. PL 018 covered blocks 1/5, where nothing has admittedly been found, 2/4 containing Ekofisk, 2/7 with Eldfisk, and 7/11 holding Cod.

A production licence on the NCS gives its holders the exclusive right to conduct exploration drilling for and production of petroleum deposits within a specified area. A production licence on the NCS gives its holders the exclusive right to conduct exploration drilling for and production of petroleum deposits within a specified area. Such licences are awarded by the Ministry of Petroleum and Energy to sets of licensees. These are comprise oil companies, with one designated as the operator to conduct operations on behalf of each group. Each licensee owns its proportionate share of the petroleum produced from the licence area. If a commercial discovery is made in the licence area, it can be developed by the licensees. This must be done on the basis of an approved plan for development and operation (PDO), which has been drawn up in accordance with the provisions of Norway’s Petroleum Act. Oil and gas which have not been produced remain the property of the Norwegian state.

Enter Petronord

The Phillips group pursued talks in 1967 with the Petronord group on a closer collaboration aimed at spreading risk more widely on the NCS.

These negotiation were initiated after other companies had drilled dry wells and spent a lot of money without seeming to have anything to show for it.

The outcome in 1968 was a swap of licence interests – a fairly common practice in the international oil industry. Phillips and Agip transferred 20 per cent of their holdings to Petronord in exchange for a similar proportion of the latter’s licences.

At the same time, agreement was reached that the two groups would share the cost of the Ocean Viking drilling rig and use it turn and turn about.

This brought a number of new licensees to PL 018 – Elf Norge AS (7.1 per cent), Total Norge (5.325 per cent), Aquitaine Norge AS (3.55 per cent) and Norsk Hydro Produksjon AS (2.5 per cent).

In addition, the minor French companies Eurafrep Norge AS, Coparex Norge AS and Cofranord AS each held a tiny fraction.

Fina retained 30 per cent, while Phillips reduced its share from 51.74 per cent to 36.96 per cent and Norsk Agip was cut from 18.26 to 13.04 per cent.

Rumours of a big discovery began to circulate in the autumn of 1969, with 25 October taken as the date when the geologists were sure a major find had been made in block 2/4. But Phillips did not officially report it to the government until 23 December.

This success was a good start for everyone who now held a stake in the licence, including Hydro. However, the interests Petronord passed to the Phillips group never yielded anything – which nobody could have predicted when the swap was made.

A press release on the Ekofisk discovery was finally issued on 2 June 1970. Meanwhile, the Norwegian government was seeking to secure a stronger involvement in NCS operations.

In deepest secrecy, the government bought up shares in Hydro on 9-15 December 1970 which ensured a majority state holding in the company.

This acquisition was officially approved by the Council of State on 22 January 1971, and gave the state a small stake in Ekofisk.[REMOVE]Fotnote: Hanisch, Tore Jørgen and Nerheim, Gunnar, Fra vantro til overmot?, Norsk oljehistorie, volume 1, Oslo, 1992: 165-166.

The Petronord deal had given Hydro an option to acquire 12 or 24 per cent of the group’s interest in a discovery.[REMOVE]Fotnote: Ibid. Holdings in PL 018 were therefore redivided again on 1 January 1971.

While the Phillips group retained its previous shares, Norsk Hydro Produksjon AS purchased interests from its Petronord partners which left it with 6.7 per cent of PL 018.[REMOVE]Fotnote: Elf Norge AS went down to 5.396 per cent, Total Norge to 4.047 per cent, Aquitaine Norge AS to 2.698 per cent, Eurafrep Norge AS to 0.456 per cent, Coparex Norge AS to 0.399 per cent and Cofranord AS to 0.304 per cent.

The next change in licensee composition occurred on 1 July 1977, when Elf and Aquitaine merged to form Elf Aquitaine Norge AS and thereby had an 8.094 per cent holding.

Statoil in and out

After the creation of Statoil in 1972, Norway’s state oil company built up a dominant position on the NCS with the right to a 50 per cent interest in new licences.

But many years were to pass before it secured a foothold in PL 018. That did not occur until 1988, when both international politics and major economic interests were involved.

The Troll gas sales agreement with a European consortium was the spark. Swapping licence interests between Statoil and France’s Elf and Total could provide the basis for this deal.

Estimated to contain 60 per cent of Norway’s gas reserves, Troll was proven in 1981 and declared commercial two years later. Nailbiting sales talks with continental gas buyers in 1985 were essential for developing the field.

These negotiations made slow progress, with the French particularly lukewarm. Something had to be done to persuade them to take a more positive view.

Elf and Total wanted licence interests in Troll and the Sleipner gas field. Could that be achieved, it might make the authorities in France more receptive to an agreement.

Statoil was therefore ready to enter into a swap which gave the French companies holdings in the two gas fields in exchange for a one per cent stake in Ekofisk.

Since it was difficult to estimate the value of this exchange, a net profit deal was also agreed – if revenues from one field exceeded a set value, the other party would be compensated.

The NOK 800 billion Troll gas sales agreement was entered into in May 1986, with the swap of licence interests coming into force on 1 April 1988.

This deal was considered important for securing French government approval of the sales agreement with Gaz de France, which was needed for a Troll go-ahead.[REMOVE]Fotnote: Reported by Ole-Johan Lydersen, a participant in negotiating the agreement, on 20 August 2019.

The advantage for Statoil of securing an interest in Ekofisk was the right this conferred to attend management committee meetings, providing it better insight into licence developments.

It gave the company control over the whole transport chain for gas exports, something which had concerned it ever since the Norpipe link from Ekofisk to Emden was installed in the 1970s.

During the 1980s, the Ekofisk Complex represented an important hub for Norwegian gas exports. The Ekofisk 2/4 S riser platform, operational from 1985, tied the Statoil-operated Statpipe transport system into Norpipe.

This installation was owned by Statoil but operated by Phillips. In 1998, the Statpipe-Norpipe line was relaid to bypass the Ekofisk Complex.

Another but less important reason why the state oil company wanted to know what was going on in PL 018 was the relationship between Tommeliten and Edda.

The former was a condensate field operated by Statoil which produced to the Phillips-operated Edda oil and gas field 12 kilometres away.

Following the oil price slump in 1985-86, Phillips – which had a 25 per cent interest in Tommeliten – became sceptical about developing it and withdrew from the project.

Statoil nevertheless secured acceptance in 1986 for a cheaper development solution based on subsea templates – which gave it useful experience with underwater technology.

Although Phillips had pulled out, it still wanted the Tommeliten wellstream to flow to Edda – not least because this field had proved half the size originally estimated.

That provided spare gas processing capacity. Moreover, the Tommeliten gas could be injected into the Edda reservoir to increase oil production.

The tie-in to Edda was implemented. According to Statoil, however, negotiating tariff terms between the Tommeliten and Ekofisk licences proved difficult.[REMOVE]Fotnote: Reported by Håkon Lavik, 15 August 2019.

Statoil’s interest in PL 018 changed again on 1 January 1999, when the government secured a five per cent stake for the state’s direct financial interest (SDFI) on the NCS.

Part of the Ekofisk II agreement with the Phillips group, this gave Statoil 5.95 per cent[REMOVE]Fotnote: Norwegian Petroleum Directorate, Facts, 2000. and resulted in a corresponding reduction in the holdings of the other licensees.

For the first time since 1968, Phillips saw its share of the licence reduced – but only from 36.96 per cent to 35.112 per cent.

Several reforms related to Norwegian state ownership in the petroleum sector were under way at this time. Plans for part-privatising Statoil to achieve greater flexibility internationally were initiated in 1999 and approved in 2001.

Another change was that administration of the SDFI, which had lain with the state company since 1985, was transferred in 2001 to a separate company called Petoro.

The latter took over various Statoil holdings in fields. Where the Greater Ekofisk Area was concerned, it acquired five per cent in PL 018 on 10 May 2001. That left Statoil with 0.95 per cent.

Total becomes biggest licensee

Crude prices slumped to a record low at the end of the 1990s, leaving the oil companies with acute profitability problems. They responded with mass redundancies and restructurings.

Larger entities provided greater strength in the market, improved cost control and better positioning in relation to the competition for reserves.

The turmoil which followed in the wake of these restructurings also affected the purchase and sale of interests in the Ekofisk licence.

Saga Petroleum, which acquired Norminol’s holding on 1 January 1995, disappeared on 11 January 2001. Its stake was taken over by Norsk Hydro Produksjon, which thereby rose to 6.654 per cent.

The French interests were gradually consolidated, with Eurafrep, Coparex and Cofranord being acquired in 1990 by Elf Rep, Elf Rex and Norminol respectively.

Elf Rep and Elf Rex then merged in the summer of 1992, and this company was incorporated in 1997 in Elf Petroleum – which thereby acquired 8.449 per cent of PL 018. Elf was merged into TotalFinaElf in the summer of 2000.

Just before Christmas that year, Total and Fina’s licence interests were merged with Total Norge’s holdings and thereby amounted to 31.87 per cent.

When these shares were then incorporated with TotalFinaElf’s, the result was a combined holding of 39.896 per cent. From 6 May 2003, TotalFinaElf was renamed Total E&P Norge AS.

This company then ranked as the largest licensee in PL 018, with the operator – now ConocoPhillips Skandinavia AS following the 2002 merger – in second place with 35.112 per cent.

Since Conoco had no stake in Ekofisk from before, its union with Phillips Petroleum did not contribute to increasing the company’s combined holding.

In addition, Italy’s Eni Norge AS took over Agip’s interests in the Greater Ekofisk Area on 15 December 2003.

Statoil merges with Hydro

After Petoro had acquired the bulk of Statoil’s interest in PL 018, a new change occurred in 2007 when the state company merged with Hydro’s petroleum and energy division.

From 1 October that year, StatoilHydro ASA held 0.95 per cent of the licence while StatoilHydro Petroleum had a 6.654 per cent interest.

These holdings were combined from 1 January 2009 into a 7.604 per cent stake held by StatoilHydro Petroleum AS. The company was renamed Statoil Petroleum AS on 2 November 2009.

The final change of name for this licensee occurred on 16 May 2018, when Statoil became Equinor. This was intended to signal that it embraced not only fossil fuels but also renewable energy sources such as solar and wind power.

A similar concept underlies the new company formed on 10 December 2018 by Eni Norge and Point Resources under the name Vår Energi AS.

“Vår” has a double meaning in Norwegian, denoting not only “Our Energy” but also springtime as a season of youth, freshness and greening.

Licence interest in 2019

On the 50th anniversary of the Ekofisk discovery in 2019, ConocoPhillips Skandinavia is operator for the field with a 35.11 per cent holding.

The other licensees at this time are Total E&P Norge AS (39.90 per cent), Vår Energi AS (12.39 per cent), Equinor Energy AS (7.60 per cent) and Petoro AS (five per cent).[REMOVE]Fotnote: Norwegian Petroleum Directorate fact pages, 13 August 2019.

 

Production licence 018
Area North Sea
Awarded 1-A
Date of award 1 September 1965
Duration until 31 December 2028
Original area (square kilometres) 1 752.704
Current area (square kilometres) 851.767

 

Published 23. September 2019   •   Updated 7. October 2019
© Norsk Oljemuseum
close Close

Safety on Ekofisk – and on the NCS

person by Trude Meland, Norwegian Petroleum Museum
The Norwegian authorities want the country’s petroleum sector to be the best in the world for health, safety and the environment (HSE). And Ekofisk operator ConocoPhillips aims to improve safety continuously.
— A man on his way into a Whittaker life boat during a rescue exercise at Ekofisk. Photo: ConocoPhillips/Norwegian Petroleum Museum
© Norsk Oljemuseum

Oil and gas operations on the Norwegian continental shelf (NCS) are perpetually changing, with knowledge and technology making constant progress. New ways of operating get introduced, and digitalisation has demanded major organisational changes in recent times. HSE must adapt to a changing reality. Safety is a perishable commodity, and must always be high on the agenda. “Good enough” is not sufficient, either for the Norwegian government or for ConocoPhillips.

The goal of being best in the world – and in Norway – calls for continuous safety improvements. That requires good interaction between human, technological and organisational (HTO) factors.

Procedures and technical safety will always provide the bedrock in this endeavour. But the concept of corporate culture also became a key part of the safety mindset in the 1980s. A number of behavioural and cultural programmes have been adopted – along with new ways of thinking about safety. Some of the priority areas are covered below.

Understanding how and why these innovative approaches came to characterise safety on the NCS and Ekofisk needs to start with a review of relevant historical developments off Norway.

Workers heard

The first and biggest change in offshore safety came with the Norwegian Working Environment Act of 1977, which was extended to fixed installations on the NCS the following year.

This legislation was aimed at protecting job conditions, ensuring equal treatment at work and securing collaboration between employer and employees. It involved a sharp upgrading in employment rights compared with the Worker Protection Act of 1956. Elected safety delegates and a working environment committee became mandatory in companies, while worker participation in decision-making was given legal force.

Starting from an acknowledgement that people make mistakes, the Act specifies that safety work in companies must therefore aim to reduce the consequences of such human errors. Working conditions and technology must be tailored to the employees – the goal of safety efforts is not to change people but the conditions they work in.[REMOVE]Fotnote: Foss, G (2006). Adferdsbasert Sikkerhet i En Norsk Kontekst: Petroleumsnæringen Som Case, 2006. MSc thesis, faculty of social sciences, University of Stavanger: 21.

Democratically elected by the workforce, safety delegates were given greater rights to intervene in work processes. That included the power to halt dangerous work, which represented a substantial constraint on the employer’s right to manage.

Rooted in the Working Environment Act, the safety regime for the petroleum industry continued to develop on the basis of the “Norwegian model”. This social template comprises a strong welfare state, a regulated labour market and an interventionist collaboration between three parties – employers, unions and government. Where the oil and gas sector are concerned, the model involves government – represented by ministries and regulators – companies and unions joining forces to develop pay and working conditions, including HSE.[REMOVE]Fotnote: Meland, T (2016),Sikkerheten utfordres”, Norsk Oljemuseums årbok 2017: 43.This tripartite collaboration involves a principle of equality and depends on trust, good communication and mutual recognition of roles and responsibilities.

However, this trust and mutual recognition have been challenged at times ­– particularly when the Norwegian economy has taken a turn for the worse.

Phillips Petroleum was an early adopter of the safety delegate system. It introduced this on its Ekofisk platforms in 1976, two years before the Act came into force offshore. That was not only to be proactive, but also because the Ministry of Industry ordered this following a fire on Ekofisk 2/4 A where three people died.[REMOVE]Fotnote: The ministry ordered Phillips on 4 December 1975 to establish a safety delegate service covering contractors and sub-contractors involved on the field. See Smith-Solbakken, Marie, and Vinnem, Jan Erik “Alfa-plattform-ulykken”, Store norsk leksikon, 18 November 2019.An industrial safety and environmental committee was also appointed, which became a forerunner of the mandatory working environment committee required by the Act. Read more: Fire om Ekofisk 2/4 A

Self-regulation and collaboration

In the early phase on the NCS, during the 1970s, offshore safety was largely dealt with through extensive regulations, checks, inspections and detailed orders. This regulatory approach was difficult to administer and supervise, and the constant introduction of new technology demanded continuous updating of the rules. Such detailed control also undermined the industry’s understanding of its own responsibility as well as hampering innovation and creativity.

In order to develop a more flexible system and give the players a greater sense of responsibility, a form of self-regulation was gradually applied to the companies in the 1980s. This involved a shift from specific regulatory demands to performance-based requirements – detailing what standards were to be attained, but not how that was to be done. The companies were given growing freedom to choose what safety solutions they wanted to apply, and greater opportunities to blend technology, experience and creativity in cost-effective ways. A precondition for such performance-based regulations was the tripartite collaboration mentioned above, with its mutual trust between employers, unions and government.[REMOVE]Fotnote: Foss, G (2006). Adferdsbasert Sikkerhet I En Norsk Kontekst: Petroleumsnæringen Som Case, 2006. MSc thesis, faculty of social sciences, University of Stavanger: 24.

Establishing formal interaction between the parties took time, but an external reference group for regulations was set up in 1986. Chaired by the Norwegian Petroleum Directorate (NPD), this forum included unions and employer organisations in the oil and gas sector as well as government authorities. That arena made it possible for members to keep abreast of ongoing regulatory work and to comment on important proposals as they were made. In turn, this created greater ownership of, and consensus on, the final proposals.[REMOVE]Fotnote: Report no 7 (2001-2002) to the Storting, Om helse, miljø og sikkerhet i petroleumsvirksomheten, Vol no 7 (2001-2002), Ministry of Labour and Government Administration, Oslo, 2002: downloaded from https://www.regjeringen.no/no/dokumenter/stmeld-nr-7-2001-2002-/id134387/sec2.

Continuous safety improvements became the motto, with operations on the NCS becoming steadily safer in the 1980s. They eventually set a standard for other industries exposed to risk.

More conflict

During the 1990s, mutual trust between the parties in the Norwegian petroleum sector gradually weakened and the level of industrial conflict increased.

The conditions which had underpinned the safety system in the 1980s changed as the industry experienced rapid technological progress and constant reorganisations.[REMOVE]Fotnote: Alteren, B, and HSE Petroleum: “Endring – organisasjon – teknologi”, HMS-arbeid under endring, 2003 (topic 4 in HSE Petroleum K2: Endring, organisasjon, teknologi). Vol STF38 A03406, department for safety and reliability, Sintef (printed edition). Sintef, Teknologiledelse, sikkerhet og pålitelighet, Trondheim: 11.

Oil prices were also substantially lower for most of the 1990s than they had been in the previous decade, and a big slump began in 1998 – with a corresponding decline in profitability. In cooperation with the authorities, the industry initiated a far-reaching campaign to reduce costs. This led not least to restructuring and downsizing. Meanwhile, the unions had been weakened by a number of tough labour disputes as well as mutual rivalry and internal disputes. Read more: From in-house association to independent union. 

The level of safety and risk on the NCS was nevertheless regarded as good. Improvements were admittedly no longer seen, but both companies and government felt that conditions had stabilised at a high level.

So the NPD’s injury statistics, which were based on lost-time injuries (when the victim was unable to work after an accident), showed no deterioration. But those working offshore were constantly voicing concerns. Although accidents and lost-time injuries had not risen, a number of serious incidents were occurring on the NCS. These included big gas leaks, well kicks and collisions between units.[REMOVE]Fotnote: Report no 7 (2001-2002) to the Storting, Om helse, miljø og sikkerhet i petroleumsvirksomheten, Vol no 7 (2001-2002), Ministry of Labour and Government Administration, Oslo, 2002: downloaded from https://www.regjeringen.no/no/dokumenter/stmeld-nr-7-2001-2002-/id134387/sec2. Several unions expressed worries about the increased risk of major accidents.

However, the oil companies did not accept this negative picture. They reported that, despite several serious incidents, safety had never been better.

Certain top executives even claimed that safety attracted too much attention and absorbed excessive resources. Union concerns were considered by some to be camouflage for underlying social and economic motives.[REMOVE]Fotnote: Ryggvik, Helge, R (2004). Fra forvitring til ny giv: Om en storulykke som aldri inntraff? Working note no 26: 13.

So how could two such different perceptions of reality exist side-by-side? The answer may lie in the lack of suitable measurement tools for risk assessment.

The NPD had to acknowledge that a mismatch existed between the number of incidents offshore and in the injury statistics, and that available tools gave an inadequate basis for establishing the true level of risk on the NCS. It took the initiative to develop a new approach to measurement in this area, which became a study entitled “trends in risk level on the NCS” or RNNS.[REMOVE]Fotnote: Now “trends in risk level in the petroleum activity” (RNNP). The project was unique in that it combined quantitative data with qualitative observations and analyses. Work on it got going seriously in the winter of 2000.

From an early stage, it became clear that the indicators produced by the RNNS revealed a worrying trend. This challenged the tripartite collaboration, and undermined the mutual trust underpinning the whole safety system. “We’re registering far too many serious incidents out on the platforms,” Magne Ognedal, the NPD’s safety director, told Oslo daily Dagbladet. “I don’t have a good gut feeling any more.”[REMOVE]Fotnote: Stang, Leif, 16 October 2000, “Frykter storulykke”, Dagbladet. He and his boss, NPD director general Gunnar Berge, sent a joint letter to the industry ordering it to take “new” steps to reduce the level of risk. This must be seen as a sharp reprimand to the whole sector.

Ekofisk difficulties

The general level of safety improved on the NCS in 1980s, but the conditions which caused the subsequent weakening also applied to Ekofisk and Phillips. Like most of the oil companies, the latter cut back its workforce sharply in the late 1990s.

At the same time, the Ekofisk Committee – the biggest union on the field – had been weakened by internal disputes. It had left the Federation of Offshore Workers Trade Unions (OFS) and joined the Norwegian Oil and Petrochemical Workers Union, part of the Norwegian Confederation of Trade Unions (LO). See article: Ekofisk Committee merges with NOPEF. 

Undesirable incidents, such as suspended loads being dropped, chemicals escaping to the sea and gas leaks, were also reported in the Greater Ekofisk Area. See the separate articles: Fatal work accident, Chemical spill to the sea, Seabed gas leak halted, Shut down by gas cooler leak.

Political reactions

In parallel with the adoption of the RNNP tool, the Ministry of Petroleum and Energy produced Report no 39 (1999-2000) to the Storting (parliament) on 9 June 2000. This White Paper declared that oil and gas operations were being pursued within a prudent framework, but also noted the NPD’s assessment that the overall level of risk was increasing.

At the same time, the NPD had found that virtually all accidents and injuries could ultimately have been avoided.[REMOVE]Fotnote: Report no 7 (2001-2002) to the Storting, Om helse, miljø og sikkerhet i petroleumsvirksomheten, Vol no 7 (2001-2002), Ministry of Labour and Government Administration,Oslo, 2002: downloaded from https://www.regjeringen.no/no/dokumenter/stmeld-nr-7-2001-2002-/id134387/sec2: 107. It felt that the most important improvement potential related to workplace customisation and making individual workers more aware.

Eighteen months after the petroleum ministry’s White Paper, in December 2001, the Ministry of Labour and Government Administration presented Report no 7 (2001-2002) to the Storting.[REMOVE]Fotnote: Constitutional responsibility for safety and the working environment in the petroleum industry had been transferred to the Ministry of Local Government and Labour, later the Ministry of Labour and Government Administration.This criticised the way the companies organised safety, and particularly the failure to give sufficient emphasis to tripartite collaboration and worker participation. The companies were ordered to maintain their commitment to technology development which aimed to achieve improvements in the HSE area.

A new concept was introduced by the White Paper – the zero mindset. This reflects the view that accidents do not happen, but are caused. All can therefore be prevented. The goal was to be zero injuries and accidents, which required establishing accountability at every level and paying continuous attention to risk management, prevention and learning lessons.[REMOVE]Fotnote: Report no 7 (2001-2002) to the Storting, Om helse, miljø og sikkerhet i petroleumsvirksomheten, Vol no 7 (2001-2002), Ministry of Labour and Government Administration,Oslo, 2002: downloaded from https://www.regjeringen.no/no/dokumenter/stmeld-nr-7-2001-2002-/id134387/sec2. This can be interpreted as an assumption by the government that human behaviour was the underlying cause of accidents and injuries.

But the zero mindset was only a small part of the White Paper, with the ministry giving the main emphasis to accountability and concentrating on risk management, prevention and learning lessons.

The NPD followed up by fronting risk management and improvements to safety technology which could reduce risk – along with a good safety culture.

Managing safety at work would remain entrenched in legislation, regulations, guidelines and standards. The actual management job was governed by the internal control regulations, which addressed systematic HSE work by companies. Barrier thinking became an important condition for good safety and risk management. According to the Petroleum Safety Authority Norway (PSA),[REMOVE]Fotnote: The NPD was split in 2002 into two independent agencies, with that part of the directorate which had dealt with safety and the working environment becoming the PSA with effect from 1 January 2004. It reported to the Ministry of Labour and Government Administration. its purpose is “to establish and maintain barriers so that the risk faced at any given time can be handled by preventing an undesirable incident from occurring or by limiting the consequences should such an incident occur”. Normal practice is to divide barriers into three main types – organisational, technical and human/operational – although these can be difficult to distinguish from each other. However, organisational barriers include procedures, specifications, work permits, management systems and safe job analyses (SJAs). The human barriers, for their part, involve knowledge, experience, characteristics and behavioural patterns. While technical barriers can in principle perform their function on their own, they should and must often be combined with organisational and/or operational components. But people and organisation cannot serve as a barrier function on their own. They must always be combined with at least one of the other types.

Barrier thinking is closely related to high fault tolerance – which means that a system continues to function if something goes wrong. Inbuilt capabilities limit the consequences of such faults.

Another important safety-related concept is redundancy, which involves an additional margin being built into systems where a high level of reliability is essential. A cornerstone of modern safety thinking, redundancy refers to the degree of reserve capacity – technical or human – in a system or an organisation.

How this affected Ekofisk

After 2000, the behavioural aspect was given ever-increasing emphasis in safety work as the zero mindset spread rapidly through the Norwegian oil industry. This conveys a simple message which is difficult to disagree with, setting a long-term goal of preventing harm to people and the environment and of avoiding accidents and losses. ConocoPhillips was one of the many companies to embrace the zero mindset, and it formulated its safety goal from 2003 as “zero undesirable incidents”.[REMOVE]Fotnote: “Målet er null uønskede hendelser”, Pioner, February 2003.

The following appears on the company’s website: “More than ever, the company will promote a culture that focuses on safety in everything we do, by implementing the zero philosophy to eliminate unintentional incidents. “The zero philosophy is intended to reduce the number of injuries and critical incidents to zero. Attitudes are a key element of our safety training to ensure that everyone takes responsibility for their own and co-workers’ safety.”[REMOVE]Fotnote: http://www.conocophillips.no/social-responsibility/health-safety-and-environment/.

Human behaviour acquired an important role in the zero mindset, and ConocoPhillips worked on the principle that changing the way employees thought and acted would improve safety. As the company itself expresses this: “recognise that harm does not occur – it is created – and that it is the individual’s attitudes and experience which help to avoid harm”.[REMOVE]Fotnote: Stolpe, M (2007). Nullfilosofi i Praksis: Et Case Av Statoil Mongstad, IV, 139: 48.

Under the slogan “Our safety, my responsibility”, a number of different awareness-raising measures and attitude-changing campaigns were initiated.

Four Rs

It would not be true to say that the zero mindset and the concentration on human factors as safety risks were introduced to Norway’s oil sector by the 2001 White Paper. Behavioural or cultural programmes directed at changing employee behaviour and attitudes were a trend which had already been heading towards the NCS for several years.

As early as 1996, Phillips introduced its 4R programme, which aimed to create a workplace free of accidents and serious incidents. Its title stood for register, report, react and reduce.

Like most other companies, Phillips believed that existing systems and procedures took care of the risk that a major accident might occur.[REMOVE]Fotnote: “4R er godt i gang”, EkofiskNytt, no 21, week 50, 1996.

The 4R programme aimed to register and report all types of incidents in the workplace, including poor behaviour and hazardous conditions as well as site untidy conditions. Every case would lead to a reaction from the company – in other words, a follow-up – in order to reduce the risk of accidents. An important consideration was that employees would become conscious of and involved with their own working habits and those of others. Such involvement would develop preventive behaviour, with employees becoming more aware of the errors they and their colleagues were making. This forms part of what is known as organisational redundancy in safety work. Employees will consult with, check and correct each other. Ekofisk personnel would “use a magnifying glass to uncover every hazard before an undesirable incident occurs”.[REMOVE]Fotnote: “Økt satsing på forebyggende sikkerhet”, EkofiskNytt, no 20, 1996.The company’s new vision was an accident-free environment at work offshore and on land, as well as in the home.[REMOVE]Fotnote: “Økt satsing på forebyggende sikkerhet”, EkofiskNytt, no 20, 1996. In other words, changes in behaviour and attitudes would not only colour life on the platform, but also ashore and domestically.

With 4R designed as a low-threshold scheme, personnel were required to note down observations in the workplace and deliver them to their immediate superior. And management was to give feedback about how the matter was dealt with. This system was a tool for getting to grips with the small issues which were not defined as an incident, but which might lead to one later if management failed to deal with them.[REMOVE]Fotnote: Bjørn Saxvik, HSE manager, Greater Ekofisk Area operations. Interviewed by Kjersti Melberg and Trude Meland, Norwegian Petroleum Museum, 16 October 2019.Implementing the programme – still in use today across the Greater Ekofisk Area – on the various platforms was ranked on a scale from one to 10. It applied initially to cleanliness and tidiness, and prizes were awarded for passing level six.[REMOVE]Fotnote: “Økt satsing på forebyggende sikkerhet”, EkofiskNytt, no 20, 1996.

Phillips and the other companies on the NCS were not alone in implementing such cultural and awareness processes. The ideas came primarily from large consultancies known for their safety systems, which developed strategies and campaigns purchased and applied by the oil companies.

The largest and best-known of these consultants was DuPont, an American chemicals group which has specialised in safety and protection. Its work was based on a theory that 85-95 per cent of all accidents were caused by human error and that a correlation existed between hazardous behaviour and major accidents. The latter are regarded as acute incidents which immediately or subsequently cause serious personal injuries and/or fatalities, serious damage to the environment and/or loss of major material assets.[REMOVE]Fotnote: Meland, T (2018).Sikkerheten utfordres”. Årbok Norsk Oljemuseum 2017: 39.

Often called the iceberg model, the theory applied by DuPont has occupied a key place in the petroleum industry over the past 20 years and also comes in a popular version. This states that incidents, minor accidents and near misses, and major accidents all have the same causes and that the relationship between them is constant. Reducing the frequency of minor accidents will therefore produce a corresponding cut in the risk of major disasters.

Although the iceberg model is not often referred to directly in communications from ConocoPhillips, it nevertheless underlies the many campaigns pursued by the company. These ideas are controversial internally, and not everyone is equally convinced about the correlation between behaviour and major accident risk, or the value of the theory.[REMOVE]Fotnote: Bjørn Saxvik, HSE manager, Greater Ekofisk Area operations. Interviewed by Kjersti Melberg and Trude Meland, Norwegian Petroleum Museum, 16 October 2019.Nevertheless, the belief that the key to improved safety lies in changing worker behaviour is fundamental to much of the organisation in this area at ConocoPhillips.

Key conversation

The 4R programme was the first awareness campaign initiated by Phillips to improve safety through behavioural change, and was followed during the 2000s by a number of similar drives.

Phillips merged in 2002 with Conoco, another US oil and gas company which had been part of DuPont from 1981 before being sold off in 1999.

After the link-up, the renamed ConocoPhillips company launched a new personal safety involvement (PSI) awareness programme based on a template developed by Conoco and DuPont. This was also inspired by Statoil’s new “open safety conversation” awareness programme, which the Norwegian state oil company had introduced in 2002.[REMOVE]Fotnote: Bjørn Saxvik, HSE manager, Greater Ekofisk Area operations. Interviewed by Kjersti Melberg and Trude Meland, Norwegian Petroleum Museum, 16 October 2019.

PSI builds on the theory that the great majority of accidents are attributable to human action, such as unsafe behaviour and poor working habits, and aims to address such aspects anew.[REMOVE]Fotnote: “Samtaler om sikkerhet”, Pioner, June 2004.

It is based on creating the good conversation in the workplace, being present and daring to admit one’s incompetence. Through conversing, employees will learn how to talk to each other about work-related assignments and circumstances.

Training programmes, activities and lectures were developed. The formal PSI lessons comprised two-hour practice conversations for awareness training, a full-day course and a training camp where participants formulated and agreed on HSE obligations.

Before a job can start, its risk aspects and possible injury prevention measures must be discussed between the supervisor and those doing the work. This conversation is intended to function as an approach to setting targets which make safety a natural part of the workplace culture.

PSI is regarded as a management tool for eliminating risky behaviour, as in-house magazine Pioner reported in a 2014 article:

Managers, supervisors and safety personnel will visit groups and individuals in the workplace and conduct a conversation about safety measures with those doing the job. The topic of the chat is how safety has already been put into effect and how [it] might be enhanced in the relevant work operation. The manager will then fill out a simple report on the safety conversation, which is filed for further processing.[REMOVE]Fotnote: “Samtaler om sikkerhet”, Pioner, June 2004.

The falcon was chosen as a symbol, the article noted. Its sharp eye, viewing the world from great heights and swiftly closing in when it has a specific target, is the behaviour ConocoPhillips wants from its employees.[REMOVE]Fotnote: “Samtaler om sikkerhet”, Pioner, June 2004.

PSI remains the most important instrument for improving the safety culture on Ekofisk. It is important to emphasise that this was not introduced as a replacement for other safety measures, but as a supplement. Tools such as SJAs and work permits (WPs) still underpin all operations carried out offshore.

An SJA is a systematic and step-by-step review of all risk elements before starting a job or operation, in order to identify possible measures to remove or control identified hazards. For its part, a WP provides written authorisation to perform a defined job in a safe manner at an given place on a facility and under specified conditions. This will ensure that normal barriers are not removed without compensatory measures being adopted. It also ensures that all other activities on the facility are assessed to avoid unintentional consequences or undesirable incidents escalating.

A common model for WPs and SJAs has been developed for use on the NCS. While safety delegates do not have a particular role in approving WPs, they play a defined part in SJAs.

Spirit values

Operations at ConocoPhillips have eventually become entrenched in a set of values known as Spirit – for safety, people, integrity, responsibility, innovation and teamwork.

This applies not only locally in Norway but also for the group worldwide, and is intended as guidance on how work should be done across the whole organisation.

  • Safety: we operate safely.
  • People: we respect one another, recognising that our success depends upon the commitment, capabilities and diversity of our employees.
  • Integrity: we are ethical and trustworthy in our relationships with stakeholders.
  • Responsibility: we are accountable for our actions. We are a good neighbour and citizen in the communities where we operate.
  • Innovation: we anticipate change and respond with creative solutions. We are agile and responsive to the changing needs of stakeholders, and embrace learning opportunities from our experience around the world.
  • Teamwork: our “can do” spirit delivers top performance. We encourage collaboration, celebrate success, and build and nurture long-standing relationships.

Spirit builds on a recognition that safety is always the most important consideration. The group’s expressed goal is to have a safety culture which yields top HSE results. As part of its awareness work and compliance with the Spirit values, ConocoPhillips developed a three-point HSE policy:

  1. work is never so urgent or important that we cannot take the time to do it safely and in an environmentally responsible manner
  2. we will always set specific HSE goals for all our activities, and strive at all times for continuous improvement
  3. against the background of the setting in which we pursue our daily work, contributing to sustainable development is a duty and important strategy for us.[REMOVE]Fotnote: ussand, Kjetil L, and Kleggetveit, Stian K (2014), Kunnskapsoverføring – En Vei Til Økt Sikkerhet: 60.

Life-saving rules

The International Association of Oil and Gas Producers (IOGP), to which ConocoPhillips belongs, published a set of life-saving rules in 2010 aimed at reducing risk and eliminating serious incidents in the industry.

This code was not intended to address all risks and hazards in the oil and gas sector, but to call attention to activities where the threat of accidents was highest. It supported existing company systems rather than replacing their management solutions, guidelines, safety training programmes, operating procedures or work instructions.

With the life-saving rules, the IOGP has turned the spotlight on activities which have shown the greatest probability for accidents with fatal consequences.

The idea is that standardising these principles will simplify training, assist compliance with and understanding of critical precautions, and help with experience transfer.

Virtually all the operators on the NCS were quick to adopt these rules, with ConocoPhillips opting to apply eight such provisions.

These would support and strengthen existing safety programmes and contribute to reaching the HSE goal of zero undesirable incidents. The rules applied to the group’s own employees and contractors everywhere it operated, and were to be a permanent part of its corporate culture.[REMOVE]Fotnote: “Bringing safety to life”, Spirit, ConocoPhillips, 2014.

These eight are as follows:

  1. Work with a valid work permit when required.
  2. Obtain authorisation before entering a confined space.
  3. Protect yourself against a fall when working at height​​​.
  4. Follow safe lifting operations and do not walk under a suspended load.
  5. ​Verify isolation before work begins.
  6. Obtain authorisation before starting ground disturbance or excavation activities​​.
  7. Obtain authorisation before bypassing, disabling or inhibiting a safety protection device or equipment​.
  8. Wear your seat belt, obey speed limits and do not use any mobile device while driving.

A ninth life-saving rule on keeping out of the line of fire was later introduced by the IOGP. And rules on establishing and respecting barriers and exclusion zones were also incorporated in ConocoPhillips Norway’s safety culture to eliminate undesirable incidents.

New crisis – new spotlight

After many years with high oil prices, Norway and the rest of the world saw them slump sharply during 2014 – which led in turn to cost cuts and downsizing in the Norwegian petroleum sector. Concerns quickly arose that efforts to trim spending would have a negative impact on safety in the industry. Although major incidents had been avoided, the business was not accident-free. The safety position on the NCS was again characterised in 2015-16 by a number of serious occurrences and other challenges, at the same time as big change processes, reorganisations and redundancies were under way. A number of media stories suggested it was appropriate to ask whether safety on the NCS was being sacrificed in an economic downturn.[REMOVE]Fotnote: Meland, T (2016),Sikkerheten utfordres”, Norsk Oljemuseums årbok 2017.

Journalists were not alone in posing such questions – government regulators, unions and public opinion all gave expression to concerns about the level of safety.

Against that background, Anniken Hauglie, the Conservative minister for labour and social affairs, appointed a committee to address this issue. It was charged with determining whether a connection existed between the many incidents offshore and the big cost cuts made by the industry in the wake of the 2014 oil price slump. A report was produced, and formed the basis for Report no 12 (2017-2018) to the Storting on HSE in the petroleum industry – the first White Paper on the subject in seven years.

Both this document and the preceding committee report concluded that tripartite collaboration was functioning well, but faced challenges. As a result of restructuring and efficiency improvements, company organisations were devoting less time and resources to tripartite work. But the difficulties seemed even greater for employer-employee (bipartite) relations.[REMOVE]Fotnote: Meland, T (2016),Sikkerheten utfordres”, Norsk Oljemuseums årbok 2017.

The White Paper nevertheless concluded that Norway’s HSE regime was by and large in good shape, and that the main provisions in the regulations were robust and should be retained.

During and after this oil crisis, cutting costs was important for ConocoPhillips – as it was for all the other players in the sector. The company was robust, but had to take some action. The workforce was downsized, although without compulsory redundancies. Ensuring that the process was voluntary ensured calm in the organisation, reports Bjørn Saxvik, HSE manager for Greater Ekofisk Area operations.[REMOVE]Fotnote: Bjørn Saxvik, HSE manager, Greater Ekofisk Area operations. Interviewed by Kjersti Melberg and Trude Meland, Norwegian Petroleum Museum, 16 October 2019.

During the oil industry downturn in 2014, Steinar Våge, the regional manager in ConocoPhillips at the time, reported that the company’s positive safety trend was also going into reverse. Now was the time to sharpen up. To get back on track, full compliance with procedures was essential. Everyone had to pull themselves together and be present in all operations. By doing this while also demanding that the eight life-saving rules were observed, the company would get back on track towards zero undesirable incidents.[REMOVE]Fotnote: Våge, S, “Effektivitet og konkurransekraft”, Pioner, no 1, 2014.

That called in addition for utilising risk analyses and exerting control of other organisational and technical barriers, along with PSI conversations. Together with the life-saving rules, these would set the standard for work in ConocoPhillips. Efforts to make safety improvements were to be resumed through good communication and a working culture where it was permissible to stop and ask questions.[REMOVE]Fotnote: Skjeggestad, K R, HSE manager, ConocoPhillips, “Beredskap er å være forberedt”. Pioner, no 4, 2017.

ConocoPhillips was named best operator on the NCS in the 2018 Gullkronen (Gold Crown) awards for its work with the Ekofisk field. Presented annually by consultancy Rystad Energy, these distinctions are presented to companies, teams or individuals who have shown an outstanding commitment on the NCS.[REMOVE]Fotnote: Rystad Energy is an independent analysis and consultancy company established in Oslo during 2004. The Gold Crown awards were first made in 2009. The jury citation stated: “The winner has displayed a high level of production efficiency over a long period, with an excellent HSE standard.”[REMOVE]Fotnote: “Vant pris som beste feltoperatør på norsk sokkel”, Pioner, no 1, 2018. This award must be viewed as confirmation that ConocoPhillips and the workforce on the Ekofisk field had succeeded in bringing the safety trend back on track.

Conclusion

Safety work is not about eliminating risk, but involves having good barriers – to protect against errors, hazards and accidents – as well as redundancy. But it is also about good communication between work colleagues and managers. Much be learnt by listening to what others have experienced and by sharing one’s own experience.[REMOVE]Fotnote: Skjeggestad, K R, HSE manager, ConocoPhillips, “Beredskap er å være forberedt”, Pioner, no 4, 2017.

Published 11. May 2020   •   Updated 9. November 2020
© Norsk Oljemuseum
close Close

Getting the timing right

person by Trude Meland, Norwegian Petroleum Museum
The issue of work schedules for offshore personnel has been subject to constant discussion between government, employers and unions – leading to radical changes over 50 years.
— The offshore workers arrive at the platform for a new work period. Photo: Kjetil Alsvik/ConocoPhillips
© Norsk Oljemuseum

Different systems for rotating personnel between work and leisure functioned in parallel on the drilling rigs during the early years of oil exploration in the Norwegian North Sea. The most common practice was nevertheless one week on and one off. To get a holiday, people carried on working offshore until they were entitled to three weeks free in one go.

However, this arrangement proved impractical – particularly for workers who going offshore or returning home on a Saturday or Sunday. They never got a full weekend off. To stagger such change-overs, the schedule was extended to eight days offshore with eight days free. One work period in five was also dropped, so every fifth free spell was 24 days long.[REMOVE]Fotnote: This gave a working time which averaged 38 hours per week and 1 824 hours per year after holidays. That corresponded to shift work on land.

When Norway’s Working Environment Act (WEA) came into force in 1977, the permitted length of a continuous shift on land was cut. But there was no assurance that this would be applied offshore. In its original form, the Act did not permit the 12-hour working day normal on all offshore installations. So amendments were needed to adapt the legal provisions to fixed platforms.[REMOVE]Fotnote: The Act specified that working time was 36 hours over seven days for work carried out around the clock throughout the week. That represented 1 877 hours a year on average. Adjusting this for four weeks of holiday gave a net working time of 1 733 hours.

The Norwegian Petroleum Directorate argued that reducing working time offshore was impractical, with the “special character” of the oil industry requiring exemptions.[REMOVE]Fotnote: Ryggvik, H, 1999, “Fra forbilde til sikkerhetssystem i forvitring: Fremveksten av et norsk sikkerhetsregime i lys av utviklingen på britisk sokkel”, Working Paper, Volume 114, Centre for Technology and Culture, University of Oslo, printed edition. Oslo: Centre for Technology, Innovation and Culture (TIK), University of Oslo: 16. As early as 1975, however, Ekofisk operator Phillips Petroleum had agreed to working hours for its own personnel which accorded with the provisions proposed for the new Act. A royal decree of 9 July 1976 extended the existing Worker Protection Act, with certain exceptions, to the fixed installations offshore on a temporary basis.

The WEA was then applied to these facility in 1977.[REMOVE]Fotnote: Ryggvik, H, 1999, “Fra forbilde til sikkerhetssystem i forvitring: Fremveksten av et norsk sikkerhetsregime i lys av utviklingen på britisk sokkel”, Working Paper, Volume 114, Centre for Technology and Culture, University of Oslo, printed edition. Oslo: Centre for Technology, Innovation and Culture (TIK), University of Oslo: 18. This meant that offshore workers had their working time regulated and acquired legal safeguards against unfair dismissal. After long discussions, the North Sea schedule was by and large established as two weeks working offshore and three weeks free on land.

But the WEA was not applied to floating units such as rigs, and working time in that part of the oil industry continued to be regulated by Norway’s Ship Labour Act.

 An extra day

Norway’s legislation on paid holidays was amended in 1981 to give everyone a legal right to four weeks and one day off. The latter was nicknamed the “Gro Day” after Gro Harlem Brundtland, the Labour premier of the day. This meant the two weeks on/three weeks off schedule now imposed too many working hours. It was decided that the extra would be compensated as 25 hours of overtime per year.[REMOVE]Fotnote: Working time was reduced from 1 752 to 1 727 hours.

Agreement was reached in the 1986 collective pay negotiations on a 7.5-hour normal working day and a 37.5-hour week. Personnel both on land and offshore working a continuous shift also had their weekly hours cut 33.6.[REMOVE]Fotnote: Net working hours after deducting holidays were reduced from 1 752 to 1 727. To comply with these new terms, the offshore schedule was altered to two weeks at work, three weeks ashore, two weeks at work and four weeks on land.

When the Gro Day was introduced in 1981, the Labour government originally proposed introducing a full week’s extra holiday in stages over three years. But that failed to materialise. In 2000, the Norwegian Confederation of Trade Unions (LO) proposed a fifth holiday week for all employees, which would thereby reduce the number of hours in a work-year.[REMOVE]Fotnote: That involved an additional four free days of 7.5 hours offshore (32 hours). The hours to be worked were then reduced from 1 612 to 1 580. That demand was accepted, and most workers could thereby enjoy five weeks off. This naturally had consequences offshore, but implementing it there was not a straightforward matter.

A schedule of two weeks at work and three/four weeks at home had been 19 hours short of a normal work-year. That was overcome by deducting this time from pay or leaving the first 11 hours of overtime unpaid.[REMOVE]Fotnote: Sande, Leif, “Arbeidstiden på sokkelen”, Sysla – meninger, 11 March 2015.

The new holiday deal meant that an offshore worker would be doing 12 extra hours per year. This was initially paid as overtime, which the unions found unsatisfactory. They demanded the full holiday entitlement awarded to everyone else through the introduction of a schedule of two weeks on and four off. In 2002, the Norwegian Oil Industry Association (OLF – today the Norwegian Oil and Gas Association) allowed local deals under the offshore agreements to adopt this two-four scheme. All the companies subject to these agreements introduced the new schedule. ConocoPhillips was among the operators to do this, in its case covering the Greater Ekofisk Area.

However, the two-four system meant workers were falling short of a work-year by 122 hours.[REMOVE]Fotnote: Working 12 hours a day for 14 days, followed by four weeks off, means that an employee works 168 hours every six-week period. That adds up to 1 460 hours per year. Annual pay was thereby cut by 7.71 per cent to take account of the reduced time worked.[REMOVE]Fotnote: Norwegian Official Reports (NOU) 2016:1, Arbeidstidsutvalget — Regulering av arbeidstid – vern og fleksibilitet. https://www.regjeringen.no/no/dokumenter/nou-2016-1/id2467468/sec16. Other conditions were also set on Ekofisk. The whole offshore organisation was to be reviewed to find efficiency gains, and the agreement specified that the change would not lead to an increase in the workforce.[REMOVE]Fotnote: Pioner, “2-4-ordningen innføres”, March 2003.

Published 21. October 2019   •   Updated 21. October 2019
© Norsk Oljemuseum
close Close

Knut Åm – oil and gas veteran

person by Kristin Øye Gjerde, Norwegian Petroleum Museum
The special contribution made by Knut Åm to Phillips Petroleum Company was one reason for his appointment in 2014 as a Knight First Class of the Royal Norwegian Order of St Olav.
— Knut Åm in his office in 1993. Photo: Dag Myrestrand/ConocoPhillips
© Norsk Oljemuseum

Åm was born at Årdal in the Sogn district of western Norway in 1944, and grew up in Oppdal and Volda/Ørsta where he proved an able pupil at school. 

He opted to study mining engineering at the Norwegian Institute of Technology (NTH) in Trondheim, graduating with honours in 1967. 

Åm’s first job was with the Norwegian Geological Survey (NGU), again in Trondheim, where he worked and conducted research for six years. One of his jobs was to interpret aeromagnetic measurements of sub-surface rocks made from the air, which provide valuable information on geology and prospects for finding petroleum. In a series of publications, he described the big sedimentary basins identified in the Skagerrak between Norway and Denmark and in the Norwegian and Barents Seas. 

He joined the Norwegian Petroleum Directorate (NPD) in 1974, serving as a section head in the resource department and a principal engineer in the safety department. 

That was followed by three years with Statoil, where he became the state oil company’s first vice president for research and development. His appointments at the time included chairing a research programme on offshore safety, which led to legislation enacted by the Storting (parliament) and a bigger research effort. 

Joining Phillips

olje og gassveteran knut åm,
Hovedkontoret til ConocoPhillips i Bartlesville, Oklahoma. Foto: ConocoPhillips

Åm secured a job with Phillips in 1982 and was soon sent to the head office at Bartlesville in Oklahoma to get better acquainted with the company and its corporate culture. 

After a year in the USA, he returned to the company’s Tananger office outside Stavanger and became the first Norwegian to serve as offshore manager for the Greater Ekofisk Area (GEA). 

That put him in charge of 23 platforms, with responsibility for the waterflooding programme as well as the project to jack up a number of the installations. These major developments extended the producing life of the GEA and sharply increased estimates for recoverable reserves from its fields. 

Åm led this work during difficult times, with low oil prices and the need to implement cost savings and overcome substantial financial challenges. As if that were not enough, he also taught at the University of Bergen from 1985 to 1990 as an adjunct (part-time) professor of applied geophysics. 

First Norwegian chief executive

Knut åm,
Knut Åm ved kontorpulten i 1993. Foto: Dag Myrestrand/ConocoPhillips

After heading operations in the Permian and San Juan Basins at Odessa, Texas, from 1988-91, Åm became the first Norwegian president and managing director for Phillips Petroleum Norway. 

That put him in charge of 3 000 employees in the GEA as well as in Tananger, Oslo, Teesside and Emden. This was when a redevelopment of Ekofisk was planned, along with the future cessation and removal of old platforms.[REMOVE]Fotnote: https://www.fylkesmannen.no/globalassets/fm-rogaland/dokument-fmro/felles-og-leiing/brev-og-artiklar/fm-tale-til-knut-am.pdf 

By 1996, Åm was back in Bartlesville – now as vice president and head of all exploration and production in Phillips. He stayed in that job until retiring in the USA during 1999.

Offices and committees

But his working life did not end there. Appointments from 1999 to 2007 include membership of the Statoil board – and many similar posts can be mentioned. 

Åm has been president of the Norwegian Geological Council and the Norwegian Petroleum Society, and chair of the Norwegian Oil Industry Association (now the Norwegian Oil and Gas Association). 

He led the exhibition committee of the 1996 ONS oil show in Stavanger, and has chaired Bergen’s Christian Michelsen Research institute as well as the industrial council of the Norwegian Academy of Science and Letters.  

In addition to chairing Hitec ASA, he has been a director of several technology companies. 

Mention must also be made of the improved recovery committee appointed by the Ministry of Petroleum and Energy with Åm as chair. This produced a report in September 2010 which presented 44 specific measures for improving the recovery factor on the Norwegian continental shelf (NCS). 

Through his work and many appointments, Åm has been acclaimed for a combination of expertise, creativity and determination.  He also demonstrated the ability to tackle the requirements of Norway as a nation as well as the industry and its employees – not least with regard to the working environment and safety in a demanding and risky offshore industry. 

Optimist

In retirement, Åm is an optimist – with regard to the climate as well. “I’m very concerned with nature, but believe we should extract the resources its given us,” he told Otium in 2016. 

“Norway could have a long and good future in the oil and gas industry if people give it more support. Exploring for new deposits is important, but we should also seek to achieve a far better recovery factor from both new and existing fields.” 

“You can naturally concentrate on life’s negative aspects. Then everything’s simply awful. I think you’ll be a far happier person if you prefer to see the positive side of life. I call that self-motivation. We need more of that in the energy sector.”[REMOVE]Fotnote: https://api.optimum.no/sites/default/files/PDF/optimum-magasinet-2016.pdf 

Published 21. October 2019   •   Updated 21. October 2019
© Norsk Oljemuseum
close Close

Knut Ove Kristensen – veteran manager with his heart in HSE

person Kjersti Melberg, Norwegian Petroleum Museum. Based on an interview with Kristensen on 12 September 2019.
More than forty-five years of service on Ekofisk underpin Knut Ove Kristensen’s status as a pioneering leader on the Norwegian continental shelf (NCS). His involvement began in 1974 when he switched from a career at sea to become a process technician for Phillips Petroleum.
— Knut Ove Kristensen in conversation with process apprentice Fredrik Svindland Theissen (left) and operations manager Siri Friestad. Photo: ConocoPhillips
© Norsk Oljemuseum

Early promotion and trust followed, and he served as an offshore installation manager (OIM) for more than 33 years in the Greater Ekofisk Area. 

Plain-speaking

Kristensen recalls that he was a committed young man in the early 1970s – an open, curious and plain-speaking person who was not afraid to criticise health, safety and environmental (HSE) conditions. 

The working style he encountered offshore suited him well, ready as he was to speak his mind. “I’ve undoubtedly been a loud-mouth. I’m used to having zealous people in the Family With grand-parents and a father who served as mayors, which is perhaps why I don’t quite know when to keep quiet.” 

Thinking back to working conditions when he started in petroleum industry, he recalls living on Gulftide, Norway’s first production facility, and says it was fascinating. 

“This was an old jack-up rig, with the helideck installed on planks. We were four to a cabin, and things were pretty shabby. Primitive conditions prevailed, to put it mildly.” 

The workplace at the time was characterised by the presence of the Americans, and confusions frequently arose between them and those who were not particularly good at English. 

“It was very unusual,” reflects Kristensen. “We were trained up by the Americans, of course – they were the ones who knew about this business. There were a lot of misunderstandings among the Norwegians, people who pretended to understand the messages they were given about what jobs to do. Both serious and funny situations occured. Those of us who’d been to sea undoubtedly had an advantage in that we knew the language a bit better. The rest were fishermen and smallholders and ordinary people from the Districts in Western Norway who didn’t speak much English. Offshore terminology wasn’t easy for people who didn’t have the language.” 

He quickly grasped the ethos in this working environment. “The Americans often only gave you one chance. If you showed that you could cope with your job, you won trust, new opportunities and more responsibility.” 

Given his background in the Norwegian merchant marine, however, Kristensen reacted negatively to a number of the conditions which prevailed at the time. “I was one of the youngest then, and that wasn’t always easy because there were a number of older and more experienced people who felt they had a ‘monopoly of brains’,” he comments. “And quite a lot were pushy. “Working conditions weren’t orderly, with proper employment contracts like I was used to from my time at sea thanks to the Norwegian Seamen’s Union – unionisation and the like.” 

He adds that he is grateful for everything he learned from the Americans, but that they at the time were not particularly keen on unions and the Norwegian concept of collaboration between employers and employees. “They thought it was enough to enter into agreements on a mantoman basis or with the company, and saw no need to organise this via trade unions.” 

Involved

Given his views, it is not surprising that he became involved at an early stage with the Ekofisk Committee by serving as secretary to Øyvind Krokvik, who was first head of this union. 

Kristensen explains that he has been committed throughout his career to involvement and worker participation and to good collaboration between unions, the safety service and management. That was particularly important during the early years of the petroleum industry on the NCS, he emphasises. His experience of union work accompanied him into various senior posts on Ekofisk. 

With a gleam in his eye, he says the following about his promotion: “Acquiring managerial responsibility early on may have had something to do with my involvement with the union. Putting in place systems for worker participation and collaboration was particularly important in the early years of Norway’s offshore industry. 

“I played a part in establishing the parameters which govern industrial relations out on the field today, with unions and the safety delegate service.

I became the country’s youngest OIM at the age of 24, and served as a manager out there for 41 years.

They may have thought ‘he’s more trouble than we need, so we’ll just promote him up and then be quit him.” 

Kristensen reports that he has been preoccupied throughout his managerial career with ensuring that “things are genuine” – that a manager must understand and personally be part of “the home team”. He explains that as the ability to understand a position from the standpoint of the various parties involved, and adds that he has thrived offshore with a living and working community. This he defines as one “where you get close to people, where everyone is seen and heard, and where they understand that they play an important role in reaching a common goal”.[REMOVE]Fotnote: Pionèr, ONS 2018: 8. 

It did not take him long to learn how to adjust his management style to the offshore environment, but admits that this approach has developed over the years. The leadership culture which dominated on the platforms during the early years undoubtedly influenced me a bit. I was probably very inflexible and saw things in black-and-white, but have become more judicious and considered over time. 

“Nobody left my office earlier in any doubt about what I meant. I thought that saved a lot of time. But I can’t have been too bad, or I wouldn’t have held down the job for so long.” 

Strategy

Kristensen’s long service makes him unique on Ekofisk, and he has thought a lot about management. His expressed strategy has been to get people on side over HSE through commitment and integrity – and without any “second agenda”. 

“Working in the Ekofisk Complex with 600-700 people is an unusual experience,” he observes. “I held the same job as the man in charge for 20 years. “That means you’re ‘on stage’ the whole time, and attend 10-12 HSE meetings every week. You’ve got to get people committed, drive a doctrine and sell a message. This involves getting what people have to concentrate on implanted in their hearts and minds so they can contribute to their own safety and that of others, he explains. 

“You must be genuine, and your own integrity must be order. You have to build trust, and not least display respect for your audience.” 

“What’s been a powerful help for me is that I’m on the home team. I’ve been a skilled worker myself and have been through most things.” 

Kristensen emphasises several times that he regarded the unions, their elected officers and the safety delegates as a resource in this work. 

“The tripartite collaboration pursued in the petroleum industry between government, companies and unions functions very well,” he concludes.  “This is about informing and involving people, and ensuring that decisions aren’t taken over their heads. Our company has achieved that in a positive way.” 

“The fact that Ekofisk is a mature field and ConocoPhillips is a mature company also has something to do with it. Cooperation with the Petroleum Safety Authority Norway and other authorities is also very good.” 

Kristensen denies that union-management collaboration has become more strained during the downturns experienced by the petroleum industry. “Strained and strained – we must adjust to external conditions and try to protect the jobs needed to safeguard the industry. But nobody’s ever been made redundant by this company. That’s worthy of respect.

Downsizing has been solved with severance packages. People have often been given early retirement. From that perspective, it’s been a privilege to work for an operator company.” 

Commitment

After almost 46 years with the company, Kristensen’s commitment to continuous improvement, good safety and high production regularity is as strong as ever. Recognising that substantial progress has been made in the HSE area over the years he has worked in the industry, he affirms that this issue is closest to his heart. 

“We’ve staked out the path as we’ve advanced. We don’t accept incidents and accidents. We take a completely different approach to risk today. Accidents which do occur are used for all they’re worth in an effort to say to ourselves: ‘this has actually happened, but it’s our duty to learn from it’.” 

Kristensen has personally experienced accidents and injuries at close hand, and thereby knows the importance of preventive safety work to protect people, the environment and equipment. 

He will never forget some incidents – and immediately mentions the Alexander L Kielland disaster in 1980 With 123 casualties. An article in local daily Stavanger Aftenblad as recently as 2012, with photos of all those who have died on duty on the NCS since 1966, made a big impression on him. 

Britain’s Piper Alpha explosion in 1988, when 169 people were killed, is another major incident he recalls. His conclusion is that the petroleum sector has not been a Promised Land for all. 

The former OIM proudly mentions a number of HSE improvements which have partly been the result of technological advances in the industry during his time. But he warns about hazards which still exist, such as vessels drifting out of control. A well-known incident on New Year’s Eve in 2015 made a particularly strong impression on him. 

A 150000 tons, unmanned barge had come loose and was threatening to collide with installations on Ekofisk. Several hundred workers from this field and neighbouring Valhall were flown to safety and production was shut down. The barge passed the platforms at a distance of about one nautical mile, but Kristensen found the actual incident and the threat it posed frightening. 

“Drifting vessels which come loose in rough weather, which can get pretty challenging out there, are perhaps the biggest hazard we now face. Luckily we have good procedures to handle such challenges.” 

Reminder

Such incidents and near-misses are regarded by Kristensen as a reminder that the petroleum industry is under an obligation to learn the necessary lessons. He points to the potential for learning from other industries, and emphasises the good collaboration which prevails across the company. Mechanical handling provides a good example, he says. 

“Things can go terribly wrong. After fatal accidents in the 2000s, we established a work group which held monthly meetings. I took part as technical manager for these facilities. We involved everyone in the logistics chain on land, at the base and on the platforms. That attracted so much attention and such great improvements that we’ve now managed to prevent virtually all undesirable conditions in this area.” 

Despite good systems and routines, colleagues on the installations are Kristensen’s most important reminder of the responsibility he has had as an OIM on Ekofisk. 

“Experiences from my early years meant that I have become particularly attentive to HSE – and I was involved in quite a lot, of course. But this mostly relates to the individual who gets injured on your watch and on your shift – in other words, the people you work with. They stood on the drill floor and worked so that the sparks flew around their ears. Having only two-three fingers used to confer ‘status’. 

He notes that improvements have a lot to do with technological progress. Much risk has been eliminated by automating a great deal of the work which used to be done manually. 

“But we still have more than enough opportunities to injure ourselves. This has a lot to do with awareness – being present in the real world, making sure you’re focused. That’s actually expected for 12 hours at a time.” 

A respectful attitude to his big responsibilities and duties was maintained by Kristensen to his last working day. “Emergency preparedness is like being at war – you do what you’re told. But you feel it. Although we’ve trained so long at this, you’re still conscious of being responsible for several hundred lives. Taking a wrong decision could … You must act on the basis of the information you’ve got, not what you know many months later. When you tackle it, however, you get a sense of mastery at solving the problem together with an outstanding emergency response organisation on land. Ultimately, though, you’re the skipper on your own ship.” 

Time to reflect

Kristensen has finally retired from ConocoPhillips, giving him time to reflect over his own commitment and lifestyle offshore as it affected him and his family. 

“For my own part, I must say that it’s had a price,” he admits. “I couldn’t get involved in politics or organisations, for example. I was only at home half of the time. I followed up the kids when I was at home, of course, but never felt I could be active in associations and so on, contribute the way I’d have liked. 

He has found the transition to retirement unaccustomed in many ways. “Simply remembering that I’m not going offshore is a big change, for example. I had to deal with so many challenges right up to my last day at work that it’s been impossible to prepare anything. I ought to have thought about and planned retirement a bit better, of course, but I’ll undoubtedly find something to do when I want to.” 

Published 21. October 2019   •   Updated 25. October 2019
© Norsk Oljemuseum
close Close