Linc Oil’s Fire Exposes Regulatory Weakness

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The recent fire at the Linc Oil and Gas tank farm in Calabar, which claimed 10 lives, and the deafening silence of the Department of Petroleum Resources over the incident has again exposed its weaknesses in enforcing Health Safety and Environment regulations in the oil industry. Ejiofor Alike reports

One of the key qualities that determine the corporate survival of any oil and gas company is Health Safety and Environment (HSE) policy, which measures the extent to which a company conducts its activities in a manner that promotes the health and safety of its employees, assets and the public, as well as protection of the environment.

Speaking in Lagos recently at an oil and gas event, the Chief Executive Officer of Seplat Petroleum Development Company Plc, Mr. Austin Avuru identified HSE as one of the six pillars holding any exploration and production (E & P) company.
Avuru argued that apart from the debt owed the banks by a company, another problem, which can kill a company overnight is HSE issue.
According to him, one dangerous oil spill that results in $200 million compensation is capable of killing an oil company.

The Seplat boss cited the 2010 Macondo incident in the Gulf of Mexico, which led to 27 per cent drop in the share price of BP within five days.
The incident occurred on April 20, 2010 when the Deepwater Horizon semi-submersible Mobile Offshore Drilling Unit (MODU), owned and operated by Transocean, which was drilling for BP in the Macondo oil field located 60 kilometres off the coast of Louisiana, exploded and caught fire.

The Deepwater Horizon sank, killing 11 offshore oil workers and injuring 17 others.
The blowout, which caused the explosion of the rig, also caused what was regarded as the largest oil spill in the Gulf of Mexico.
Avuru recalled that what arrested the share price drop was BP’s prompt announcement that it had set aside $20 billion to pay compensation.

“If your best-performing staff will put you into HSE problem, fire him because he can kill the company overnight,” Avuru told the industry operators.
The Department of Petroleum Resources (DPR), which is the apex regulator of Nigeria’s oil and gas industry, is also responsible for formulation of practical HSE policies and guidelines in line with industry best practice.

The agency formulates HSE policy and enforces a company’s timely and comprehensive compliance, while maintaining effective service delivery for the protection of staff, assets and the environment.
It is the responsibility of the agency to ensure that oil and gas companies operating in the country conduct all HSE activities with utmost degree of competence in accordance with the petroleum laws and industry standards for the benefit of the country.

HSE breaches
However, weak enforcement of HSE guidelines by the DPR has resulted in several incidents of rig fire and other offshore accidents in the upstream segment of the oil and gas industry.
Apart from bad roads, which have resulted in accidents involving tankers carrying petroleum products, regulatory failure, which has encouraged fuel marketers to use tankers that lack road worthiness to lift products at the depots, has also caused accidents on the roads and tank farms.

Despite the presence of DPR officials in all the depots, leaking tankers and other non-worthy vehicles are allowed by compromised officials of the agency to lift products from the depots, thus endangering lives and property both in the depots and the highways.
For instance, few years ago, a non-road worthy truck carrying petrol caught fire on Kayode Street Apapa, which is the road leading into Total’s Apapa depot, NNPC’s LPG Gas Plant, Honeywell, and Oando Depots.

It took the combined efforts of staff of Total, Honeywell, Oando, NIPCO, Nigerian fire service, Petrol Tanker Drivers (PTD), Tego barracks of Nigerian Army, Police and the Western Naval Command of the Nigerian Navy to extinguish the fire.

Also a few years ago, an oil vessel owned by MRS Oil and Gas caught fire while discharging petrol into the company’s depot at Tin Can Island area of Apapa.
The National Emergency Management Agency (NEMA) confirmed that four people were injured.
In early 2016, MRS filling station located near Oando Station in Lawanson area of Surulere in Lagos, was razed by fire, when a tanker was discharging petrol into the station.

In January this year, two persons were confirmed dead and seven others injured when a petrol station belonging to Rabeng Petroleum located in Adigbe area of Abeokuta went up in flames.
The inferno started from a generator which had caught fire when an artisan was welding a pumping machine beside the gas base in the petrol station.

For an artisan to be welding steel near a filling station was an evidence of failure on the part of DPR and the owners of the fuel retail outlet to enforce HSE measures.
Also in January this year, a filling station owned by Strive Energy Limited caught fire in Ado-Ekiti in Ekiti State.

The fire, which started when a leaking tanker discharging petrol spilled its contents, reportedly razed 24 shops.
A Total filling station at Ikosi-ketu area of Lagos was also razed by fire in April this year.
Also recently, RICHBAM filling Station located along Petro Road Bariga in Lagos, was gutted by fire.

All these accidents were caused by weak enforcement of HSE regulations by both the marketers and the regulator.
While some cases of weak enforcement of HSE policy are as a result of outright negligence on the part of DPR, the agency also seems to be intimated by some politically-exposed persons backing some of these oil companies that flout HSE regulations.

For instance, a former acting Director of DPR was once ordered by a Minister of Petroleum Resources to unseal a Lagos depot, shortly after the depot was sealed by the agency for violating relevant regulations.

“If you can seal a depot in your acting capacity, it means that when you are confirmed, you can shut down an oil field,” the minister was said to have told the director in a telephone conversation.

Calabar depot fire
The Cross River Police Command recently confirmed that 10 people died in a fire outbreak that occurred at Linc Oil and Gas tank farm.
The State Commissioner of Police, Mr. Hafiz Inuwa, who gave the figure, added that several other persons sustained injuries.

Unfortunately, neither the DPR nor the company has issued an official statement on the explosion.
Also to demonstrate the audacity of some of these oil firms that are backed by powerful individuals, Inuwa had also stated that the manager of the depot did not brief the police on the cause of the incident.

“Up until now, nobody has come out to tell us that this is what caused the fire outbreak. We have gone round, we have done what we can do but investigation will later reveal what actually led to the explosion,” the police commissioner reportedly said.
The depot manager also reportedly refused to speak with journalists, claiming that he was not authorised to speak.

A marketer who spoke to THISDAY at the weekend on the Linc Oil and Gas Tank Farm fire incident argued that in other climes where law is above every individual, the depot manager of such facility that claimed many lives should be cooling his heels in police custody, rather than being begged for interview by journalists.

It was reported that the fire outbreak occurred when the workers of the station were discharging the old product in the tanks to allow a vessel that berthed to discharge its content, which was a strong indication of the failure of the company to abide by standard safety procedures.
To arrest the flagrant violation of safety guidelines by the operators, the DPR should up the ante by sanctioning the affected companies, irrespective of the positions of their backers in the society.

When the Central Bank of Nigeria (CBN) sneezes, the banks catch cold; the same is applicable to the Nigerian Communications Commission (NCC), and the Nigerian Maritime Administration and Safety Agency (NIMASA). But even the smallest filling station can flout DPR regulations and go scot-free because of the politically-exposed persons backing such retail outlet.
The apex regulator of Nigeria’s oil and gas industry should bite more than it barks to enforce HSE policies and prevent needless loss of human lives and destruction of assets through frequent incidents.