HSE management in Shtokman Development AG - Murmansk workshop 15-16 October 2009

HSE management in
Shtokman Development AG
       Murmansk workshop

       15-16 October 2009

Health, Safety, Environmental & Quality policy

 Being aware of its responsibilities and duties towards its shareholders
 and stakeholders, Shtokman Develoment AG is committed to the
 highest international health, safety and environmental standards.

 In that respect, SDag’s goal is zero harm.
 SDag will play a leading role in promoting and implementing best
 practice. This can be achieved by abiding strictly to these 12 principles:

 1. Management Responsibility          7. Safeguarding of Health and
 2. Respect for Laws and                   working conditions
    Regulations                        8. Corporate Social Responsibility
 3. HSE Risk Management                9. Incident investigation
 4. Safety and Security                10. Contractors and Suppliers
 5. Emergency Response                 11. Competency and training
 6. Respect for the Environment        12. Audits and Inspections
    and Biodiversity

HSE management system

 SDag HSE management system is aligned with the international
 standards ISO-14001 Environmental Management system & OHSAS
 18001 - Occupational Health and Safety management system

 In Russia the reference is made to GOST R ISO 14001 and GOST-
 12.0.230-2007 (OHSAS 18001)

 The purpose for having the HSE management system is to ensure that
 the project related activities (Development of Shtokman gas field)
 follow the highest international HSE standard and fulfill Russian
 requirements

 As part of the evaluation of possible contractors HSE is an important
 part in choosing the right partner.

 Contractors will be thoroughly assessed to ensure they meet
 SDag’s contractual HSE requirements.

The management system cycle

                        The international and Russian
                        standards for HSE management
                        system have these sections

                        This cycle is a very easy way to get a
                        perspective on how the different
                        sections in this kind of management
                        system are related to each other

                        A central part of achieving
                        improvement in HSE is the
                        company’s management, and how
                        they fulfill their role by demonstrating
                        leadership and commitment

                        Continuous improvement through
                        lessons learnt and audits.

Exhibit L – HSE requirements for contracts

 This exhibit states the requirements any contractor working under
 contract for Shtokman has to fulfill. This will demonstrate it’s
 preparedness to meet the highest level of HSE

 Important sections in this document are:
     Respect of laws and regulation
     Responsibilities
     Risk evaluation and management
     Respect for the environment
     Safeguarding of health
     Subcontractors and purchases control
     Competence and training
     Emergency preparedness
     Incidents reporting and investigation
     Audits, reviews and inspections
     General safety & security specification

Exhibit L – HSE requirements for contracts

 Respect of laws and regulation
   Strictly follow the Russian laws and regulations
   Comply with SDag HSE requirements and ensure compliance by sub contractors

 Responsibilities
   Develop a HSE policy and objectives, establish a HSE program for the contract and
    establish HSE key performance indicators (LTI’s, hours worked etc)
   HSE matters are a line management responsibility
   Company has the right to suspend operations if unacceptable HSE practices pose
    a risk
   Contractors project organization should demonstrate how Company’s HSE
    requirements will be met
   Communication (to overcome the language barrier)
   Meetings – putting the HSE on the agenda
   Management of change
   Documentation of work (document control, reference documents and monitoring)

Exhibit L – HSE requirements for contracts

 Risk evaluation and management
     Hazards and effects identifications
     Evaluation of risk connected to scope of work
     Reduction of risk (mitigation of risk/ reduce impact)
     Ensure involvement of personnel in risk evaluation and mitigation
        Job Safety Analysis / JSA
        Safety Training Observation Program / STOP
        Behavioral Base Safety Management / BBS

Respect for the environment

 Assessment of environmental impact from
 project activities

 Develop project environmental procedures

 Establish a Waste management system

 Monitor the effect the scope of work has on
 the environment

 Establish a system that regulates the
 chemicals being used and ensure all
 products has Material Safety Data Sheet
 (MSDS) in both Russian and English

 Selection of environmentally optimal
 solutions and use of chemicals which pose
 least threat to the environment

 Monitor all discharge and know the content
 of it

Exhibit L – HSE requirements for contracts

 Safeguarding of health
   Contractor has to ensure that own personnel and sub-contractors take pre-employment and
    regular approved medical check up suitable to their work conditions
   Establish registry of sickness absence & work related illness
   Perform working environment surveys
   Personal Protective Equipment (PPE)
       All personnel shall have the basic PPE, that is helmet, overall,
        safety shoes, ear protection, gloves, safety glasses
       Special working conditions requires additional PPE, as for
        example respirator equipment, safety harness or goggles for
        welding
   Occupational risks
   Non-occupational risks
   Driving risks. SDag expect a high standard on vehicle
         All vehicle to be equipped with seat belts for all passengers
         Defensive driving training for professional drivers
         No use of mobile telephone while driving
         Vehicle to be equipped with winter chains or tires with spikes/studs
         Any vehicle entering SDag perimeter or under SDag contract will be controlled

                       No alcohol, No drugs - Zero tolerance

Exhibit L – HSE requirements for contracts

 Subcontractors and purchases control take full responsibility

 Competence and training
   Ensure competence of personnel
   Arrange training and specialized training
   Establish good HSE working practices

 Emergency preparedness
   Establish an Emergency system
   Co-ordinate emergency system for the sub-contractors
   Arrange drills and exercises

 Incidents reporting and investigation
     Establish a system for registration of incident and near misses
     Register incident and near misses reports
     Analyse incidents and accidents and take corrective actions
     Investigate and report major incidents or incidents that might have a high potential

Exhibit L – HSE requirements for contracts

 Audits, reviews and inspections
     Prepare for company’s audit and inspection of contractor
     Contractors audits and inspections of own activities and subcontractors
     Execute planned maintenance/inspection/certification
     Regularly inspect own premises and housing
     Establish records of audits and corrective actions
     Handling of non-conformances
     Ensure transfer of HSE experience

 General safety & security specification
     Establish an HSE improvement plan
     Implementation of HSE actions
     Execute equipment control and maintenance
     Supervision and monitoring of work activities
     Establish security management of own premises