ConocoPhillips
2006 Sustainable Growth Report2006 Sustainable Growth Report
Operate Safely

Asset and Operations Integrity

The Humber refinery
The Humber refinery conducted over 200,000 pipe inspections as part of our asset integrity efforts.
We focus on continually improving asset integrity by raising standards, developing more effective measurement and auditing programs, strengthening management systems and enhancing training. In refining, we have developed required standards for process and personal safety, with clear direction on critical elements such as asset integrity inspections, facility siting, change management and incident investigations. Our exploration and production operations conducted a global assessment of asset and operational integrity in 2006 and developed action plans for improvement in 2007.

While following industry standards on managing equipment, we have established additional internal standards for fixed assets and equipment. Our company-operated refineries and many exploration and production assets are participating in a peer assist program in which employees inspect other plants and share best practices.

Although process safety has been central to how we operate our assets, we are reviewing our process safety management systems to identify opportunities for improvement in the light of recent industry recommendations.

Refining recently has established a manager of process safety to lead efforts to continuously improve in this important area of operations. Refining also has established an internal team that will conduct in-depth process safety audits at all domestic and international refineries within the next 18 months. This effort will focus on identifying improvement opportunities, as well as best process safety practices and programs.

Humber Refinery Incident

The U.K. Health and Safety Executive (HSE) in 2006 published the results of its investigation into an explosion and fire which occurred following a pipe failure in the saturate gas plant at our Humber refinery in 2001. The 30-page public report on the Internet (http://www.hse.gov.uk/comah/conocophillips.pdf) included recommendations for improvements to pipe inspection procedures; management of change systems; corrosion monitoring; and recording and sharing of inspection information.

We already had implemented these and other measures ahead of the HSE report, following our own investigation in 2001 which identified 12 key action areas. These included the formation of a new division with special responsibility for asset integrity and reliability, and the introduction of a rigorous program of process hazard analysis for all refinery units.

The first five-year cycle of process hazard analysis studies will be completed in 2009. Every pipe onsite already has been examined in a program involving over 200,000 inspections completed within schedule. This was followed by a detailed review of all piping systems, applying the most appropriate assessment techniques. Further inspections were conducted in a three-year program, completed in 2006, which has increased the inspection find rate, eliminated overdue inspections, halved the number of minor leaks and introduced a piping retirement philosophy that has resulted in more than 600 lines being replaced. This effort is being maintained with some 10,000 piping test points inspected each year.

Pipeline Integrity

Our program of pipeline inspection, integrity assessment and remediation goes beyond mandatory requirements to include crude oil gathering systems that are not covered by current regulations. The program includes hydrostatic testing and internal inspection of gathering lines, upgrading lines with external corrosion prevention systems, cleaning lines to minimize internal corrosion and decommissioning or converting low-flow systems to truck delivery. We also have increased the frequency of aerial pipeline patrols of crude oil gathering lines to several times a week so that, should a leak occur, it will be detected more promptly.

By mid-2007, we had assessed over 85 percent of our U.S. cross-country pipeline system. Pipeline assessments include both hydrostatic testing and internal inspection using devices called “smart pigs.” The goal is to have the entire 10,800-mile company-operated main line system tested by 2010.

Smart pigs
Smart pigs, like the one pictured above, can precisely locate internal or external defects, such as cracks, dents or corrosion.
These efforts reduced the number of pipeline spills measuring more than one barrel in size from 97 in 2005 to 40 in 2006.

Informing the public about our pipelines is vital to the safe operation of the system and the prevention of damage by third parties, such as excavators. During 2005 and 2006, we mailed almost two million brochures to stakeholders along our U.S. pipeline routes to encourage the use of “call before you dig” underground utility location services and to inform them what to do in the event of an incident. In 2007, the program will be expanded to include stakeholder audiences near storage terminals. We also will participate in an industry-sponsored survey to measure the effectiveness of the communications.

In Alaska, we execute thorough inspection programs for production and water injection pipelines to meet our goal to identify potential problems early. This helps ensure that pipelines can be repaired or replaced before severe damage occurs.

Since the mid-1990s, we have met or exceeded our targets for external inspection and repair of our pipeline systems in Alaska. Where significant corrosion or corrosion potential exists, we repair the pipe and insulation. This program also has led to improved insulation designs that provide better protection against water damage.

Caribou
Caribou using a pipeline crossing in Alaska.
Although most pipelines on the North Slope are supported above ground to protect the delicate tundra against thawing, there are some locations where pipelines must be routed underground, such as at intersections with surface roads and drilling pad locations and caribou crossings. At these locations, we use remote inspection methods involving ultrasound to determine if any pipe requires replacement.

Marine Integrity

ConocoPhillips achieved its goal of operating an all doublehulled tanker fleet in 2007, a year ahead of plan.With the addition of the latest tanker, the Polar Enterprise, and the sale of our remaining double-bottom, single-hulled vessel, all 12 tankers in the fleet have double-hull protection. ConocoPhillips’ 26 coastal tankers and barges also are double-hulled.

Polar Enterprise, the fifth Endeavour Class tanker in the fleet, was designed specifically for the transport of crude oil from Valdez to the U.S. West Coast. Endeavour Class tankers are built with double hulls which exceed regulatory requirements, as well as two independent engine rooms, twin propellers and twin rudders. Cargo, fuel and lubricating oils are isolated from the ship’s outer hull by ballast tanks or void spaces.

We work closely with our shipping contractors to achieve the highest standards of environmental and safety performance, and we strongly recommend chartering double-hulled vessels wherever possible. We vet every ship we charter – reviewing its safety management, security and maintenance history and procedures – before it carries our product. A key stipulation is the capability to store and dispose of oily wastes in strict compliance with the International Convention for the Prevention of Pollution from Ships (MARPOL) and local regulations.

In 2006, we created the position of quality assurance officer for each of our vessels. This officer is responsible for handling regulatory, environmental compliance and auditing matters, freeing the master and other officers to focus on the safe operation of the ship. Experience in this position will be a future requirement for officers seeking promotion to the rank of captain or chief engineer. The company also trains the crew on vessel handling via ship simulators.

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