BP 2013 Annual Report Download - page 82

BP Annual Report and Form 20-F 201378
Gulf of Mexico committee
Introduction from committee chairman
The Gulf of Mexico committee continues to oversee the group’s response
to the Deepwater Horizon accident, ensuring that the company fulfils all of
its legitimate obligations whilst protecting and defending the interests of
the group. In the past year, the focus has been on the review of ongoing
proceedings in multi-district litigation 2179 and 2185; of the assessment of
natural resource damages; and of a number of other legal proceedings in
relation to the Deepwater Horizon accident.
I believe the committee has been thorough in the execution of its duties.
The high frequency of meetings and long tenure of committee
membership has enabled members to review an evolving and complex
spectrum of issues.
Ian Davis
Committee chair
Role of the committee
The Gulf of Mexico committee was formed in July 2010 to oversee the
management and mitigation of legal and licence-to-operate risks arising out
of the Deepwater Horizon accident and oil spill. The committee’s work is
integrated with that of the board, which retains ultimate accountability for
oversight of the group’s response to the accident.
Process safety expert – Downstream
Mr Duane Wilson continued to report to the committee in his role as
process safety expert for the Downstream segment. In this role he
continues to work with segment management on a worldwide basis
(having previously focused on US refineries) to monitor and advise on the
process safety culture and learnings across the segment. He twice
reported directly to the SEEAC in 2013 and presented detailed reports on
his work (including reporting on a number of visits he has made to
refineries and other downstream facilities).
Reports from group audit and group ethics & compliance
The committee received quarterly reports from both of these functions.
These included summaries of investigations into significant alleged fraud or
misconduct. In addition, both the general auditor and the group ethics and
compliance officer met in private with the chairman and other members of
the committee.
Field trips
In April the chairman and all other members of the committee visited
Alberta, Canada to examine the oil sands being developed there by the
group and third parties. In October a committee member visited operations
at the Tangguh LNG facility in West Papua in Indonesia while another
committee member travelled to Alaska and visited operations on the North
Slope. In addition, three members of the committee visited the
Gelsenkirchen refinery in Germany. In all cases, the visiting committee
members received briefings on operations and the status of local operating
management system (OMS) implementation and risk management and
mitigation. For each visit, committee members then reported back in detail
to the committee and subsequently to the full board.
Committee review
For its 2013 evaluation, the SEEAC used a questionnaire administered by
external consultants to examine the committee’s performance and
effectiveness. The committee responded to the same questions used in
2012 so that any change trends could be discerned. The topics covered
included the balance of skills and experience among its membership, the
quality and timeliness of the information the committee receives, the level
of challenge between committee members and management and how
well the committee communicates its activities and findings to the board.
The evaluation results were generally positive. Committee members
considered that the committee possessed the right mix of skills and
background, had an appropriate level of support and had received open and
transparent briefings from management. The committee considered that
the field trips made by its members had become an important element in
the work of the committee, in particular through such trips giving
committee members the ability to examine how risk management is being
embedded in businesses and facilities.
•GCEoperationsriskreports.
•QuarterlyreportsonHSEperformanceandoperational
integrity.
•Sustainabilityreportingannualoverview.
•Fair,balancedandunderstandable.*
•FieldtripsledbySEEAC(recentvisitsinclude
Canada oil sands, Tangguh LNG, Alaska North
Slope and Gelsenkirchen refinery).
* Undertaken jointly with the audit committee.
SEEAC focus in 2013
•Externalauditorassuranceof
sustainability reporting.
•Groupauditassuranceofsystemof
internal control.
•S&ORauditassurance(aspartofgroup
audit).
•Explosionorreleaseatfacilities.
•Non-operatedjointarrangements.
•Wellincident.
•Pipelineincident.
•Marineincident.
•ReviewofeffectivenessofBP’ssystemof
internal control and risk management.*
•Quarterlygroupauditreports.
•Quarterlysignicantallegationsandinvestigationsreports.
•Quarterlyethicsandcompliancereports.
•Annualethicscertication.*
Monitoring of
operations and
reporting
External and
internal audit
Risk reviews
System of internal
control and risk
management