27 March 2008

British Health and Safety Executive extends safety notices on Maersk oil field.  No date for start-up of production.

Maersk Oil UK is paying the price for poor safety procedures in the North Sea.

In November 2007 the British Health and Safety Executive (HSE) closed down Maersk’s Janice oil field on safety grounds. There is still a prohibition notice on the field and it is uncertain when production will resume.

Michael Engell-Jensen, Managing Director of Maersk Oil UK, told the Danish 3F newsletter: “Janice should be producing between 5,000 and 10,000 barrels of oil every day at the price of US$100 before taxes. So it’s obviously a financial setback. It’s not very popular.”

 A.P. Moller-Maersk’s annual report recognised an impairment loss of $92 million in respect of production assets at the Janice field last year.

In November 2007 the HSE referred to more than 40 areas on Janice where maintenance was outstanding. It served Maersk with three improvement notices. Two of these were to be completed by March 1, but after a request from Maersk Oil the notices were extended to April 30, according to Jennifer McGilvray, press officer of the HSE.

In one notice the HSE instructed the company to develop “a positive health and safety culture both on the installation and among its onshore management team”. There is a third improvement notice to be completed by June 1.

Michael Engell-Jensen of Maersk Oil has issued a statement saying that production in the field will remain closed until all safety work has been completed satisfactorily.

In 2006 and 2007 Maersk received twelve notices from the HSE. Two of these were immediate prohibition notices.