Cost of poor hydrocarbon process safety tops $34bn 21 March 2014

Combined losses from the 100 largest accidents in the hydrocarbon industry are now estimated at more than $34 billion, according to insurer Marsh.

The data was published in its 'The 100 Largest Losses 1974-2013 Large property damage losses in the Hydrocarbon Industry 23rd Edition'.

Marsh's energy loss database holds almost 10,000 records of losses spanning more than 40 years.

The losses are dominated by the upstream (34%) and refining sectors (29%), with the petrochemical sector accounting for nearly a quarter of losses (23%).

The gas processing and distribution sectors account for over one-in-six of the losses (95 and 5% respectively.

Marsh reports that eight new losses have entered the top 100 category since 2011, including the Sendai refinery in Japan, the Geismar petrochemical facility, Louisiana, and La Plata refinery, Ensenada in Argentina.

The Piper Alpha Disaster, in the North Sea, still tops the list, with losses estimated at $1.8bn, followed by the Pasadena petrochemical plant explosion, in Texas, which incurred losses of $1.4 billion.

"Marsh's latest report is another stark reminder of the sheer scale of financial loss resulting from process safety incidents," comments Andrew Furlong, IChemE's director of policy and communication.

"In reality, the financial loss is even greater, with 10,000 incidents recorded by Marsh over the past 40 years," he continues. "In 2014 there are sobering anniversaries of major disasters from recent decades, including Flixborough, Bhopal and Exxon Valdez."

The hydrocarbon industry is playing a leading role at Hazards 24 (7—9 May 2014 at Scotland's Edinburgh International Conference Centre), organised by the Institution of Chemical Engineers (IChemE) – widely regarded as the world's leading process safety event for the chemical and process industries. Speakers from include representatives from BP, Shell and Oil and Gas UK.

"It is the elimination of loss of life and serious injury that should be the priority of everyone in the chemical and process industries," comments Furlong.

"With over 100 recorded accidents so far in 2014, resulting in over 400 deaths and injuries, we all need to do more to improve safety for everyone involved in these hazardous but vital industries."

Brian Tinham

Related Companies
Institution of Chemical Engrs
Marsh Ltd

This material is protected by MA Business copyright
See Terms and Conditions.
One-off usage is permitted but bulk copying is not.
For multiple copies contact the sales team.