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Esso/Longford 1998 Gas Explosion

The current issues and the incidents ongoing from 2008 bear all the hallmarks of another Longford disaster like the one that occurred in 1998 when a catastrophic explosion at the plant during the morning of Friday 25 September 1998 killed two workers in the accident and injured eight others. 

Background

In 1998, the Longford gas plant was owned by a joint partnership between Esso and BHP. Esso was 
responsible for the operation of the plant. Esso was a wholly owned subsidiary of US based company Exxon, which has since merged with Mobil, becoming ExxonMobil. BHP has since merged with UK based Billiton becoming BHP Billiton.

Built in 1969, the plant at Longford is the onshore receiving point for oil and natural gas output from
production platforms in Bass Strait. The Longford Gas Plant Complex consists of three gas processing plants and one crude oil stabilisation plant. It was the primary provider of natural gas to Victoria, and provided some supply to NSW.

Aftermath

The fire at the plant was not extinguished until two days later. The Longford plant was shut down 
immediately, and the state of Victoria was left without its primary gas supplier. Within days, the Victorian Energy Network Corporation shut down the state's entire gas supply. The resulting gas supply shortage was devastating to Victoria's economy, crippling industry and the commercial sector (in particular, the hospitality industry which relied on natural gas for cooking). Loss to industry during the crisis was estimated at around A$1.3 billion.

As natural gas was also widely used in houses in Victoria for cooking, water heating and home heating, many Victorians endured 20 days without gas hot-water or heating.

Gas supplies to Victoria resumed on 14th October, 1998

The Longford Catastrophe: What Price Safety?

A Royal Commission was called into the explosion at Longford, headed by former High Court judge Daryl Dawson. 
The Commission sat for 53 days, commencing with a preliminary hearing on 12 November 1998 and concluding with a closing address by Counsel Assisting the Royal Commission on 15 April 1999.

Esso blamed the accident on worker negligence, in particular, one of the panel workers on duty on the day of the explosion.
The findings of the Royal Commission, however, cleared the panel worker of any negligence or wrongdoing. Instead, the Commission found Esso fully responsible for the accident:

The causes of the accident on 25 September 1998 amounted to a failure to provide and maintain so far as practicable a working environment that was safe and without risks to health. 
This constituted a breach or breaches of Section 21 of the Occupational Health and Safety Act 1985

Other findings of the Royal Commission included:

  • the Longford plant was poorly designed, and made isolation of dangerous vapours and materials very difficult;
  • inadequate training of personnel in normal operating procedures of a hazardous process;
  • excessive alarm and warning systems had caused workers to become desensitised to possible hazardous occurrences;
  • the relocation of plant engineers to Melbourne had reduced the quality of supervision at the plant;
  • poor communication between shifts meant that the pump shutdown was not communicated to the following shift.

Certain managerial shortcomings were also identified:

  • the company had neglected to commission a HAZOP (HAZard and OPerability) analysis of the heat exchange system, which would almost certainly have highlighted the risk of tank rupture caused by sudden temperature change;
  • Esso's two-tiered reporting system (from operators to supervisors to management) meant that certain warning signs such as a previous similar incident (on 28 August) were not reported to the appropriate parties;
  • the company's "safety culture" was more oriented towards preventing lost time due to accidents or injuries, rather than protection of workers and their health.

Legal ramifications

Esso was taken to the Supreme Court of Victoria by the Victorian WorkCover Authority. The jury found the company guilty of eleven breaches of the Occupational Health and Safety Act 1985, and Justice Philip Cummins imposed a record fine of $2 million in July 2001.

In addition, a class action was taken on behalf of businesses, industries and domestic users who were financially affected by the gas crisis. The class action went to trial in the Supreme Court on 4 September 2002, and was eventually settled in December 2004 when Esso was ordered to pay $32.5 million to businesses which suffered property damage as a result of the incident.

Following the Longford accident, Victoria introduced the Major Hazard Facilities Regulations to regulate safety at plants that contain major chemical hazards. These regulations impose a so-called "non-prescriptive" regime on facility operators, requiring them to "demonstrate" control of major chemical hazards via the use of a Safety Management System and a Safety Case.

Some recommendation responses relevant to now:

  • In its recommendations, the commission report said that Esso should be required to evaluate the design of critical areas of Longford and to show that its operating standards, practices, and policies are periodically reviewed.
  • And it suggested that a new government authority be formed to administer safety audits for all major-hazard facilities in Victoria

The royal commission also found that the Victorian government had failed to enact legislation requiring Esso to complete a safety report identifying the relevant hazards of the plant in line with national safety standards for such plants.
Victorian Premier (at the time), Jeff Kennett, responded by saying that his government would consider the commission`s recommendations for legislative action to extend safety case reporting procedures to all major hazardous facilities in the state. And the government would examine the establishment of a specialist agency to monitor and administer those safety procedures.

Read - THE NEXUS BETWEEN REGULATION ENFORCEMENT AND CATASTROPHIC ENGINEERING FAILURES

'Failure to enforce regulation was a common factor in the deaths caused by the 1999 Turkish earthquake, 2001 Indian earthquake, the 1997 Canberra hospital implosion and the 1998 Esso Longford gas plant explosion. In each case, regulations existed but they were not followed nor enforced.

Over the last 2 decades, the trends of de-regulation and self-conformance have effected most engineering activities in Australia and around the world. These trends have the potential to reduce costs, increase innovation and benefit the nation. But they also may lead to a decline in design quality, a failure to apply relevant codes and an increase in
safety risks for the community.'

Community Over Mining exists and is justified in its goal for Mining Reform because we have not learnt and unless the Victorian Premier, Dennis Napthine and his government's new department of State Development, Business and Innovation (DSDBI) ensure that industry and their own govt depts operate within the law, our communities will continue to be impacted.

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