POG 360 - Managing Environmental Risk in Offshore Oil & Gas Sector

This report examines the environmental threats posed by offshore oil and natural gas operations and analyzes methods for mitigating these risks. It highlights the increasing consumption of fuel and energy, which puts pressure on the environment and society. The study identifies risk factors, evaluates the impact of offshore operations, and assesses the measures taken by organizations in the oil and gas industry. It also addresses gaps in current strategies and recommends suitable strategies for mitigating environmental hazards. The research emphasizes the importance of environmental proactivity and the integration of environmental concerns into daily operations to ensure long-term sustainability.

Running head: DISSERTATION
Dissertation
Name of the Student
Name of the University
Author Note

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Abstract
This is a study, which had highlighted the various environmental threats caused by the offshore
operations in oil and natural gas sector. Moreover, the research paper had analyzed the methods
that had already been applied by various organizations to mitigate the risk and new technological
methods that can be applied. Oil and gas industries are established all over the world and
different organization operate in different environment. There had been some differences in
policies in various organizations and the operational activities had significant impact on the
corresponding environment and the society. Thus, it is essential to take measures to mitigate the
risks of harming the corresponding environment and the study had analyzed the measures and
their implications in the managing the sustainability of the global ecosystem.

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Acknowledgement
By this research, I have experienced best possible learning of my life. By conducting this
research, I have learnt various concepts, models and theories. I first thank to the almighty God.
After that, I want to thank to my supervisor ______________ who is my friend, philosopher and
guide. I also thank my parents for being supportive and accommodative for completing this
research. I want to thank my friends for giving me the moral support while conducting this
research.

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Table of Content
CHAPTER 1....................................................................................................................................5
INTRODUCTION...........................................................................................................................5
1.0 Introduction................................................................................................................................5
1.1 Background of the research.......................................................................................................5
1.2 Aim of the Research..................................................................................................................7
1.3 Research Objectives...................................................................................................................8
1.4 Research Question.....................................................................................................................8
CHAPTER 2....................................................................................................................................9
LITERATURE REVIEW................................................................................................................9
2.0 Literature Review......................................................................................................................9
CHAPTER 3..................................................................................................................................19
RESEARCH METHODOLOGY..................................................................................................19
3.0 Research Methodology............................................................................................................19
3.1 Research Philosophy................................................................................................................20
3.2 Research Approach..................................................................................................................21
3.3 Data Collection........................................................................................................................23
CHAPTER 4..................................................................................................................................27
FINDINGS AND ANALYSIS......................................................................................................27
4.0 Findings and analysis...............................................................................................................27
4.1 Risk factors..............................................................................................................................27
4.2 Global trends and impacts.......................................................................................................30
4.3 Discussion................................................................................................................................40

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CHAPTER 5..................................................................................................................................43
CONCLUSION AND RECOMMENDATION............................................................................43
5.0 Conclusion...............................................................................................................................43
5.1 Recommendation.....................................................................................................................44
6.0 Reflection.................................................................................................................................47
References......................................................................................................................................49

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Topic: Managing environment risk in offshore operations in the oil and gas industry
CHAPTER 1
INTRODUCTION
1.0 Introduction
This is a study, which will highlight the various environmental threats caused by the
offshore operations in oil and natural gas sector. Moreover, the research paper will analyze the
methods that have already been applied by various organizations to mitigate the risk and new
technological methods that can be applied. Oil and gas industries are established all over the
world and different organization operate in different environment. There will be some
differences in policies in various organizations and the operational activities will have significant
impact on the corresponding environment and the society. Thus, it is essential to take measures
to mitigate the risks of harming the corresponding environment and the study will analyze the
measures and their implications in the managing the sustainability of the global ecosystem.
1.1 Background of the research
The recent trends in the market show that there has been a rise in the consumption of fuel
and energy in the industry. The production and consumption of fuel have increased significantly
since the year of 2013 (Griffin et al. 20014). Thus, the rising demand in the global economy will
risk the corresponding environment and society. Thus, the oil and natural gas organizations are
faced with challenges of fulfilling the energy demand by minimizing the negative impacts of its
operation on the environment. Even though, the industry has set benchmarks both nationally and

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internationally to incorporate best practices organizations but the majority of the problems faced
by the oil and natural gas industry are specific to sites, which consist of detail analysis of the
corresponidng environment, and identification of the precautionary measures as it cannot be
solved by using generalized frameworks. Thus, the organizations will have to develop their own
risk management systems so that they can mitigate the harmful effects on the environment and
society. Thus, environmental pro activity is essential, as unsustainable practices in operations
will pose serious threats to both local and global environment (Silvestre and Gimenes 2017).
Exploration of oil and gas causes threats of destroying habitats, loss in biodiversity and emission
of harmful gases in to the air.
UN report suggests that environmental damage due to corporate activities costs around
$2.2 trillion per annum and this cost is expected to rise to $28 trillion by the end of 2050
(Mendes et al. 2014). There has been rise in the emission of green house gases in to the
environment, which has increased the temperature in the atmosphere and sea level. Moreover,
the precipitation pattern has been altered due to global warming effect. Thus, it can be seen that
the operations of these oil and natural gas organization have not only threatened the quality of
the environment but at the same time has caused dramatic changes in the climatic conditions all
over the world.
Thus, environmental concerns will have to be incorporated in to the daily operations of
the organizations, as external sources have been ineffective in altering the environmental risk
valuation processes in corporate industry. Over the past decades, various environmental treaties
and frameworks have been developed for mitigating the risk of environmental degradation but
their effectiveness is limited. Thus, the major oil and natural gas organizations are facing various
challenges in offshore activities and managing environmental risks. Moreover, the national and

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global policies set by various countries are not effective and international protocols have not
been able to bring all the countries in agreement.
Thus, this study will aim to indentify standard practices, which can be used by the
organizations at a global level to mitigate the environmental hazards and risks. Bureau of Safety
and Environmental Enforcement (BSSE) are placed to monitor and regulate the offshore
activities in the oil and natural gas sector (Cordes et al. 2016). However, the rules are not
stringent enough which led to disasters such as Deepwater Horizon Spill in the year of 2010
(Cordes et al. 2016). Thus, integration of environmental risk management procedures in to the
organizations could be effective in mitigating the risk factors. The major global oil and natural
gas companies face issues in exploration and production of oil and gas. Thus, it has been
identified that the oil and natural gas organizations are facing challenges in keeping their short
term, goals in alignment with that of the long-term environmental impact. Thus, the
organizations are under immense pressure of fulfilling the goals and objectives of the
shareholders, and at the same time improving the environmental standards with the organization.
Thus, the study will be able to identify the essential measures that can be taken by the
organization to maintain the long-term sustainability in the environment (Ahi and Searcy 2013).
1.2 Aim of the Research
This study will aim to identify the methods that have been used by the oil and natural gas
organizations to manage the risk factors in offshore operations. The offshore operations by the
oil and natural gas industry will have significant impact on the marine life, which includes flora
and fauna of rare species. Moreover, hazardous events are quite frequent in this industry and the
offshore industries have experienced gruesome incidents of oil spills which has deeply impacted

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the corresponding ecology and it sustainability. Thus, the study will try to identify the various
risk factors involved in the offshore operations and how it can be mitigated by the organizations.
1.3 Research Objectives To identify the risk factors in the offshore operations in the oil and natural gas sector To evaluate the impact of offshore operations in the oil and natural gas sector To identify the measures that are taken by the organizations in the oil and natural gas
industry To evaluate the gap in the measures taken by the organizations in oil and gas industry To recommend suitable strategies in order to mitigate this research gap
1.4 Research Question What are the risk factors in the offshore operations in the oil and natural gas sector?
 What is the impact of risk factors in the offshore operations in the oil and natural gas
sector?
 What are the measures taken by the organizations in the oil and natural gas industry?
 What are the gaps in the measures taken by the organizations in oil and gas industry?

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CHAPTER 2
LITERATURE REVIEW
2.0 Literature Review
According to, Shuen, Feiler and Teece (2014), the operations related to oil and gas
industry occur in every corner of the world and within a varied range of ecosystems as well as
habitats. The operations of this industry cause a lot of pressure on the environment locally and
the people living there as well. The production as well as consumption of the various fuels has
increased a lot. The global consumption and use of fossil fuels have also risen recently more than
the production which has led to rise in pressure for gas and oil. The demands of global energy
have risen to a new height in the recent years, which has led to high levels of risk as well as costs
with respect to the environment and society as well. The gas and the oil companies have to face
the major challenge of meeting the growing needs and demands of the world population. The
challenge is mainly to meet the demands of the population and also minimize the effects that are
caused by the operations of this industry.
As discussed by, Davies et al. (2014), the industry has to follow both national as well as
international rules and regulations regarding the best ways by which the operations of the
organizations have to follow. The organizations of these industries however have to face many
different issues which are specific to some sites and they cannot be addressed by the general rule
laid by the governments. The concerns and the risks associated with the operations of the
industry can be minimized with the help of systems of managing risks and different practices
related to the operations of the industry. This can help the industry in minimizing the effects that

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it causes on the environment where they operate and the harmful incidents that can occur as well.
The organizations need to embed the environmental concerns within each and every aspect of the
daily operations, so that they gain outcomes that are beneficial for the organization. The
organizations can also avoid any type of legislation that can be imposed on them or any disasters
as well (Werner et al. 2015).
According to, Cordes et al. (2016), the proactivity related to environmental issues is
necessary for the industry as the business processes related to the organizations that are
unsustainable in nature can pose huge threats on the environment both at the global as well as
local levels. The exploration related to gas and oil industries can threaten the habitats, can cause
losses related to biodiversity and also produce air emissions that are harmful in nature. The
incidents related oil spills can cause contamination of groundwater and soil and it can also
destroy the freshwater discharges and marine life as well. As reported by the UN, the costs
related to environmental damages caused by the corporate wastes have amounted to more than
$2.2 trillion in an annual basis and the costs that have been estimated in the next few years that is
till 2050 is around $28 trillion. The greenhouse gases that are emitted in the environment
constitutes around 50% of the total amount of air pollution and the rest 50% is accounted by the
water pollution (Tietenberg and Lewis 2016). The high levels of carbon dioxide have thereby
resulted in greenhouse gases and these gases can increase the temperature of the atmosphere as
well as the sea levels.
Kadir et al. (2015), state that, the quality of environment has been constantly threatened
by the oil operations of the multinational companies and have caused changes to conditions of
the habitat that has been exploited. The changes in the habitats have affected the lifestyles and
traditional cultures of the local populations of these areas. The use of land for the purpose of

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fishing, agriculture as well as hunting and logging has changed a lot due to the exploitation of the
resources. The health of the society and the safety of the environment is highly integrated with
the nature and this has posed consequences to the humanity that are dangerous in nature. The
companies related to oil and gas need to improve the ways by which they operate and their
practices and objectives as well so that the negative effects on the environment can also be
reduced.
As discussed by, Kark et al. (2015), the organizations that are operating in this industry
need to incorporate the concerns related to the environment into their daily operations. The
integration of procedures related to environmental risk management can help in minimizing the
challenges related to production of gas and oil. The ways of combating the issues related to
environment with the help of the foreign and domestic legislation has not been quite successful
for the companies. The environmental goals need to be a major part of the business goals of the
organizations. The internal values of the employees of the organizations need to be aligned to the
external views of the organization. The organizations or oil companies can gain a lot from the
ways of adjusting the process of decision making so that higher emphasis is placed on the
preventive measures.
According to, Ronconi, Allard and Taylor (2015), the risks related to the environment are
highly unpredictable in nature and this major challenge for the oil and gas companies as they
cannot precisely predict the effects of these environmental issues. The organizations need to face
the huge challenge of aligning the short-term related to financial benefits with the long-term
goals of the organizations related to environment. The organizations need to deliver returns that
are high to the shareholders as well as look after the social good. The image of the organization
also needs to be managed so that the internal values are related to external operations. The