July 29, 2010
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3 Comments
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eam cmms

Readers of our blog will know that we are in Florida and have paid a fair amount of attention to the Gulf Oil Spill. The Gulf oil spill disaster started on April 20, 2010 with an explosion on Deepwater Horizon oil rig. It has been a hundred days since the catastrophe began. Looking back, we must all ask ourselves what was learned from this asset management nightmare.

What Happens When Maintenance is Not Done Right

The Effect of Maintenance Gone Wrong

There is no doubts at this point that the disaster was caused by a combination of under managed operations, poor maintenance policies, and a heavy dose of gambling on the part of BP that the money saved from not maintaining all the proper safety devices to prevent the gas bubble blowout, was worth the risk of life and environmental damage that an oil spill could cause.

100 Day Lowlights and Facts About the Gulf Oil Spill

  1. Day 6 – safety device that was supposed to stop the flow of oil fails.
  2. Day 19 – The first tar balls are reported on Dauphin Island.
  3. Day 29 – Almost 20% of fishing in the Gulf is stopped and oil hits the marshlands in Louisiana.
  4. Day 43 – Oil hits the Alabama coast and almost 1/3 of federal waters in the Gulf are closed to fishing
  5. Day 67 – BP shares hit a 14 year low on the New York Stock Market.
  6. Day 79 – Every State surrounding the Gulf of Mexico has reported tar balls on their beaches.
  7. Day 99 – Tony Hayward is relieved of CEO duties from BP and replaced with Bob Dudley.
  8. Day 100 – The Governor of Florida reports that 640 miles of shoreline is oiled.

    9. “Approximately 640 miles of Gulf Coast shoreline is currently oiled: 100 miles in Florida, 362 miles in Louisiana, 108 miles in Mississippi and 70 miles in Alabama… About 1.84 million gallons of total dispersant have been applied: 1.07 million on the surface and 771,000 subsea. “

    Source: thegovmonitor.com

  9. Day 100 – The impact on tourism is expected to last up to 3 years, a negative $23 Billion impact, if the oil does not move our way. The University of Florida issued a report stating that the oil is likely to head to Florida with a wind, hurricane or current change.
  10. Day 100 – BP’s costs are estimated to be over $3 billion and rising.

What Have We Learned About Maintenance Management?

The most important thing that we have learned is that we have all been reminded that maintenance management is not an option for industry. This is not new as the world has already seen its share of maintenance related tragedies when cutbacks are made to save a few dollars. We have also seen how fast an executive can lose his job (99 days) and how maintenance management really is “Pay me now or pay me a lot more later“.

It would be difficult for any business leader not to recognize that BP should have made sure that proper maintenance procedures were enforced. Sadly, history has shown us that someone is bound to make the same mistakes again because of the false belief that this could not possibly happen to them. Still, we hope this does not occur again.

Finally, we learned that maintenance management is more than just making sure work requests are being handled or work orders are completed. It is a discipline using skilled professionals dedicated to ensuring that assets are in optimal operational condition in order to obtain their maximum value. Good asset maintenance with an EAM/CMMS is the difference between a marginal bottom line and a great financial performance in a company.

What does the Future for The Gulf States look like.

Industries that have been impacted by the Gulf oil spill such as hospitality, fishing, and oil will eventually recover. Less certain is the environmental impact of the oil spill as it is just too early to tell the true damage done. For those businesses facing a revenue shortfall as a result of the catastrophe, it is important that they take this opportunity to revisit their operations and look for areas of productivity and energy efficiencies that can be garnered both now and when business returns to normal.

Marinas, hotels and lodges near the affected areas can also use this time to make sure their assets are protected from potential oil damage is the winds change. One method of doing this is to use an EAM/CMMS system to schedule the regular inspection of assets to identify early signs of oil issues. A slow period is the perfect time to organize the maintenance management function.

As for the Oil industry, now would be a good time to check maintenance management procedures and tools to make that you do not end up as the next headline.

Share with us your thoughts on how best to handle adjusting to lower tourism.

Below is a list of all our prior posts on the Gulf Oil Spill. We hope that you have enjoyed reading them:

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  • Splendoracm

    I could not agree more with the statement (pay now or pay later). The problem is who is holding the bag when the bill comes in and how much the cost increases due to legal action necessary to complete the process

  • Mdstanberry

    Unfortunately, the blatant lack of attention to maintenance and operations is pervasive. It often starts during construction, where the objective is to build it quick, build it cheap, then move on. While the result may meet building code, it is all too frequently “just enough to get by”. Ownership typically ends up in the hands of a REIT or some other institutional real estate portfolio owner. Now the objective is buy it cheap, run it cheap, sell it for an obscene profit. While some sentiment may be changing, due strictly to public pressure, we have to acknowledge the fact that we produce “disposable buildings”. They were not built to be maintained, and owners only invest in the bare minimum to keep things running. While not every incident is as visible and damaging as the gulf disaster, they occur nonetheless. I just read this morning of an apartment building collapsing during the night in Italy, killing three occupants. How does an apartment building just fall down? Was it poor design, poor construction, poor maintenance, or a combination of all? In the gulf disaster, BP may be its public face – but they are not the sole entity with culpability in the matter. I’m not sure what it will take to move us beyond pure profit motivation to one of quality, pride of workmanship, and contribution to society.

  • Chris Kluis

    @Dean – thanks for the well thought out reaction.

    It is too true that profit motivation is what causes some of these disasters, but as you alluded to that is because we do not adequately make all the stakeholders accountable for their participation.

    Your example about a building collapse in Italy; who is responsible… it could be all three, but it is almost definately maintenance fault. Proper maintenance and inspections could have shown uncovered potential issues and perhaps avoided the loss of life.

    Maintenance is critical to reducing liability for accidents. Documenting your maintenance via a useable EAM or CMMS may help push the liability to another party if you can prove that you did everything possible to keep the building/facility in good working order.