An international equipment reliability controversy has arisen, this week, in the oil and gas sector as Australian firms have decided to continue offshore drilling operations despite suggestions that faulty machinery may put projects, and the environment, in peril.

An international equipment reliability controversy has arisen this week in the oil and gas sector as Australian firms have decided to continue offshore drilling operations despite suggestions that faulty machinery may put projects, as well as the environment, in peril.

According to The Australian, the saga centers on a GE-manufactured machine component known as an H4 connector. The U.S. Bureau of Safety and Environmental Enforcement (BSEE) recently identified this bolt as a contributing factor in three separate blowout preventer failures. As a result, six rigs operating in the Gulf of Mexico were ordered to halt operation and replace the faulty component before machines were returned to the field.

Nevertheless, several Australian firms operating rigs that incorporate H4 Connectors have decided not to postpone or scale down operations. Instead, they are entrusting tension monitoring tools to alert engineers to any possible issues while project managers wait for a more commercially convenient time to make necessary upgrades.

Differential regulation
The fast and forceful intervention of BSEE regulators in the Gulf of Mexico is to be expected. The Deepwater Horizon disaster of 2010 is still fresh on the minds of industry professionals, with Transocean accepting partial culpability in a guilty plea filed just this week. By comparison, the Australian oil and gas sector subscribes to more of a self-policing model.

"Under the commonwealth offshore regulatory regime, the offshore industry is responsible for managing risks to safety and the environment to a level that is as low as reasonably practicable," a spokesman for Australia's National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) told The Australian.

Regardless of how proactively government offices enforce preventive and predictive maintenance best practices, operators should be aware that their diligence in this area is highly predictive of their commercial prospects as well as their environmental stewardship.