Fine upheld after offshore gas leak
Posted: 2nd November 2016
Fines imposed on companies for health and safety breaches are meant to hurt and their size in part depends on the scale and prosperity of the perpetrator. In one case, an energy company with a turnover of £4.8 billion was fined £3 million in respect of an offshore gas leak that put several workers' lives at risk.
ConocoPhillips Limitedis the UK subsidiary of an American energy corporation, which is the 'largest company of its kind in the world', was hit with the fine after pleading guilty to three breaches of the Offshore Installations (Prevention of Fire and Explosion, and Emergency Response) Regulations 1995.
The incident, in which 603 kilograms of gas leaked uncontrollably into the turbine hall of an offshore platform, had put the lives of 66 workers in jeopardy and was due to a systemic failure. All those on the plaform 'were at risk if the gas has ignited' and nearly 40 of them were removed by helicopter.
In challenging the level of the fine before the Court of Appeal, the company pointed out that there was no suggestion of profit-driven safety shortcuts having been taken. The company had cooperated throughout the investigation, had spent considerable sums rectifying the problem and had an excellent safety record.
In dismissing the appeal, however, the Court noted that the judge who imposed the fine was rightly conscious of the need for the penalty to be large enough to bring home a message to the company’s directors and shareholders. In the year ending December 31, 2014, the company's turnover was £4.8 billion so the fine was appropriate in a serious case, in terms of both culpability and potential harm, and could not be viewed as manifestly excessive. In light of the company’s size and turnover, the fine could well have been greater.