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The thin black line

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Securing the energy supply chain – from production platform to consumer – is the greatest single security task in the world, reports Gavin Greenwood

The industrial world’s near total dependence on oil and gas as its principal source of energy rests on a vulnerable, often fragile, supply chain.

Every process that extracts hydrocarbons from the earth, transports and then transforms them from their raw state into usable commodities, can be deliberately interrupted for political purpose or criminal gain.

An indication of the importance governments place on ensuring their economies receive enough energy is shown in a study published in early 2005. The report estimated that the US administration alone spent between $78 billion and $158 billion a year (calculated at the rate of the 2003 dollar) on securing its foreign oil and gas supplies.

This vast amount of money is consumed within the wider context of defence expenditure intended to preserve or restore stability in such key oil-producing regions as the Middle East and Latin America. It does not include the physical protection of oil and gas-related assets by the various producing nations, commercial companies and their sub-contractors.

Similar expenditure by other consumer and producer nations will take this figure into the high billions.

If such costing could be applied directly to retail fuel costs, it would almost certainly now exceed more than half the price a consumer pays for a gallon of petrol.

Raw power, weak links

The energy chain begins with the discovery and then extraction of oil and gas reserves. While technically the most complex stage of the process, exploration and production rigs and platforms are generally the most secure stage of the energy chain as they are either offshore or in remote areas where access can be readily monitored and controlled.

There are, of course, exceptions such as the production platforms in Nigeria’s delta provinces and exploration rigs in disputed or contested waters. Protecting these assets is usually a role undertaken by national defence forces who are trained and equipped to operate offshore.

However, a G4S subsidiary in Nigeria is providing proactive maritime protection, perhaps creating a model for further similar operations.

The movement of crude oil, refined product or gas through pipelines and into storage tanks is, by contrast, extremely vulnerable. The pipelines make obvious and often “soft” targets for terrorists intent on undermining a country’s economic base or diverting the security forces from active combat operations to a less assertive guard role.

A more universal threat to pipelines comes from the theft or vandalisation of equipment at the pumping stations and the electricity grids that provide power for the system. The illegal extraction of petroleum products from pipelines linking refineries to distribution or loading facilities poses a further security challenge.

Oil and gas tankers are threatened by terrorist attacks and criminal piracy while at sea, where their security is principally the responsibility of national governments and their military and naval assets. Such vessels require protection while being loaded and unloaded.

Personnel are “soft” targets for terrorists and political groups as well. Foreign employees are particularly vulnerable due to their dependence on often complex local loyalties and priorities. When families are involved, as for example in the large Middle East refining and petrochemical centres, the threat increases in proportion to the multiplicity of potential targets.

Power supply is another “soft” target for terrorists or political groups seeking to disrupt oil or gas production. Electricity transmission infrastructure is also attractive to thieves seeking metal or other components for sale. A major power outage, even with generators backing up key systems, can seriously disrupt operations through their impact across the spectrum of operational inputs from communications to staff absence.

Interference with administrative or logistical support can also interrupt or halt extraction, transportation and production. The loss of communications, computing power, spare parts and other crucial stores will all have a negative impact on operations and risk incurring considerable costs and contractual liabilities.

Chain reaction

Securing an energy chain that can stretch for thousands of miles involves numerous nations, agencies and organisations. Unlike many other defensive models, however, the first line of security in the oil and gas sector is often provided by commercial contractors such as G4S.

Each stage of the process of extracting, transporting, processing and storing oil and gas requires differing levels and methods of protection. Few generic models can be successfully bolted on to each stage, regardless of local conditions. Every assignment and the resources deployed demand individual threat assessments, as the failure to identify realistic risks can result in misplaced resources that may either under- or over-estimate the levels of security required.

As a result, both customer and security contractor should focus on where and how the most credible and damaging threats may be generated. As each link in the energy chain faces differing threat levels, ranging from sophisticated terrorist attacks to the theft of materials by opportunists, assessing which is the most probable at any given point or facility is the key to providing balanced and sustainable security.

The threats include:

While national military and police formations and agencies provide a degree of protection, much of the work of routinely securing the links that make up the energy chain are, and will remain, the responsibility of commercial security and guarding companies such as G4S.

Kazakhstan: Extreme challenge

More than 800 G4S security personnel now work at the Tengiz oil field in the Zhylyoi Region of Kazakhstan on the north-eastern shore of the Caspian Sea.

Tengiz is the world’s sixth largest oil field with up to nine billion barrels of recoverable crude oil and a vast amount of natural gas. It is operated by the Tengizchevroil (TCO) joint venture, comprising ChevronTexaco (50%), KazMunaiGas (20%), ExxonMobil Kazakhstan Ventures (25%) and LukArco (5%), with a concession area of over 1,000 square miles.

This huge and often barren area is also subjected to great climatic contrasts, with temperatures reaching 40 degrees C in high summer and -40 degrees C in deep winter.

G4S provides static and mobile security guards as well as running an emergency operations room. This facility, permanently staffed by multi-lingual company personnel, serves as a key link for TCO’s 8,000 or so workers and contractors, alerting them in the event of an operational crisis or handling any emergency calls from the field.

In addition to patrolling the hundreds of miles of roads and tracks that traverse the vast concession area and manning more than 20 check points, some G4S personnel have also been trained to operate monitors that check for emissions of hydrogen sulphide gas – a major and lethal threat at any working oil field.

All checkpoints are equipped with gas detectors, and G4S guards have often been the first to raise the alarm that there is a leak.

As well as providing security at the Tengiz site, G4S personnel are employed in Atyrau, the region’s administrative centre more than 200 miles north of Tengiz. One of their key tasks in Atyrau is to guard TCO’s Dostyk complex where senior company staff and their families are housed.

  This page is an edited version of the article featured in the June 2008 edition of International.
Download the full article: application/pdf The thin black line

Barracuda in Nigeria delta

Nigeria Delta Force

In 2005 senior mangers from G4S’s Global Risks team identified the support of oil companies in Nigeria’s Delta region as the most challenging task facing the company from a security perspective.

The principal threats in the region are to personnel from politically motivated groups and the theft of assets, product and equipment by organised and opportunist criminals.

In order to fulfill this complex role, Outsourcing Services Ltd (OSL), G4S’s local unit in Nigeria, has developed strategies that range from the deployment of coastal patrol boats to involvement in programmes and initiatives aimed at gaining and retaining the support of local communities living near oil facilities.

This combination of active and passive defences refined in Nigeria has served as a model for G4S operations in other complex operational environments.

The core of OSL’s operations in Nigeria is providing security support to Chevron Nigeria Ltd’s (CNL ) offand on-shore production platforms and pipelines in the Escravos region of the Delta. G4S also protects CNL ’s administrative headquarters in Warri and Lekki, as well as the company’s gas liquefaction facilities.

Much of the Niger Delta is swamp, divided by countless creeks. These offer mobility and cover to local groups who oppose CNL ’s presence on political grounds or who are involved in criminal enterprises that threaten production or personnel.

OSL employs around 600 security guards and other personnel to provide static and mobile protection to CNL . The capacity was boosted in 2007 when OSL acquired two high-speed patrol boats to serve as escorts for offshore transfers, enabling the movement of armed rapid reaction force personnel to deter those seeking to disrupt CNL ’s work.

OSL also liaises between the Nigerian security forces and CNL , a delicate task requiring a high degree of cultural sensitivity and diplomatic skills.

Indonesia: Solid Presence

G4S personnel are deployed across the entire Indonesian archipelago, which stretches some 2,500 miles from Aceh in the northwest to Papua in the east – equivalent to the distance between New York and Los Angeles.

Of the company’s 5,800 security guards and other personnel, 2,800 are employed in protecting often remote oil, gas and mining sites for clients who include most of the major foreign oil companies operating in Indonesia.

The principal current threat facing the oil and gas sector is internal theft of equipment or other materials by staff as well as illegal trespass on work sites or infrastructure, such as pipelines.

Despite Indonesia’s reputation for terrorist activity, there have been no serious attempts by such groups to attack oil and gas facilities. Separatists in Aceh had attacked foreign oil contractors’ facilities in the province, but the formal end to hostilities in 2005 removed the main insurgent threat to Indonesia’s oil and gas  infrastructure.

However, evidence of rising tension in Aceh in early 2008 serves as a reminder that underlying enmities remain. There is also minor insurgent activity in Papua, although the principal challenge in this huge province is managing the expectations and concerns of local communities facing rapid and often bewildering change.

As a result, most G4S personnel are now engaged in securing access to client work sites and administrative areas against internal and external criminal threats.

Some personnel are deployed in the more active roles of patrolling often heavily forested terrain as part of measures to detain or deter intruders around jungle exploration or production sites.

Other G4S employees are also involved in community liaison work among the local population, mediating in the case of grievances against the oil and gas companies while seeking to mitigate problems and issues before they become an obstacle to operations.