Xstrata Coal’s New South Wales division launched an innovative core hazard assurance process in 2006 that acts as a tool to educate employees about critical risk controls, increase individual accountability and provide assurance to senior management that effective controls are in place.

The initiative was implemented by Xstrata Coal’s New South Wales operations, comprising 12 mines, after critical and high potential risk incident data from around Xstrata’s global operations highlighted the need to ensure catastrophic risks were being managed appropriately on a consistent basis. The response was to design a thorough system that assures the implementation and integrity of risk controls to augment existing management systems.

The first step was to review risks on a site-by-site basis to identify catastrophic and high risk areas that could potentially lead to single or multiple fatalities. These were defined as core hazards. A total of 12 catastrophic and 11 high risk core hazards were identified in this process. They included events such as strata failure, explosion, fire, vehicle and pedestrian interaction, an in-rush of water or gas, energy isolation and working at height.

A key component of the system design is accountability. Each identified hazard at each site is checked by an accountable individual, who is responsible for making sure the risk controls are being implemented correctly. On a regular basis, this individual is required to report how the controls are being implemented. For example, a coal mine ventilation shaft with an underground gas detector requires testing and calibration on a regular basis. As a key risk control measure, the process owner is accountable for confirming that all tests occurred as planned and the monitoring and alarm system is fully functional.

The reporting system elevates through the Operations Manager, General Manager, Chief Operating Officer up to the commodity business unit CEO. The reporting process functions ‘by exception’, meaning only matters of issue are reported to a higher level of management. In this manner, managers are provided a level of assurance of the status of controls to prevent potentially high consequence events and are better informed on issues relating to failures of controls.

An auditing process complements the assurance system, with each risk control audited for both quality and effectiveness. The audit process occurs on a quarterly basis and rotates through the key hazard controls to ensure each one is reviewed at least every three years.

The system has been in place since February 2006, and a review of the first year’s activities included a four-day workshop with managers and representatives of operating mines. Their feedback is being incorporated into the system to achieve further improvements and to streamline the process.

Mick Buffier, Chief Operating Officer of Xstrata Coal NSW, said: “While there were initial concerns about the additional workload created by the assurance process, sites and management are now extremely supportive. The assurance process is truly delivering a safer workplace and at the same time providing reassurance that the controls that are supposed to be in place are in fact in place and effective.”

Critical controls are currently being developed for each of the seven Core Risks identified as common to all Xstrata Coal divisions, to allow consistent reporting on a quarterly basis and provide assurance to the Xstrata Coal HSEC Committee.