ConocoPhillips invests significant resources and provides focused attention to continually improve our process safety culture and performance across the entire company. How do we define process safety? Process safety refers to the control of process hazards in a facility with the potential to impact people, property or the environment. Process safety is the prevention, control and mitigation of unintentional releases of hazardous material or energy from primary containment.

The foundation of our successful process safety management program is promoting employee participation. At ConocoPhillips, our employees:

• Have defined safety roles and responsibilities at all levels;
• Serve as employee representatives on joint health and safety committees;
• Participate in process hazards analysis, which is the identification, control and mitigation of hazards before they occur;
• Provide operator input and exhibit ownership of process startup/shutdown procedures and emergency procedures;
• Participate in safety qualification and training programs;
• Are empowered with the right and responsibility to stop unsafe work;
• Perform work permitting and pre-job hazard analysis; and
• Participate in safety, technical and procedural reviews, incident investigations, audits and emergency response teams.

Process safety performance at ConocoPhillips is continually tracked to monitor performance strengths and assess any opportunities for improvement across key business areas. This monitoring includes a strong emphasis on process safety auditing to validate and support metric data. ConocoPhillips has adopted additional process safety metrics across key business sectors and will collect and report those metrics beginning in 2011. These are based on the framework of the new American Petroleum Institute (API) Recommended Practice (RP) 754 “Process Safety Performance Indicators for Refining and Petrochemical Industries,” and on the new International Association of Oil & Gas Producers (OGP) “Asset Integrity (AI) – Key Performance Indicators.” These metrics are intended to provide management with additional tools to evaluate the effectiveness of our risk control barriers in preventing or mitigating unplanned losses of containment. Analysis of metric results helps direct specific improvement measures, which may include changes in engineering design, operating and maintenance procedures, and training opportunities.

Our ConocoPhillips Upstream asset and operating integrity programs address the prevention, control and mitigation of unintentional releases from our facilities and equipment. These programs address process safety, and focus on the proactive identification and management of hazards within our operations by defining the standards we use, measuring and auditing our performance, continuously improving our management systems, and enhancing the applied technology.

ConocoPhillips has reviewed the company’s global exploration and production (E&P) pipeline inventory to validate a register of critical lines to help ensure risks are identified and safely managed. In addition, we have engaged in a multiyear program of conducting internal inspections and hydrostatically testing approximately 10,000 miles of our regulated, company-operated E&P pipeline systems. These assessments were approximately 98 percent complete at the end of 2008, and the remainder of the mainline system was assessed in 2010.

ConocoPhillips Refining employs a robust Operating Excellence program to ensure integrity of our refining assets and operations. Refining has completed a two-year in-depth process safety and mechanical integrity evaluation at the 12 U.S. and three international refineries that we operate. Currently, Refining has embarked on a second round of focused evaluations. These assessments provide additional confidence in the effective implementation of our process safety programs and identify opportunities to improve the standards and processes in place to prevent incidents. Through mid-2010, our Refining process safety event rate was better than the industry average reported for 2009 to the American Petroleum Institute. Additionally, all of our company-owned refineries participate in a peer-assist program in which technical experts and other employees inspect other plants and share best practices.

ConocoPhillips Transportation continues to evaluate and ensure continuous improvement in process safety for our pipeline, terminal, truck, rail and marine operations. The current focus is on process hazards analysis revalidations and integrity management. Pipelines and Terminals have completed the first of a two-year intensive process safety and mechanical integrity evaluation for all pipeline systems and terminals. Through this continued focus on process safety, Transportation has experienced only one process safety incident in 2010.
ConocoPhillips will continue to benchmark process safety event rates actively against industry peers, with the ultimate goal of zero process safety events.