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G.A.T.O.R. GULF COAST – ACTION – TEAM – OBSERVING – RISK Cambridge Center for Behavioral Studies Accreditation Application Copyright © 2006 by the Cambridge Center for Behavioral Studies. All rights reserved. 1 This Application is for the Halliburton – Gulf of Mexico – GATOR – Gulf Coast – Action – Team – Observing Risk – Principals of Behavioral Based Safety Process Accreditation through the Cambridge Center for Behavioral Studies. This application follows the on-line standards outlined in PBBS Application Kit 1.0 and PBBS Accreditation Standards 1.0. We hope through the CCBS Accreditation Process to gain three valuable pieces of information. 1. To have an unbiased review of our process and to reinforce to the GATOR Steering Committee and Halliburton Corporation that we are taking the right steps to achieve our goal of Every Employee Goes Home Safe. 2. To learn how to tap into the potential of our GATOR BBP process, in the effort to achieve our goal of Every Employee Goes Home Safe quicker. If the wheel has already been invented, we want to learn from it and see if it applies to our dynamic industry. 3. This Accreditation Process will also show us some concerns in what we are doing. We want to alleviate these concerns before they become unmanageable and hinder the efforts of GATOR BBP. A. Identifying Information Name of the Organization – Halliburton Gulf of Mexico NWA – GATOR BBS Location of Corporate Office – 110 Capital Drive – Lafayette Louisiana (Gulf of Mexico Operations) Houston Texas – Global Headquarters for Halliburton Energy Services Division. Name of company representative in charge of the application. Chris Schafer Phone Numbers of the representative – Office – 337.266.8265 Cell – 337.849.6014 Address of the Representative – 110 Capital Drive – Lafayette, Louisiana 70508 E-Mail address of the representative – [email protected] B. Background Conditions in the Company Halliburton

This Application is for the Halliburton – Gulf of Mexico ... · Halliburton is a world wide company employing approximately 90,000 employees providing services to most every country

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G.A.T.O.R. GULF COAST – ACTION – TEAM – OBSERVING – RISK Cambridge Center for Behavioral Studies Accreditation Application

Copyright © 2006 by the Cambridge Center for Behavioral Studies. All rights reserved.

1

This Application is for the Halliburton – Gulf of Mexico – GATOR – Gulf Coast – Action – Team – Observing Risk – Principals of Behavioral Based Safety Process Accreditation through the Cambridge Center for Behavioral Studies. This application follows the on-line standards outlined in PBBS Application Kit 1.0 and PBBS Accreditation Standards 1.0. We hope through the CCBS Accreditation Process to gain three valuable pieces of information.

1. To have an unbiased review of our process and to reinforce to the GATOR Steering Committee and Halliburton Corporation that we are taking the right steps to achieve our goal of Every Employee Goes Home Safe.

2. To learn how to tap into the potential of our GATOR BBP process, in the effort to

achieve our goal of Every Employee Goes Home Safe quicker. If the wheel has already been invented, we want to learn from it and see if it applies to our dynamic industry.

3. This Accreditation Process will also show us some concerns in what we are doing.

We want to alleviate these concerns before they become unmanageable and hinder the efforts of GATOR BBP.

A. Identifying Information Name of the Organization – Halliburton Gulf of Mexico NWA – GATOR BBS Location of Corporate Office – 110 Capital Drive – Lafayette Louisiana (Gulf of Mexico Operations) Houston Texas – Global Headquarters for Halliburton Energy Services Division. Name of company representative in charge of the application. Chris Schafer Phone Numbers of the representative – Office – 337.266.8265 Cell – 337.849.6014 Address of the Representative – 110 Capital Drive – Lafayette, Louisiana 70508 E-Mail address of the representative – [email protected] B. Background Conditions in the Company

Halliburton

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Halliburton is a world wide company employing approximately 90,000 employees providing services to most every country in the world. Halliburton Company has two main sub-companies, Halliburton Energy Services (HES) and Kellogg, Brown and Root (KBR). KBR is primarily a heavy construction company and HES provides services to the oil and gas industry. HES breaks down its work areas in to Natural Work Environments (NWA), the Gulf of Mexico NWA is one of many NWA’s. An NWA is composed of many product service lines (PSL) to the oil and gas industry, but all of the PSL’s report to the NWA leadership. The HSE department in the Gulf of Mexico covers all of the NWA- every PSL follows the same HSE policies and reports to the HSE Operations Manager in the Gulf. In the Gulf of Mexico – GATOR is only involved in our Energy Services Division, all numbers provided in employee headcounts, facilities, and locations are representative of the Energy Services Division only.

Gulf of Mexico NWA

At a Glance

The Gulf of Mexico NWA is Halliburton’s largest NWA. We have 2182 employees and cover 43 facilities. Geographically our area is the smallest NWA covering south Louisiana and eastern coastal Texas. We provide oil and gas services for our customers in the entire Gulf of Mexico waters, inland waters (marches, swamps) and land oil and gas wells. We have approximately 750 vehicles and a fleet of marine vessels to aid in our service delivery. The Gulf of Mexico operations are the most diverse operations that Halliburton has world wide, we are the proving ground for new technology and new procedures for our world wide operations. I have a personal motto in working for the Gulf of Mexico Operations “We Set the Standard for others to Follow”

Product Service Lines At a Glance

Fluids Division - With in the last 2 months we have combined Baroid and Cementing into a new Fluids Division. This was done in an effort to stream line operations, Baroid and Cement across the GOM share many of the same facilities and operating standards. Baroid- Baroid PSL provides drilling fluid services to the oil and gas field.. The drilling fluid or completion fluid keeps the oil well under control until the well is completed. Baroid has 396 employees that range from engineers to employees that deliver the Baroid services on a well location. Baroid also has two grinding plants in our NWA. These plants grind up raw material under API standards and packages the Baroid Product.

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Baroid was an acquired in the late 1990’s through the acquisition of Dresser Industries. The data presented for this accreditation for 1999 and 2000 may not be true and representative of the incidents and injuries to the Baroid Employees. The standards to which we report in the Halliburton Organization is very strict and to the letter of the law, companies acquired through mergers usually takes a year or two to get accustomed to our standards for reporting of incidents. Cement- Cement PSL provides cementing services to the oil and gas industry. Once a well is drilled, a customer runs steel conduit to produce the well, the steel conduit is cemented in place by our Cementing PSL. Cement PSL has 300 employees. Halliburton’s history started as the world leader in cementing technology 85 years ago by our founder Erle P. Halliburton. Summary of Fluids Division- Baroid and Cement are the largest PSL’s in the GOM Operations. Most of their 25+ facilities are coastal facilities varying from 1 to 25+ employees. Baroid has 2 grinding plants that fall under MSHA Regulations and are considered surface mines, though the product is not mined at these 2 facilities, the product is received in large ocean cargo ships and is only ground into powder and shipped to customers. All other PSL fall under OSHA regulations. Completions and Reservoir Optimization Division – CRO – Within the last 4 months we have combined the Completion Products and Services - CPS and Tools, Testing and Tubing Conveyed Perforating – TTTCP, PSL’s into CRO. These 2 PSL’s were combined together in an effort to stream line services and deliverables to the customer. Completion Products and Services (CPS)- Once a well has been cemented, the customer needs a completion plan to optimize oil and gas production. This PSL designs the completion plan and then implements the completion plan for the customer. CPS has 185 employees ranging from engineers to front line employees that carry out the completion plan on location. Tools-Testing & Tubing Conveyed Perforating- TTTCP primarily provides any type of tool that can be attached to a drill string to provide a service to an oil or gas well. TTTCP also explosively perforates an oil or gas well once it has been cased and cemented to bring the well on line. TTTCP employees 127 employees in the Gulf of Mexico. CRO Division Summary- With the combination of CPS and TTTCP, CRO is the second largest PSL in the GOM. The services that they provide to our customers is very technologically driven, but required a large force of well trained location service providers. Sperry Sun- Sperry does formation evaluation and direction surveying while drilling an oil well. Sperry Suns tools are attached to the drill pipe and while drilling capture instantaneous information about the formation that a customer can utilize to make

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decisions. Many of Sperry Sun services involve radioactive materials. In addition wells are often “not straight”, but require the hole to be steered to get to an oil or gas trap – this service is the directional drilling aspect of Sperry Sun. Sperry Sun Sperry Sun has 297 employees in the Gulf of Mexico. Sperry Sun was acquired in the late 1990’s through the acquisition of Dresser Industries. The data presented for this accreditation for 1999 and 2000 may not be true and representative of the incidents and injuries to the Sperry Sun Employees. The standards to which we report in the Halliburton Organization is very strict and to the letter of the law, companies acquired through mergers usually take a year or two to get accustomed to our standards for reporting of incidents. Production Enhancement Division- (PE)- Production Enhancement as the name implies enhances existing producing wells. PE composed of four distinct separate services. FA/SC – Frac Acid and Sand Control – Provides services to fracture a formation to optimize production, and controlling the sand that can be produced from a deteriorating formation. FA/SC has 108 employees based out of 2 camps. One camp located at Port Fourchon has the 2 most technologically frac boats in the GOM. The camp in New Iberia primarily serves land and inland water operations. CT – Coil Tubing – Uses rigid steel tubing that is rolled on a drum to deliver services in wells that are highly deviated. Coiled Tubing has 55 employees located in one camp. N2 – Nitrogen – utilizing nitrogen to stimulate wells – Nitrogen has 20 employees primarily out of one location. HWO Hydraulic Work Over – a service to provide maintenance to existing wells. HWO has 20 employees primarily out of one camp. Production Enhancement Division Overview - Together the 4 sub-PSL provide some of the most physically demanding jobs in the oil field. PE does not have one divisional manager instead each sub-PSL operates under separate management, together there are over 200 employees in PE that are stationed out of 5 locations. Logging and Perforating – (L&P) Logging PSL provides services to determine where and if the oil and gas reserve is going to produce. Logging provides Seismic, Reservoir Evaluation, Perforating of the oil well to make it produce, and post well completion services to our customers. Many of the services that are provided by L&P involve explosives and radioactive material to aid in reservoir determination or bringing the well on line. L&P employees 153 employees, stationed out of one camp. Note: This is the PSL that I was hired onto and worked in for 6.5 years before become the GATOR Facilitator. I was originally the L&P Steering Committee Representative. Integrated Solutions- (IS-HDS-Landmark Digital Services) This PSL provides on site consulting services for field operations at a customers request. IS also does well

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decommissioning HDS (Halliburton Decommissioning Services)- capping wells that no longer produce. Landmark Digital Services is primarily providing geophysical data to our customers to optimize Oil and Gas reservoirs. IS has 49 employees. IS is not presented graphically because they have 5 years of 0 Total Recordable Incident Rate. Primarily IS works out of one camp. Miscellaneous Support- This includes our Maintenance department, our procurement and materials department, and a pool of engineers that are utilized by PSL’s, Maintenance has 79 employees that are at all large facilities. Procurement and Materials is the logistics and warehouses, with some internal services to other PSL’s. P&M has 57 employees which are stationed at large facilities. Security DBS – (SDBS) – This PSL builds the drilling bits that drill an oil well. In the Gulf of Mexico they have 19 employees. SDBS is not presented graphically because they have 5 years of 0 Total Recordable Incident Rate Wellnite- An nitrogen service provider to the oil and gas industry. They have 20 employees in the Gulf of Mexico. Wellnite is not presented graphically because they have 5 years of 0 Total Recordable Incident Rate ESG Management – (ESG) Energy Services Group, this is composed of the divisional VP, the Operations Managers of the PSL’s and the support staff to those managers. Finance- Accountants, Billing, Payroll etc. Human Resource- (HR) – Works with our employees to ensure we provide our services in an ethical professional manner. HR is not presented graphically because they have 5 years of 0 Total Recordable Incident Rate Information Technology- (IT) The support group for all computers and technology. This will not be counted as a separate PSL in 2005 reporting – they will be rolled into Miscellaneous Support Functions. IT is not presented graphically because they have 5 years of 0 Total Recordable Incident Rate Business Development- (BD) – Business Development is our sales force in the Gulf of Mexico, we have 127 employees dedicated to one on one solution providing for our customers needs. Other PSL- This PSL composed of our dock workers on the coast, running cranes, loading/unloading trucks and boats for the people who utilize our docks. This PSL will not be in 2005 data- the employees will be accounted for in other PSL’s

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C. Description of the Workers by PSL Training Due to the size of our workforce – it would be difficult to describe in detail each of our product service lines, instead I will describe generally the workforce with respect to PSL’s. For the most part the oil and gas industry is a male workforce, and proud of overcoming the challenges associated with the work that they do. The physical aspect of our industry, long hours, being a “dirty job” does not lend to women being too interested in pursuing a career in the industry. Women seam to pursue engineering and support of operations, and are paramount to our industry. All GOM Employees are extensively trained, we have to be, we work in an extremely demanding environment. An Example : During pre-hire – an employee goes through a 2 hour physical exercise in which an employee has to work 15 minutes overhead on a ladder, has to carry 100 pounds 25 feet then turn around and walk it back etc. Employees have to show the physical aptitude before they can be hired on. In addition an employee may not be able to go onto a customer’s location without six months experience in their current assignment. This practice is recognized by most of the majors in the Gulf of Mexico. Below is a course description of New Hire Training that every employee receives once hired. New Hire Training is one week long. Subject First Day Time/Hrs 1. Halliburton Benefits (presented by Human Resource) 08:00 2. Break 3. Introductions and Welcome to Halliburton

Film: A Halliburton Story, discuss when Halliburton began and through the Present

4. Break 5. Safety Film: I chose to look the other way 6. Lunch 12:00 7. Risk Analysis / Job Safety Analysis 13:00 8. Break 15:00 9. Personal Protective Equipment & Video 15:15 10. Rigging Safety (End of day one) 16:15

Second Day

Subject Time/Hrs

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1. Hands on rigging training 2. Frac Tank Ventilation Training (Show Equipment outside) 08:00 3. Break 09:00 4. Hazardous Material (HM-126F) ( Video) 09:10 5. Break 10:30 6. Confined Space Entry (Case History Video) 10:45 7. Lunch 11:45 8. Lockout / Tagout (Piper Alpha Video) 13:00 9. Break 15:30 10. Fall Protection (Fall Arrest Systems Video) 15:45 11. Assign Homework (End of day Two) 17:00

Third Day

Subject Time/Hrs

1. Remember Charlie Video 08:00 2. Break 09:00 3. Environmental Awareness(MMS All washed up Video) 09:15 4. H2S( A Matter Of Life And Death) 10:30 5. Lunch 11:45 6. Respirator Safety(Respirator Video) 12:45 7. Explosive Safety Awareness 13:45 8. Break 15:45 9. Radiation Densometer End – User (Video) 16:00 Assign Homework & Discuss Home Work 16:45

Fourth Day

Subject Time/Hrs

1. Basic Nitrogen Safety( Nitrogen Demands Your Respect) 2. Pressure Testing 3. Employee Customer Service Workshop 4. Handout Course Evaluation and Passport Booklets.

Fifth Day

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Subject Time/Hrs

1. Water Survival Training 07:00 All new employees must complete Ilearn modules the week before or the week after new hire training. A copy of the certificate must be sent to the Gulf Coast Learning Center to be placed in the employees file. Ilearn modules to be completed: Forklift Safety Blood borne Pathogens Back Safety Ergonomics Defensive Driving Hearing Conservation Substance Abuse Fire Safety Hazard Communication Electrical safety

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iLearn is a computer based training application. Each employee is assigned learning requirements based upon their job title and PSL duties. Each employee is required to keep up on their safety learning requirements, if not they may not be able to perform services for customers. To work in the GOM employees must have all safety requirements fulfilled by industry standards. Each PSL also has advanced schools to teach the employees their job duties with respect to the job task. My basic Logging and Perforating School was 10 weeks long. GATOR Training

Observer Class Any Halliburton Employee in the GOM can be trained to become a GATOR Observer, from receptionist to a Divisional VP. Observer training is voluntary – though some PSL’s have seen such value in employees just taking the class, routinely we get feedback to employees saying they look at risk totally different after taking the class, that certain PSL’s have mandated training but not the observations – those are still voluntary. The Observer Class is taught at operational facilities – I go to them. The reason for this being brought to them is two fold, 1. It minimizes the exposure to the risk of driving if one person goes to them instead of 20 people driving to a central location away from their area of operations, and 2. At the end of class there is an observation practical. This is where the class watches me perform a valid observation at the operational facility – we break they ask any last minute questions, then they break up into pairs of two’s and perform their first valid observation. We then meet back in the classroom and I review each observation form offering up coaching to them. A syllabus of the GATOR Observer Class Value Moment GOM GATOR Rollout Presentation Observer Manual Sec 1-3 BST Movie #1 – Fundamentals of BBP Observer manual Sec 4 - Critical Behavior Checklist Observer Manual Sec 5 – Barriers to Safe Operations Observer Manual Sec 6 – Writing Comments Based on Observed Behaviors

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Observer Manual Sec 7 – Performing Observations BST Movie #4 Observations and Feedback Observer Manual Sec 8 – Generating Feedback to Observed Behaviors Observation Practical Course Pluses / Deltas Observer Class is an 8 Hour class – employee training for BBP is captured in their iLearn Training Requirements.

This is our Critical Behavior Checklist – this is our GATOR Observers Primary Tool when performing an observation. How to use this is taught in the Observer Class. We have several different observation forms, all of which will be provided to you in the site visit. Though the format of the form is different in the four variations – the content is the same. This form is developed out of previous incidents and injuries for Halliburton in the GOM. Every two years we form a new Steering Committee – their first task is to review every injury and incident for the previous two years, out of this incident review is how we develop the CBC . This is a very powerful tool for our process, it focuses our observation and feedback potential on the 94% behavioral causal factors of incidents and injuries in the GOM. The one page CBC – above – Observers that do not have access to email like this form because it is easy to fax to a coach or steering committee member from a remote location or customers location. The Tally Book Version – Every Oil Field person carry’s a tally book – it is the same form above except the front is the left third of the form above – the back is the center third – an the reference sheet – right third- is the hard backing that holds the tablet in the tally book.

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Four Page Electronic Version – For those employees that do have access to email and work at remote locations or assigned to customers rigs – this form allows and observer to type up their observation, save it to an email and send them into their coach or steering committee member. Four Page Version – The same as the four page electronic version – but can be printed off and used instead of the tally book version – people who have a hard time seeing the small print in the Tally Book version like this option. Every CBC has a definition and three examples of the observed behavior. These are contained in the observer manual and are always in the electronic four page version. The four page version is actually 12 pages – of which 9 pages are definitions and examples of the CBC’s. We use several in class exercises and class participation exercises to reinforce what safe and at-risk observed behaviors are in reference to our CBC. One is simple statements of observed behaviors and ask the class to identify which CBC best describes the behavior. Another goes deep into proper comment writing, where the last question is what is the CBC that best describes this observed behavior. By far the most popular method we use to help reinforce observed safe and at-risk behavior and the use of the CBC is a game called DEFINGO. Think of it as Bingo – but with CBC numbers as your game board and examples of safe and at-risk behaviors are identified by picking the right CBC that has a number in reference to the example given. It is popular because if your get DEFINGO – I have purchased prizes to be awarded to those that get DEFINGO. What makes our observer training unique or powerful is that we don’t train cookie cutter observers. If two observers observe the same person working – of course both observers will have similar CBC marked, but because we will train any employee to be an observer – an observers expertise comes from work and life experiences – so it is likely that one observer might have some insight that another observer wouldn’t, but by training such a diverse observer corps and encourage cross PSL observations – we cover all the bases in addition to breaking down cultural barriers associated with a PSL’s operational safety culture. Below is the defined Roles and Responsibilities of a GATOR Observer discussed and Taught in Observer Class – these roles are defined on a Steering Committee Level. This is out of the observer manual

Section 2: Roles & Responsibilities

OBSERVERS Roles and Responsibilities

1. Be a leader in safety and serve as a role model. 2. Demonstrate a commitment to the process. (2 observations / week) 3. Ensure confidentiality in all observations. 4. Provide soon, certain, and positive feedback to the Observee. 5. Perform a minimum of two observations every week. 6. Provide quality comments on the CBC.

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7. Perform fair and impartial observations. 8. Ensure the confidentiality of all collected data. 9. Provide feedback to Steering Committee on issues, concerns, or

questions. 10. Perform observations in a respectful and courteous manner.

11. Focus observations on behaviors and not on company policies, rules, or regulations.

Number 11 is very important – Our observers are not used as safety police – our observers are do not enforce rules or regulations – we look for safe and at-risk behavior. An example, if during an observation an employee takes off their hardhat but there is no risk from overhead loads – it is not marked at-risk. Sure it is against company policy, a rule, an OSHA regulation – but if there is no observed risk – its not at risk for a behavioral observation. Of course the observer is trained to offer feedback for the policy an example would be telling the employee that they were not at risk for an overhead load – but if you get in the habit of not wearing your hardhat – you may walk into a situation where you do become at-risk from an overhead load. Our observers are also not trained to care about the steps of a task – this allows for a secretary to go out and watch a guy work – because she does not care about what he is doing, she is looking for the behaviors that make up what he is doing. Is he lifting or lowering properly ? Is he keeping his eyes on his task and hands ? Is he being mindful of pinch points ? This also opens up one PSL to observer another PSL and break down cultural norms with in work groups. I don’t know the steps a cementer takes to perform their task – but I don’t care, all I care about during the observations is………………………… Is he lifting or lowering properly ? Is he keeping his eyes on his talk and hands ? Is he being mindful of pinch points ? Basic Observer Skills (observers fresh out of class are encouraged to get their feet wet using these methods) would be a Self Observation or a Peer to Peer Observation – where the trained GATOR Observer removes themselves from the work and performs a formal observation of those working – an observation for employees that put hands on steel last approximately 15 minutes, an office observation where an employee is sitting at a desk is usually a 5 minute observation. In a self observation the observer observes themselves a self assessment. More advanced Observations would be group observations where an observer has the skill to observe up to 5 people at once. Another advanced observation would be an observer announcing they will be doing observations while they are working with the group – where feedback is generated during work or when operations are completed. All GATOR Observers have the Halliburton Company right to use Stop Work Authority- and shut down anything that they feel will be causing grave bodily injury or death, and observers are encouraged to use SWA.

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Coaching An effective Coaching structure is paramount to the success of GATOR. Due to the size of our NWA, scope of operations, and observations being a voluntary process – effective coaching offers the quality control in the observation procedures and the data base. To be identified as a coach, you must be an observer and all be nominated by your steering committee member. Because coaches are assigned to observers and help define observer expectations and skill sets – we only want our outstanding observers identified as coaches. Coach Training is also a full days class. We also use coach training to groom future GATOR Steering Committee Members. If you remember from the application a steering committee member must have 4 learning requirements to represent a PSL and vote on the committee. Two

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of the 4 requirements are covered in coach training – Complete coach training and in coach training advance use of ABC analysis. This is the Coach Class Syllabus

Gulf of Mexico Coaching Requirements

and Course Outline

Course Requirements:

1. Coach candidate must be recommended by Steering Committee Rep for their PSL.

2. All Coaches must have access to email. 3. Coaches are assigned to observers. Your PSL GATOR Steering Committee

Member will help with this. Course Outline: Health and Safety Moment Housekeeping +/Delta of the Observation Process. Why We Coach - PowerPoint presentation Use of Coaching Cards and Observation Checklist Coaching Exercise – Blindfolds-Trashcans- and Sugar Packets Comment Writing – Review and Critique Observation Review – actual observation paperwork that we will review. RHS Data entry overview familiarization – why we collect all the data and what we can do with it. A-B-C Analysis Action Planning overview and familiarization – what the steering committee does with all the data Coaching Manual Section 5 PowerPoint presentation Coaching Practical – Performing an actual coaching experience. Course +/Deltas Below are the roles and responsibilities for our coaches as defined by the GATOR Steering Committee

COACHING Roles and Responsibilities

1. To set the example by performing quality observations. 2. Support the needs of assigned observers

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3. To help increase the skill sets of assigned observers 4. To communicate / develop / identify level three comments 5. Give feedback to the GATOR Steering Committee 6. To positively motivate observers 7. To help with observer network meetings 8. Critique observations for coaching opportunities 9. Track assigned observers skill sets for improvement opportunities 10. Attend steering committee meetings 11. Contact assigned observers on a regular basis – at least monthly 12. Perform one on one coaching opportunities

Because anyone can be trained as an observer, and outstanding observers are nominated for coach training, anyone that works in the GOM for Halliburton can be trained as a coach. There are several coaching methods that are taught in Coach Class. The most effective method is called the one on one method. This is where a trained GATOR coach watches his or her assigned observer perform an observation. The coach does not interact with the people being observed. Shortly after the observation is completed and the CBC is filled out the observer turns in the paper work to his/her coach, this is where to coach offers up feedback to the observer on the observers skill sets. Below is a coaching form the steering committee developed as a minimum expectation for an observers skill set, this is what a coach used when performing the one on one.

OBSERVATION SKILLS: COACHING GUIDE

Remember: The Coach takes notes (no talking) while watching the Observer talk to the worker. YES NO

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INTRODUCTION:

1. Observer explained how observation process works? ____ ____ 2. Observer explained & showed the Critical Behavior Checklist? ____ ____ 3. Observer mentions “no name, no blame”? ____ ____

4. Observer explained a feedback session will occur. ____ ____

FEEDBACK:

5. Observer discussed “safes” first? ____ ____ 6. Observer avoided using igniter words? ____ ____ 7. Observer sought agreement on “at-risks”? ____ ____ 8. Observer asked worker for input on working safer? ____ ____ 9. Observer offered positive suggestions? ____ ____ 10. Observer promoted discussion by asking questions? ____ ____ 11. Observer avoids starting feedback with “you”? ____ ____ 12. Observer listened to answers – checked for understanding? ____ ____

GENERAL:

13. Observer treated the worker with respect? ____ ____ 14. Observer was positive in approach? ____ ____ 15. Observer avoided getting into an argument? ____ ____

In addition to using this form the form below is used to capture coach feedback successes and developmental opportunities

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After the coach offers feedback to the observer – the coach will fill out the form above and make three copies of the form. One copy the coach keeps for reference to aid in future coaching of that observer, one copy the observer gets, and one copy has the

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observation CBC form that was conducted for this coaching opportunity stapled to it and it is forwarded to the Steering Committee Member for that PSL. The reason that the conducted observation is forwarded to the Steering Committee with the attached form is so the steering committee member is kept in the loop on his / hers observers skill sets, and based upon coaching form feedback – a steering committee can recommend that I adjust the observer class for observer skill set deficiencies and or develop a observer refresher course based upon observer needs. A deviation from the one on one preferred coaching method is when a coach gets one of his assigned observers and asks them to come observe him. Same value gained except now the coach can still continue to work. There are several supplemental coaching methods. We define a coaching contact as any communication verbal or written which objective is to increase an observers skill set. This would include direct and indirect communication, phone calls, emails, notes etc. There is also data coaching. Every observation turned in goes through a coach or steering committee member for quality control. Each card is a coaching opportunity. I can also present Observer Reports from the observation database either defining the quantity or based upon the quality of an observers observations. With all of the available information that is available for a coach – coaches know who needs more coaching that others for their assigned observers. We recommend that observers are contacted by their coach on a weekly basis – with a One on One coaching opportunity to occur at least monthly. Coaches are trained at operational facilities, for the same reasons stated above for observers. At the end of class there is a paired coaching practical. Workforce Our employees are a diverse group of highly trained people. The Oil and Gas Industry is a very technologically driven, physically, and mentally demanding industry. In addition employees go through rigorous training to ensure the delivery of safe - quality services to our customers. Because some PSL’s require through background checks due to explosive or radiation handling, and DOT requirements – a Halliburton Employee is usually over the age of 21. The quality of the services delivered to our customers depends upon the experience of our employees and the training needed to gain this experience. Each PSL has inherent risks associated with their services – High Pressure, Corrosive Fluids, Explosives, Radiation, etc. Every PSL has in depth safety training unique to the services that they provide. The median age of our workforce is 42 years old.

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Fluids Division Cement- The Cementing PSL has a very mature workforce – most employees have over 10 years of Halliburton Cementing Experience – with a large percentage having over 20 Years of Cement Experience. The younger cementers gain experience working land jobs, while the older cementers work in the offshore market. Cementers are trained in Duncan, OK. The median age of the Cement PSL is 46 years old. Baroid- The Baroid PSL is a diverse workforce. The fluid engineers on average are late 20’s to mid 30’s – the employees that work in the bulk plants usually have a low turnover and have a great deal of experience. The grinding plants have a varied age of workforce. The median age of the Baroid PSL is 40 years old. Completion and Reservoir Optimization Division – Because CRO delivers a multitude of services that require engineering, the engineers in CRO are usually younger with a college education. The employees that deliver the services to our customers are a very experienced group. CRO has a median age of 40 years old. Sperry Sun – This is a very technologically driven service line. The Sperry Sun Employees that deliver services on location for reservoir evaluation are primarily college educated and range from mid 20’s to late 40’s. The employees that are part of the directional drilling aspect of Sperry Sun are do not have college education but are very experienced and are usually older than those in reservoir evaluation. The shop people vary in levels of education and experience. The median age of Sperry Sun is 41 years old. Production Enhancement Division - This PSL is an extremely physically demanding PSL with inherit dangers associated with the services that are provided to our customers. The employees that make up this division vary in age and experience. HWO has a median age of 34, N2/CT is 33 and FA/SC median age is 38. Logging and Perforating- L&P PSL is very physically and mentally demanding. The engineers are working engineers, going out on customers locations and running the jobs. These jobs have explosive and radioactive hazards. The engineers are usually younger and the service operators are mostly a middle aged workforce. Turnover is high in this PSL the average length of employment with L&P is less than 10 years. The median age of L&P is 39. Integrated Solutions- The integrated solution side of IS/HDS has a very experienced mature workforce, where as the HDS side has a younger workforce. HDS is exposed to more risk than that of the IS side. IS median age is 42 years old. Miscellaneous Support-The maintenance part of Miscellaneous Support has a very experienced, mature workforce, that at times does travel to drilling locations to fix

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equipment. The Procurement and Materials has a varied workforce of experienced ex-field hands to warehousemen. Primarily P&M employees only operate out of Halliburton facilities and not on customers locations. Security Drilling Bit Service- SDBS is primarily made up of an older sales force that travels from company to company selling drilling bits, they do have a small warehouse with 4 employees that maintain the stock for the salesmen to sell. The median age of SDBS is 44 years old. ESG Management – Finance – IT – Business Development – Other PSL – ESG Management and Business Development is a very experienced team that works out of our corporate offices. Our management is composed of experience field employees or engineers that have proven their value to our organization. IT is our computer department, Finance is payroll, billing and the administrators of our business program SAP. The median age of all support functions is 45 years old.

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D. Safety Concerns – Our Corporate BBP Process started in the mid 1990’s as a pilot process in the California. Most of the NWA’s had plateau’ed out with respect to compliance driven safety tools. The Halliburton Organization has excellent tools for our employees to use, JSA, HOC, Near Miss Reporting, TaPRoot analysis of incidents, and Smith Driving, but we never had a safety program to wrap these tools together and to drive safety farther past compliance driven safety. The Halliburton Corporation had heard of other organizations reaping benefits from a behavior based safety process – so we tried the pilot and after 6 years of finding what worked for our organization – we began to roll BBP out to the rest of the continental US. Currently our BBP Initiatives are being rolled out one NWA at a time world wide. In the GOM we were the last US NWA to roll BBP out, the reason is the diverseness and scope of our operations, and we wanted to ensure we knew what would work for our organization before we tackled the GOM. Our safety initiatives in the GOM started way before BBP, reinforcing the tools that we already had in existence. The new safety focus started in the GOM in the mid to late 1990’s focusing on management tolerance and getting employees to participate using the tools that were already in existence. We focused management on one goal, communicating to employees that the existing at-risk practices did not need to occur – with proper job planning using Safety Huddles (pre-during-post job discussions) utilizing JSA (Job Safety Analysis) HOC (Hazard Observation Cards) reporting of near misses as proactive data to learn and teach employees on new safety best practices we started to see all incidents being minimized while reporting of near misses went up. In this time period we also purchased the Smith Driving Program to teach employees that risk is associated with driving and changing the behaviors that govern our driving practices. With all these new initiatives or reinforcing existing tools we started to see marked improvement in our safety performance, but nothing tied these tools together into a safety process, we plateau’ed out again. Then in 2002 came the PII (Performance Improvement Initiative) Health and Safety Big Three. The theory was why focus on new things each year, lets focus on three tools year after year that are proven effective to minimize incidents and injuries. Our management team was getting exposed to BBP and BBP was incorporated along with Smith Driving, and Safety Huddles to form the Big 3, even before the GATOR Rollout. All the upper management knew that GATOR was the direction for safety, and we began to coach them in its use and value. In Feb of 2003 we formed our Inaugural GATOR Steering Committee – most of the members were chosen because they were performers for their PSL. We clearly stated our goal of GATOR BBP was to initiate a culture change where our employees saw the value in working safe, the goal was that everyone goes home safe. Any organizations greatest asset is their

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employees and we knew that by engaging the front line employees in an employee owned safety process would get us the rest of the way home – 0 incidents.

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E. The PBBS Data GATOR started in Feb of 2003, and it takes 6 months to train a steering committee. The “graduation” is the development of the first Action Plan, we call them GATOR Alerts. The GATOR Alerts based on the data developed out of Observations and Feedback and are communicated to our entire workforce. Our first GATOR Alert came out in August of 2003. We were able to show the leadership of the GOM the value of BBP with the first GATOR Alert. Our first GATOR Alert which was based upon only 181 observations captured during a four month time mirrored the number one incident producing behavior for the entire year of 2002 - pre-GATOR this was number one at-risk behavior was Line of Fire. We showed through GATOR BBP that we can generate the same data it takes a year of incidents and injuries to trend – with only a small amount of observation data. This year was the first year we set targets and goals, previous years we focused on building GATOR, and this year with the advent of a new steering committee we set targets and goals for the process to achieve by Q4 2005. These are outlined below.

This is also what we use to govern our decision making with in the GATOR Steering Committee. If an idea, process improvement, action plan, or tools developed does not filter into the top three (Employees Get Home Safe- Safety Culture Change – Observations and Feedback) – the idea will be redeveloped until it does.

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This is how we set up the measurement of our goals and targets – the SMART Method for goals and targets. S – Simple Goals, M – Measurable Goals, A-Attainable Goals, R-Reasonable Goals, T- Timely Goals. It is no coincident that the goal of 100% Contact Rate is directly below the top three directions of GATOR BBP. The four other goals must be pursued in conjunction with one another to achieve the goal of 100% contact rate. As we get closer to 100% contact rate – observations and feedback will increase, as observations and feedback increase due to more and more times an employee is “contacted” through GATOR, we will achieve our goal of a culture change. The culture change goal is where our employees take pride in seeing the value in working safe, there is no other way to perform a job other than the safe way. When we strive for the goal of a culture change, this is where the employees get home safe – the sole purpose of GATOR Everyone Goes Home Safe !

Thus the GATOR Value Tree of Safety – everything we do filters into this “tree”.

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Contact Rate – this is a percentage of the employees that are contacted by observations. We take the number of employees observed through observations divided by the headcount either by NWA or PSL multiplied by 100. There is some error associated with contact rate, it is assumed that an employee does not get observed twice. Contact Rate in our opinion is a good gauge to the strength of the process and an empirical look at how long it will take for the culture to change. We know that there is some magical sustainable contact rate percentage, which once this contact rate number is reached and sustained the culture change will start to snowball. A higher contact rate, the quicker the culture change, a lower contact rate the longer the culture change will take. We do not know what this magical sustained contact rate is, but we know in theory that it exists. The Red line for 2002, 2003, and 2004 is the year ending TRIR for GOM Operations- in 2005 it is a month to month TRIR, the Green Line is the GATOR Contact Rate.

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As you can see the GATOR contact rate for the GOM is steadily increasing from the beginning of the process March 2003 to April 2005. Contact Rate is tracked by PSL also, and process trends of contact rate will be discussed by PSL later in the application. The employee count for the GOM is every employee that is assigned to our cost center, these numbers are given monthly to me from the NWA Accountant and can be considered extremely accurate. As of April 2005 there were 2182 employees in the GOM, through the GATOR Process we observed 523 or 23.89 % of the employees assigned to the GOM Cost Center. We track PSL performance by contact rate monthly, the green line is the target of 100% contact rate.

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April Contact Rate

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Non Enabled and Difficult Follow UP – NE&D – Goal 100% close out. Through the GATOR Observation Process we identify at risk behaviors by: Enabled – The employee is enabled to work safety by existing tools and procedures Difficult – The employee has difficulty working safe do to some deficiency in tools or procedures. Non-Enabled – The employee has no choice but to work at-risk, they need something to perform the job safety. We track the Non-Enabled and Difficult opportunities that arise out of observations. If we identify deficiencies due to barriers that are present in our work environment, we need to follow up, fix these deficiencies, and show our employees that GATOR is working for them. The steering committee knows that following up on NE&D’s gives GATOR meat, it shows we are serious about removing barriers, this is important to track. If our observers and the people who are observed identify these opportunities these are opportunities to increase safety by administrative or engineering controls, and again to show our employees that GATOR works for them.

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April NE&D

020406080

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These Opportunities roll over from month to month. So it is easy to see which steering committee members need help in initiating the closures. Some of these fixes take a long time to close out, like the P&M opportunity which was just closed out after 6 months, a leaking roof at a facility, where some are very simple, a new ergonomic keyboard for an office worker. We catalog the closures of NE&D’s to show the impact that observations have had to our employees, also because another PSL may have a similar opportunity, if we catalog these, then another PSL does not have to re-invent the wheel. Once an NE&D is closed out – the steering committee member responsible fills out a win sheet- turns it in to the facilitator to catalog the win – and the steering committee member gets this sticker to place on the improvement to that the employees know that this fix was identified and fixed their GATOR Process. Coach to Observer Ratio- A target of 1 coach assigned to 5 observers We know that an observer is more likely to perform observations if they are positively motivated, and contacted regularly. The goal and target of 1:5 will help us tap into the potential of our observers performing observations. Coaches are developed, they are not hatched. A steering committee member nominates their outstanding observers to receive another days worth of training to be able to affectively coach their assigned observers. A

THROUGH

GATOR

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coach is a person who also helps to increase observer’s skill sets. Coaching can occur in several different ways, the most effective way is by watching an observer perform and observation, then offering up positive and guidance feedback to the observer in the goal to increase their skill sets.

Coach / Observer Ratio [Target 1:5]

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The goal of a 1:5 ratio is the green line across the graph. The coach ratio is simply, the number of trained observers divided by the number of trained coaches. Cement PSL has a ratio of 1 Coach per 14.57 Observers. Observer Participation – Our Goal and Target for Observer Participation is to just increase Observer Participation. The GATOR Process is a voluntary process. When the steering committee looks at the observations data we can be relatively sure that the data generated was actually gathered during an observation, and not falsified sitting at a desk because of a mandated quota through management. Our observer participation graph looks discouraging, but we know the root causes of a decline in participation.

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GATOR Observer Participation

33%

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The reason that observer participation has steadily decreased is because we didn’t have the coaching structure in place to contact observers on a regular basis. The green line shows the recommendations that arose out of Halliburton’s BBP Sustainability Review, in which one of their recommendations was to assign observers to trained coaches. The graph shows that the recommendation and the quick acting on the steering committee member’s part slowed the decline in observer participation. The blue line shows the effects of our goals and targets for 2005, an increase of observer participation. The goals and targets were set in Feb of 2005 the “official” beginning of the new GATOR Steering Committee. We feel that as we get closer and closer to the Goal and Target of the coaching ration of 1:5 we should see a steady increase in our observer participation. PSL BBP Structure- There is no graph as of yet to show the structure of BBP in a PSL, PSL’s do have organizational charts of which observers are assigned to which coaches, but this goal and target goes deeper that observer assignments. This goal and target tracks BBP Conference Calls within an organization. Because many PSL have multiple facilities a monthly conference call has been realized as a best practice to communicate to observers the decisions that are made on a steering committee level. PSL BBP Structure also tracks Observer Network Meetings. Observer Network Meetings are where Observers meet to either get “calibrated” in new observation techniques, discuss difficulties or barriers to performing observations, communicate what is being addressed out of the NE&D follow up, and discuss the behavior change that may be occurring due to the observation process. PSL BBP Structure also tracks quarterly BBP PSL One on Ones. This is where an PSL Operations Manager – the PSL Steering Committee Member and any other interested parties meet to discuss the barriers to implementing BBP in their

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PSL. These are just tracked in a spreadsheet to see utilized potential of best practices that have developed out of learning Implementation of GATOR. Other Graphs – These graphs are used to track % Safe through Observations. This is simply the total number marked through observations and the % Safe. The primary interpretation is to see if we are maintaining an average safe through observations.

Behavior Change Index

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This is just another representation of the observation data, the number marked safe vs. the number marked at risk.

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F. Description of Your PBBS Program Please refer to this picture when reading through the description of how GATOR works for our employees in the GOM.

SteeringCommittee

Data Entry& Analysis

BBP Safety Cycle

Critical Behavior Checklist

Critical Behavior Checklist

IncidentAnalysis

ActionPlanning

No NameNo Blame

No Surprises

No NameNo Blame

No Surprises

This slide is used in our Rollout Presentation. This presentation was developed to educate our employees on what was to come with the rollout of GATOR. Steering Committee – The steering committee (SC) is the decision make group for GATOR. All operations PSL have at least one representative to the SC. A steering committee member serves 2 years, we just switched out the inaugural steering committee this past February. To be a voting member on the Steering Committee, the inaugural steering committee stated you must have completed 4 learning requirements.

1. Be a Trained Observer 2. Be a Trained Coach 3. In Depth use of ABC Analysis – taught in coach training 4. Be present during a Steering Committee Meeting where the GATOR’s perform

Action planning on observation data. Each current steering committee member grooms their replacement over time, and their successor will join them for meetings to learn how the GATOR’s operate during meetings. In February we just didn’t switch out members – it happened over a period of time starting in about October of 2004 and ending in April of 2005. The steering committee is composed of about 50% Front Line Employees and 50% as close to front

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line – management as possible. If I as the facilitator were to have a process improvement for the GATOR Process, I have to propose it to the steering committee for their approval. We have three management sponsors to GATOR. Management Sponsors help us with the process improvement decisions that arise our of observations. They bring a wealth of experience and education to the GATOR’s. We are making recommendations that affect all 2182 employees in the GOM, but we are primarily front line employees and managers who don’t necessarily have the expertise or insight for these decisions, so our management sponsors make recommendations for implementation of these process improvements. The Steering Committee meets once a month, it is a pleasure to work with such motivated and dedicated people to the safety of our fellow employees. Incident Analysis- Each new SC reviews the previous two years incidents and injuries. Halliburton uses an internal database RHS – Radian Health and Safety that presents the incidents and injuries in easy to read forms. The Inaugural Steering Committee 2003 – review incidents and injuries form 2001-2002, the New Steering Committee 2005 reviewed the incidents and injuries from 2003-2004. The reason we do this every two years with the formation of New Steering Committees is to develop the new critical behavior checklists (CBC). We read through every incident and injury to GOM employees looking for the causal behaviors of the incident or injury – this is how we develop the Critical Behavior Checklist, the primary tool our GATOR Observers use when performing observations. Through Incident Analysis we see that 94% of incidents and injuries are caused by at-risk behavior. The second reason that incident and injury review is the first “task” as steering committee does is to foster ownership in the GATOR process, and to show them the importance of at-risks behaviors in our operations.

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Critical Behavior Checklist-

This is an example of our CBC that was generated from incidents 2001-2002 by the inaugural steering committee, used by our GATOR Observers from Feb 2003 to Feb 2005. This focus’s our observation and feedback potential on the 94% causal at-risk behaviors of incidents and injuries – a very powerful tool to change at-risk behavior to safe through observations.

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This is the new CBC developed by the new steering committee in Feb 2005. Some note able additions – Environmental Behaviors – we are now looking for the causal at-risk behaviors tied to environmental incidents, and the addition of driving observations by using the Five Keys to Smith Driving. If you have noticed we call our company behavior process BBP – Behavior Based Performance. In the future we are looking to role behavior observations into our three core business philosophies – Health and Safety, Environmental, and Service Quality. We have rolled it out into environmental behaviors, and sometime in the future plan on Service Quality Behavioral Observations also. These CBC not only are one page CBC’s that are good to fax into a coach from a remote facility or customers location, but it is also our tally book format. The left 1/3 is the front, middle 1/3 is the back where comments are captured, and the right 1/3 is printed on the hard backing that is slid into the tally book front cover. A tally book is a small book whose named was derived by keeping a tally of the drill pipe that is run in the well. Any oil field worker worth their weight keeps a tally book in their back pocket to keep notes during operations. By having a tally book version of the CBC – our employees don’t miss out on observation opportunities when they arise, because they should always have their CBC in their Tally Book. We also offer a 4 page electronic version of the CBC that an observer can type on, save to an email, then email into their coach or steering committee member for review and entry into the database.

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Safe and At-Risk Behavior Determination – Incident Investigation The GATOR CBC is developed every two years. What determines what behaviors that are on the CBC comes out of incident investigation. We review every incident for the previous two years and tie behavioral causes to the incident. The report below is a First Aid incident. This report in 2007 will be one that we will be reviewing for our next CBC development. Incident investigation – Below is a recent First Aid that occurred – this is captured by an employees supervisor. Near Misses and First Aids are captured by a supervisor and entered into a data base – what is below is the report that is communicated to our employees. Anything that involves and OSHA Reportable/Recordable has to be investigated through TapRoot Analysis. This is where interviews are conducted and the determination of the causal factor is found for the incident. TapRoot Analysis are only conducted by people who have received the two day training for TaPRoot and HSE representatives. All TapRoots involve a representative from HSE. Below is a first aid report

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*** Please do not reply to this e-mail, as it is an automated message ***

INCIDENT NUMBER: 422545 INCIDENT DESCRIPTION: Small cut to palm of hand.

BUSINESS UNIT: Energy Services Group PRODUCT LINE: Completion Tools COST CENTER NUMBER: 1017310005 COST CENTER DESCRIPTION: Slickline -Houma, La

INCIDENT TYPE: Injury / Illness Incident VEHICLE REPORTABLE CLASS: INJURY RECORDABLE: First Aid Case NEAR MISS: NO

GEOGRAPHIC UNIT: Terrebonne Parish, Louisiana, USA SITE NAME: HES Houma Hwy 90 LOCATION TYPE: Offshore Platform LOCATION DESCRIPTION: Cognac Platform, MC 194-A

OCCURRENCE DATE: 05/10/2005 OCCURRENCE TIME: 11:00 AM

CUSTOMER: Shell Offshore Inc. ENTERED BY: Zachry, Randy 985-857-3877 SUPERVISOR OF WORK ACTIVITY: Robichaux, Mark 985-876-9150

RADIATION/EXPLOSIVES INVOLVED: NO

INCIDENT DETAIL DESCRIPTION: Employee states he was attaching .092 wire to a wire scratcher and the wire slipped and penetrated through his glove and punctured the palm of his right hand. The employee was treated with first aid on location and returned to work.

THE INFORMATION CONTAINED IN THIS REPORT IS CONFIDENTIAL AND PROPRIETARY TO HALLIBURTON, AND MAY BE PROTECTED BY CERTAIN LEGAL PRIVILEGES. DISTRIBUTION OF THIS REPORT AND ANY INFORMATION CONTAINED IN IT SHOULD BE LIMITED TO A NEED TO KNOW BASIS WITHIN THE COMPANY. THIS REPORT SHOULD NOT BE DISTRIBUTED TO ANY PERSONS OUTSIDE OF THE COMPANY WITHOUT SPECIFIC PRIOR AUTHORISATION FROM THE APPROPRIATE COMPANY LEGAL REPRESENTATIVE. IF YOU HAVE RECEIVED THIS INFORMATION IN ERROR, NOTIFY THE SENDER BY TELEPHONE OR EMAIL, AND DESTROY ANY COPIES YOU MAY HAVE

Something that we just started was an Incident Newsletter that ties in behaviors to incidents and injuries – these are performed on all incidents that go through TapRoot. I work with an HSE rep who presents the TapRoot Findings – then I add the behaviors that could be contributing factors. This bulletin is also used proactively because we are sharing on an NWA level – someone out there could learn from somebody else’s

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incidents and it also communicates how important of a safety at-risk behaviors impact our operations.

Observation Process- GATOR is a voluntary process – observations are not mandated by management. In some cases the observer class is mandated – but not the observations themselves. This ensures that the data that is generated is not fluffed by some quota. Any Halliburton employee in the GOM can be trained as a GATOR Observer, even managers. We state that GATOR is front line employee owned and driven with management support and understanding. There is a strict No Name, No Blame, No Surprises Philosophy for GATOR. We do not capture the names of the employees that are observed, observations are anonymous and confidential. Our GATOR Observers do not Blame a fellow co-worker for working at risk. Our Observers seek to understand why the employee is working at-risk, identify barriers to safe work, and to initiate a behavior change through feedback. Because observations do not capture the name of those observed, and these names are not given to an employees immediate supervisor, there are no ramifications or repercussions associated from management retaliation for saying management is the reason they are working at-risk. A valid GATOR observation requires two key components, an introduction by the observer declaring the purpose of the visit, and feedback immediately afterwards with the employee(s) observed. We can perform three types of observations, Self Observation – where an employee reviews with themselves the behaviors they exhibit while performing operations. Peer to Peer Observation – Where one employee observes another single employee. Group Observations – Where a skilled observer can observe up to 5 employees at one time, or while working with employees, declares while they work together the observer will be doing an observation, and when a break in operations permits, feedback will be generated with his or her fellow employees. 3rd Party Observations – This is a new observation type, two months old. We have opened out observation process up to any person that assisits us in accomplishing our task. Now if a rig person assists us in rigging up or down on a customers location, we can now include them in the GATOR observation process, and offer them feedback to help get them hope safe at the end of the day. We can observe in four different settings. Facility – An observation conducted at a Halliburton Operational facility either in the shop or in the office. Wellsite – An observation that is conducted on Halliburton Employees performing services on a customers location Dockside – We have several operational facilities at docksides along the Gulf of Mexico. Driving – Using the Five Keys to Smith Driving performing an observation on an employee while driving.

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A GATOR Observation currently can only be performed on a Halliburton employee that works in the GOM NWA. Briefly a rundown of how an observation works. The GATOR Observer introduces themselves and an observer and asks if the person has ever been observed before – if the answer is no, the observer will then show the CBC, explain this is a no name process, the observation data collected will not go to their manager, and then the observer will ask permission to observe the employee(s). Our employees have to right to turn down being observed, but they do not have the right to turn down every opportunity to be observed. If this is an operational observation feedback usually begins after 15 minutes of observing. The GATOR Observer starts feedback with specific feedback to everything that is observed as safe first, this safe feedback reinforces the safe behaviors, then the observer once finished with all safe observed behavior feedback transitions into the feedback for at-risk behaviors. This feedback is aimed at understanding why the employee is performing this behavior at-risk, identifying barriers to safe behaviors, and following up on opportunities that arise out of the observation. If the observation is conducted on an office person working at their desk, an observation can be conducted in five minutes or less. Once the observation is completed, the observer will thank their fellow employee for the opportunity to perform the observations and then go and complete the observation paperwork. Comments are written for all at-risk behaviors stating specifically what was observed pertaining to a specific CBC and why it was that the fellow employee gave for performing that behavior at-risk, we also ask for at least one safe comment per observation. After the observation paperwork is completed, the observer will turn the paperwork into their assigned coach or steering committee member for quality control of the observation database. Data Entry- All Observations are reviewed for coaching opportunities prior to being entered into the database. Observations are entered into a Halliburton Database – RHS – Radian Health and Safety. Data Entry takes 5-15 minutes per observation and we are currently pursuing any available means to alleviate data entry burden. Action Planning - The GATOR SC performs action planning on observation data once a quarter. There are several reports that the GATOR’s use in Action Planning that the database provides to us. A graphical breakdown of GATOR Action Planning is on the next page, and a step by step procedure on the page that follows that.

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Action Planning Flow.igx

Observatons

Coach or Steering Committee

Member

Data Entry RHS

Report of Observation DataTabular - Observer - Comments

GATOR Steering Committee

Action Planningevery 3 months

ABC Analysis

The AComments from Observation data

The CReports from Incidents and

Injuies

The BTabular Report -

GATOR discussions#1 At-Risk

GATOR Alert Topic

What ? are our employees doing

at-RiskRigging up, Crane Ops

etc.

Why ? are our employees performing at-Risk

Complacent/Habit etc.

ObserverObserver Observer Observer Observer Observer

Opportunity Statement

Steering Committee Brainstorming

Implementation Team

Implementation Team

Implementation Team

Implementation Team

ProjectChair

DeadlineVolunteers

ProjectChair

DeadlineVolunteers

ProjectChair

DeadlineVolunteers

ProjectChair

DeadlineVolunteers

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First Step: Review The Tabular Report for the quarter – any member can request that a CBC behavior be considered for action planning. Usually there are 5-7 CBC’s that the GATOR’s suggest to perform action planning on. Second Step: Data Validation – is there enough observation data to support action planning on. If not – CBC behavior is not considered. Third Step: Remaining CBC’s are reviewed for Incidents and Injuries- these incidents and injuries correspond to the same time period for the observation data and come from the RHS database for incidents and injuries. Fourth Step: Usually there are 2-3 CBC’s left after reviewing step 3 Fifth Step: GATOR Open Discussion on remaining CBC’s – during this step the one CBC is chosen for the GATOR Alert. Sixth Step: ABC Analysis on the CBC – the A’s come directly from the “why” portion of observation comments – the B is the CBC Chosen in step 5 – the C’s come from supporting incidents in step 3, and input from personal experiences. Seventh Step: The Opportunity Statement is developed – This statement declares the reasons for the GATOR Alert – where the data came from – what our goals and targets for the alert are – the time frame the data was collected over – where/ what the at-risks were performed. If there is a process improvement that is needed from the evaluation of the observation data through ABC analysis – this is where the SC develops this opportunity. Eighth Step: Brain Storming – Everybody generates ideas to what we can develop, suggest, or change to help change this at-risk to a safe. Ninth Step: Each GATOR Gets 10 “dollars” to spend on the ideas – they can spend all 10 on one idea or split their 10 across several ideas. Tenth Step: Formation of Teams (voluntary)– The GATOR Alert Team is called the Execution Team – They take the opportunity statement – observation data, supporting incident reports – and they form the GOM GATOR Alert and the process improvement initiative that is recommended to the Leadership Team of the GOM An Implementation Team take the GATOR Committee ideas from brainstorming and develop the idea – there are usually several Implementation Teams. All team work is agreed upon at the team level, then goes to the GATOR committee to vote and accept their work, once the Execution and Implementation Teams work is voted on by the GATOR Committee it is then distributed or suggested as an action to The entire GOM or the PII H&S Core Team. This is our current GATOR Alert for Walking and Working Surfaces. All GATOR Alerts have the same “look” but the colors of the alerts change.

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G. Graphic Displays of the Data In the graphs below we will show incident data by PSL from 1999 to Jan 2005. We have compared our incident data to that of an industry standard IADC – International Association of Drilling Contractors. IADC breaks down data into Land (yellow) and Water (pink) IADC data is a good comparison for service companies in the oil and gas industry.

GOM Total Recordable Incident Rate

0

2

4

6

8

10

12

14

1999 2000 2001 2002 2003 2004

Year

Inci

dent

Rat

e

IADC LandIADC WaterGOM

Pre GATOR Post GATOR

Steering Committee formed Feb 2003 - First observer class Jun 03Full Time Faciltator Sept-03 - Second observer class Oct-03Observer training on monthly basis since Oct -03.

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0

1

2

3

4

5

6

1999 2000 2001 2002 2003 2004

BLSHalliburton

The incident rate data is taken from the Bureau of Labor statistics year 1999-2002 SIC Code 138, 2003 NACIS code 21. Data presented for 2004 under BLS data is the same as 2003 due to numbers not being available for the year 2004. The left of the green line is pre GATOR, to the right is after GATOR was adopted. We will include a breakdown of incident data by PSL with a small description of contributing factors to aid in the interpretation if needed – please remember BBP started in February of 2003, but as we know implementing BBP in such a large organization may take some time to show effectiveness.

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Above is a representation of Halliburton Gulf of Mexico TRIR vs. USA Operations minus GOM performance.

Baroid Total Recordable Incident Rate

0

0.5

1

1.5

2

2.5

3

3.5

1999 2000 2001 2002 2003 2004

Year

Rat

e

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Cement Total Recordable Incident Rate

0

0.5

1

1.5

2

2.5

3

3.5

1999 2000 2001 2002 2003 2004

Year

Rat

e

CPS Total Recordable Incident Rate

0

0.5

1

1.5

2

2.5

1999 2000 2001 2002 2003 2004

Year

Rat

e

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TTTCP Total Recordable Incident Rate

0

0.5

1

1.5

2

2.5

3

3.5

4

1999 2000 2001 2002 2003 2004

Year

Rat

e

Series1

Sperry Total Recordable Incident Rate

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1999 2000 2001 2002 2003 2004

Year

Rat

e

It can be assumed that before Sperry Sun was acquired by Halliburton that they did not accurately report by the standards to which we report with in the Halliburton

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organization, we believe that the data prior to 2001 may be incomplete or missing altogether.

PE total Recordable Incident Rate

0

0.5

1

1.5

2

2.5

3

3.5

4

1999 2000 2001 2002 2003 2004

Year

Rat

e

Series1

Production Enhancement includes the sub-PSL’s FA/SC, N2, CT and HWO – we know that BBP Implements quicker in some PSL than others. As we break down incident rate data vs. Contact Rate data by PSL – there will be further discussion on the sub-PSL’s tha make up PE

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Logging Total Recordable Incident Rate

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

1999 2000 2001 2002 2003 2004

Year

Rat

e

ESG Management

0

0.5

1

1.5

2

2.5

1999 2000 2001 2002 2003 2004

Year

Rat

e

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Finance Total Recordable Incidetn Rate

0

0.5

1

1.5

2

2.5

3

3.5

4

1999 2000 2001 2002 2003 2004

Year

Rat

e

There is a great opportunity that we are currently pursuing for the Finance PSL – approximately 5 years ago we incorporated a German Business Software Program called SAP. SAP is a very powerful tool for tracking in a large organization, but also requires a great deal of data entry. What we are seeing here is the effects of all the data entry, and no real knowledge on proper office ergonomics. We are currently researching an office ergonomics program to get the incidents caused by improper officer ergonomics turned around.

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BD Total Recordable Incident Rate

0

0.5

1

1.5

2

2.5

3

3.5

4

1999 2000 2001 2002 2003 2004

Year

Rat

e

Support Total Recordable Incident Rate

0

0.5

1

1.5

2

2.5

3

1999 2000 2001 2002 2003 2004

Year

Rat

e

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Lets take a look at contact rate graphs vs. incidents by sub-PSL since the incorporation of GATOR BBP. These graphs on the left hand side show 2002 final incident rate – then the incident rates for 2003, 2004 are the year ending incident rates for the PSL. In 2005 we are tracking monthly incident rates – we know that one incident for a month will cause the graph to look discouraging – but remember these incidents in 2005 are a rate by month. The Y- axis left is the % Contact Rate – where the Y-Axis Right is the Total Recordable Incident Rate.

GATOR BBP Contact Rate

0

5

10

15

20

25

30

Mar-03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

Contact RateTRIR

Above is the overall Gulf of Mexico.

Baroid BBP Contact Rate

0

2

4

6

8

10

12

14

16

18

Mar-03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

Actual Contact RateTRIR

Baroid Steering Committee Members – Woody Wilson, Ryan Marceaux, John Toups, Kenny Holland

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Cement BBP Contact Rate

0

5

10

15

20

25Mar-

03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

1

2

3

4

5

6

Actual Contact RateTRIR

Cement Steering Committee Members – Tom Broussard, Larry Cooksey

CPS BBP Contact Rate

0

5

10

15

20

25

30

35

40

45

50

Mar-03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.5

1

1.5

2

2.5

Actual Contact RateTRIR

CPS Steering Committee Members – Gary Wellbrock, Gary Freeman – GATOR Successor – Candace Porche These next four graphs represent the Production Enhancement PSL which is composed of FA/SC, Nitrogen, Coil Tubing and Hydraulic Workover. Corporate Halliburton does not break Incident rates down by sub PSL, so all the sub PSL incident data are the same. On the Sub- PSL Level – FA/SC has had a sustained contact rate of over 100% since March of 2004 – and their over all incidents have seen a 50% reduction – where HWO has been slow to implement GATOR – and the over all PSL incident data show difficulty due to HWO safety performance.

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FA/SC BBP Contact Rate

0

20

40

60

80

100

120

140

160

180

200Mar-

03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

Actual Contact RateTRIR PE

FA/SC Steering Committee Member – Libby Clostio

Coil Tubing BBP Contact Rate

0

20

40

60

80

100

120

140

Mar-03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

Actual Contact RateTRIR PE

Coil Tubing did not have a dedicated Steering Committee Member until May of 2004 – you can see the value gained in contact rate by having a Steering Committee Member represent a PSL Coil Tubing Steering Committee Member – Carl Creppel – GATOR Successor Donald Arceneaux

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Nitrogen BBP Contact Rate

0

50

100

150

200

250

300Mar-

03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

Actual Contact RateTRIR PE

Nitrogen Steering Committee Member – Billy Trahan

HWO BBP Contact Rate

0

10

20

30

40

50

60

70

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

1

2

3

4

5

6

7

8

9

Actual Contact RateTRIR PE

HWO was slow to implement BBP into their operations and the PSL incidents reflect some safety difficulties associated with this decision. With in the last three months HWO has dedicated Danny Vigie to represent HWO on the GATOR SC.

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IS BBP Contact Rate

0

5

10

15

20

25

30

35

40Mar-

03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Actual Contact RateTRIR

The Inaugural Steering Committee Member for IS was not the right person for the job- his PSL duties did not lend him to be an effective Steering Committee Member. In July of 2004 we identified another Steering Committee Member, and the value gained is evident in their contact rate graph – 0 incidents for the past 5 years. IS Steering Committee Member Bobby Louviere

Logging BBP Contact Rate

0

10

20

30

40

50

60

Mar-03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

Actual Contact RateTRIR

Logging and Perforating Steering Committee Member – Mike Malone

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Maintenance BBP Contact Rate

0

10

20

30

40

50

60

70

80Mar-

03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

2

4

6

8

10

12

14

Contact RateTRIR Support

Our Maintenance PSL is composed of a very experienced, mature workforce that is resistant to change. We have tried a plethora of ideas to engage the Maintenance PSL in the adoption of BBP. The operations manager has decided to mandate the observations for a short period of time starting in March – to get his “resistant to change” employees in the habit of performing observations. Maintenance Steering Committee Member John Thompson.

P&M BBP Contact Rate

0

10

20

30

40

50

60

70

Mar-03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

2

4

6

8

10

12

14

Actual Contact RateTRIR Support

Corporate Halliburton does not break the Support PSL down into sub PSL’s this is why Maintenance and P&M have the same TRIR graphs. There is a significant increase in July of 2004 with the adoption of a coaching challenge between 2 coaches, once the challenge ended, so did the observations. P&M Steering Committee Member Bryan Roberts.

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Sperry BBP Contact Rate

0

2

4

6

8

10

12

14

16

18

20Mar-

03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.2

0.4

0.6

0.8

1

1.2

1.4

Actual Contact RateTRIR

A beautiful example of the desired effects of BBP – similar to other PSL’s Sperry Sun Steering Committee Member – Warren Trest

SDBS BBP Contact Rate

0

10

20

30

40

50

60

Mar-03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Actual Contact RateTRIR

Security Drilling Bit Service has been slow to implement BBP. They flirted with the idea of a Steering Committee Representative, but choose not to pursue it. SDBS has been incident free for 5 years, they are not represented on the GATOR SC – but information is filtered to them through Sperry Sun.

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TTTCP BBP Contact Rate

0

5

10

15

20

25

30

35

40Mar-

03

Apr-03

May-0

3

Jun-0

3

Jul-0

3

Aug-03

Sep-03

Oct-03

Nov-03

Dec-03

Jan-0

4

Feb-0

4

Mar-04

Apr-04

May-0

4

Jun-0

4

Jul-0

4

Aug-04

Sep-04

Oct-04

Nov-04

Dec-04

Jan-0

5

Feb-0

5

Mar-05

Apr-05

0

0.5

1

1.5

2

2.5

3

3.5

4

Actual Contact RateTRIR

TTTCP lost their inaugural SC member to an acquisition in August of 2004 – the new steering committee member has been transferred to Houston. TTTCP in May TTTCP identified a new Steering Committee member Jerry Gilmore.

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60

H. Analysis of the Data Because we are pursuing a process accreditation and not individual PSL accreditation section H of the Application is only showing the GOM Operations Data and the interpretation there in.

Monthly Recordable Incidents

0

1

2

3

4

5

6

7

8

9

10

Jan-

99

Apr

-99

Jul-9

9

Oct

-99

Jan-

00

Apr

-00

Jul-0

0

Oct

-00

Jan-

01

Apr

-01

Jul-0

1

Oct

-01

Jan-

02

Apr

-02

Jul-0

2

Oct

-02

Jan-

03

Apr

-03

Jul-0

3

Oct

-03

Jan-

04

Apr

-04

Jul-0

4

Oct

-04

Jan-

05

Apr

-05

# of

inci

dent

s

# of Rec InjLinear (# of Rec Inj)12 per. Mov. Avg. (# of Rec Inj)

This graph is representative of OSHA recordable incidents from Jan 1999 to the second week of April 2005. The black line is a trend line, the blue line is a 12 month rolling recordable incident rate. The green line is representative of a step change in our safety performance. The red circle is a spike during our step change, we lost 4 employees in a 3rd party helicopter accident. Due to the strictness of our reporting we carry these fatalities, though we had no control over the causes of the incidents. Before October 2003 (green line) you are looking at the reactive safety program before GATOR BBP. Where safety was focused on when the incidents were high, when they were low – it was the status quo – reacting to incidents and injuries that have already occurred. After October of 2003 you see the effects of GATOR BBP. We are focusing on the proactive data generated out of GATOR Observations – a proactive safety program, and you should see a significant step change (blue line) in our safety performance, in addition to a minimalization of the high peaks and low troughs indicative of a reactive safety program. This process works and we are only infants in utilizing the potential of our BBP Process!

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Cambridge Center for Behavioral Studies Accreditation Application

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The Inaugural GATOR Steering Committee.

G.A.T.O.R Gulf Coast – Action – Team – Observing – Risk

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The New Steering Committee – with some of the Inaugural Members as they became GATOR Champions