Oil and gas operators in the Gulf of Mexico face a number of important risks. Traditionally, social performance and third-party stakeholder risks do not tend to be among those that receive the highest priority attention. While this level of attention is likely appropriate under normal operating conditions, advance planning and preparations for managing social risks have become critical to emergency preparedness. This paper discusses the importance of crisis-ready, community-based stakeholder engagement to managing emergencies in this operating environment, and what operators can do to strengthen emergency response planning through improved social risk management.
Despite the financial, reputational and environmental costs resulting from the 2010 Deepwater Horizon incident, industry actors count on strong stakeholder support for oil and gas activities in the Gulf of Mexico (GOM). Economically, the region depends on the industry for jobs, spending, and taxes. Stakeholder engagement is often limited to local, regional, and national regulatory and elected officials, or industry groups. Many of the GOM operators' social performance management efforts are focused on philanthropy, supporting education and local businesses, and employee/labor pool engagement.
The oil and gas industry has learned important lessons about how critical stakeholder engagement and community support is to protecting value. Nonetheless, operators still sometimes underestimate the dynamic, multifaceted community relationships in Gulf Coast communities. The level of understanding and response to stakeholder concerns on the local level can distinguish companies when negative incidents occur. Strong relationships with local civil society are invaluable in emergency response situations, especially when existing feedback mechanisms are well-known and utilized.
Successful operations in the GOM may not require the same level of stakeholder engagement rigor as operations in conflict-affected, on-shore operating environments. But they do need risk-based applications of current good international industry practices that are both fit-for-purpose and capable of functioning effectively both in normal operating conditions and crisis conditions. Even in areas with decades of industry activity, world-class stakeholder engagement strategies are critical to managing health, safety and environmental, and business risks, especially in preparation for potential emergencies.