2002 Manila, the Philippines

The Pandacan Petrochemical Depots — a 30-hectare oil and petrochemical tank farm and loading complex run by a group of oil com-panies including Shell — is located in a highly populated section of Manila. On any given day, the depot contains about 330 million liters of volatile substances in storage: gasoline, aviation fuel, crude oil, bunker oil, diesel, LPG, and other substances. Yet, within a two kilo-meter radius of the complex, there are more than 83,000 residents, as well as the Philippine Presidential Palace. Schools, churches, daycare centers, restaurants, and other small businesses also fall within this two kilometer radius. The Carlos P. Garcia High School, for example, is directly across the street from the Shell portion of the complex. Shell trucks hauling flammable materials move regularly to and from the facility near this school. Caltex, Petron, and other companies at the complex also have facilities near schools and homes. Over the years, there have been leaks and pollution from the complex, and oc-casionally fires. Maria Wilma Barrias, a neighbor of the Pandacan com-plex, recalls a fire at the Shell facility: ". . . You know, when there was a fire here, the employees of Shell were locked up inside. They didn’t let them out. The first place they fought the fire was inside instead of outside. They locked the doors. I know because my husband was working there. Putting out the fire at the depot was given priority before extinguishing it at the residences." Shell reports that there have been fires at their depot. A February 1987 fire occurred there after a loading hose disconnected from a truck at the LPG bulk filling station, resulting in property damage and lost work days. In October1997, there was a flash fire in one of Shell’s loading bays at the main fuel terminal, caused by a faulty grounding system.

Pilipinas Shell says no reports of incidents can be found earlier than 1996. "There are informal stories about one of the LPG sphere vents being struck by lightning in 1991 or 1992, and the escaping gas catching fire," says Shell. "The community was reportedly alarmed, but the fire was extinguished without any loss to property or lives, and no recorded or remembered community action." Still, many of the residents of Pandacan want the oil companies to honor a 1993 agreement they made with the Philippine government to move the depot to a new location by 2003. However, as the deadline for relocating the facility has approached, the companies have been stalling for time, calling for further study, or even reconsidering the move entirely. Shell, for example, says it may have to do a risk study on the move and questions whether "we really need to transfer or just improve our facilities." Jocelyn Dawis-Asuncion, a Manilla City Councilor, points out that relocation studies were done in 1993, and further study now that would take another 6-to-18 months is simply a delaying tactic. "Safety is our concern," says Shell in big letters on a billboard along the perimeter of the Pandacan complex — "Because We Care." Yet many of the residents living in this part of Manilla have expressed their doubts about that claim.

On land, the Royal Dutch Shell group of companies operates re-fineries, chemical plants, storage terminals, gas processing plants, supply and product pipelines at hundreds of locations worldwide. Add to these hundreds of offshore oil and gas platforms and miles of under-water pipelines. At the retail and neighborhood level are the company’s 45,000 gas stations, distribution terminals, and countless delivery vehicles that travel through highly populated towns and cities on a daily basis. All of these facilities and transport systems deal with dangerous, volatile, and often hazardous materials. The cases presented here — while certainly not a complete measure of Shell’s entire global system — nonetheless indicate that Shell’s facilities are not as safe and well-managed as they could be. Workers, communities, and the environment are too frequently at risk. The board of directors and management at Royal Dutch Shell, and its affiliate companies and contractors, have not done enough to incorporate fail-safe measures, on-going preventative maintenance, and the absolute latest technology to assure safe operations at all of their production, refining, and stor-age facilities worldwide. Given the level of scrutiny now being undertaken of corporate managements worldwide, and the growing frequency of shareholder and class-action lawsuits to hold management and corporate leaders accountable for either avoidable liabilities and/ or preventable social transgressions, money spent on targeted investment to insure clean and safe operations is certainly well advised. Clearly, "ounces of preventable actions" taken now will trump "bil-lions in court-ordered payouts" as cure — not to mention bad PR. And simply as a matter of good business practice — and lowering the firm’s liability exposure and its insurance rates — Shell should want to be in the vanguard of technological improvement that puts safety on a par with production.

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