Challenge Challenge is a set of safety health and

Challenge 2010 Challenge 2010 is a set of safety, health and environment objectives and milestones Orica has set its sights on for the year 2010. In 2000 we released our Challenge 2005 milestones – a series of specific SH&E objectives to be achieved by the company over the ensuing five years, in order to drive continuous improvement in our Safety, Health & Environment (SH&E) performance. Most of the Challenge 2005 milestones were achieved by 2004 and we are now releasing Challenge 2010 milestones so as to drive our performance forward over the next 5 years. In Challenge 2010 there is a continuing strong focus on safety and health. Primarily this comprises a commitment to prevent fatalities, while further reducing injuries and illnesses. Orica has been a leader in safety, however we need to continue progress towards our vision of “No injuries to anyone, ever”. There is also an increased emphasis on environment and product stewardship issues, which are often of particular interest to the community. This comprises a commitment to reduce our impact on the environment, as well as achieve reductions in our consumption of resources. For Challenge 2010, we want to move towards a culture where no significant SH&E incident occurs because procedures were not followed for existing tasks, or a job safety assessment was not completed before undertaking a new task. Collectively these milestones will ensure that we continue to move Orica along the path towards business sustainability. Our framework for sustainability comprises three focus areas: • • • All Worker Safety and Health Community Safety Resource and Operational Sustainability This framework is consistent with the company's SH&E Policy - "We will manage all our activities with concern for people and the environment and will conduct our business for the benefit of society without compromising the quality of life of future generations." The delivery of the required SH&E performance expressed by Challenge 2010 requires the commitment and involvement of everyone in businesses and at sites across the company. Businesses and sites will be required to update their five year or long term SH&E plans to support the objectives and milestones of Challenge 2010. The specific objectives and, where appropriate, measures and milestones of Challenge 2010 are listed on the following pages. If we achieve what we have set out to achieve and reach or pass the milestones, then Orica will be moving towards sustainability, becoming a safer and better place to work with less environmental impact, and will be more highly regarded by the community. October 2004 Page 1 of 13 Challenge 2010 - Objectives, Measures and Milestones (Baseline is 2003/2004) Safety and Health • • • No worker fatalities Reduce the recordable injury and illness case rate by >40% Sustained compliance with our health assessment and occupational hygiene programs Key performance milestones: All worker fatalities: All worker recordable injury and illness case rate: Health assessments completed against plan: Hygiene tests completed against plan: Hygiene tests below the Occupational Exposure Limit (OEL): 0 <0.40 (per 200,000 hours) >99% >99% >99% • Safety All Worker Fatalities 3 2 1 0 2000 2001 2002 2003 2004 Challenge 2010 All Worker Recordable Case Rate 2 1.5 1 0.5 0 2000 2001 2002 2003 2004 Challenge 2010 We have made strong progress over recent years in reducing the numbers of injuries and illnesses amongst our workforce (comprising both employees and contractors). Our primary safety measure of the All Worker Recordable Case Rate (AWRCR) has decreased from 1.38 in 1999/2000 to 0.74 in 2003/2004. Despite this progress however, five company workers have been fatally injured during the last five years. The loss of our colleagues hangs heavily over our safety performance and is a constant reminder that even though our safety statistics are improving year by year, we have a long way to go to achieve our vision of "No injuries to anyone, ever". October 2004 Page 2 of 13 Preventing further fatalities and reducing the recordable case rate by >40% over the next five years will require considerable effort, with a focus on both occupational and operational safety. In addition to maintaining our current focus, we will have to target specific areas of concern such as manual handling, trips and falls, and hand injuries, which collectively account for 75% of all injuries. It will be essential to continue our behavioural safety programs and to put greater emphasis on Job Safety and Environment Risk Analysis (JSERA) and Job Cycle Checks (JCC). We must maintain our awareness and understanding of the risks associated with our activities, ensure the engineering integrity of our plant and equipment, and operate to the highest standards. This will require increased commitment to, and development of, Basis of Safety, hazard studies (project & periodic), audits, design review, and project management. In addition to the specific key performance milestones for fatalities and recordable cases, the company will rigorously monitor and investigate all serious near misses and near hits (General Learning incidents) in order to maintain the focus on prevention of high consequence-low probability events (eg. fatalities, fires/explosions) and reduce the numbers of such incidents occurring. General Learning Incidents (Serious Near Misses) 120 100 80 60 40 20 0 2000 2001 2002 2003 2004 • Health & Hygiene In the 2000 to 2004 period, progress was made in improving the integrity of our health assessment and occupational hygiene programs. It is essential that this good work is reinforced in the next five years. Businesses will be encouraged to maintain targeted health and wellbeing programs relevant to employees and the locations in which they work. As part of Challenge 2010, Orica will develop and apply across its global operations, uniform occupational exposure standards for priority hazardous chemical and physical agents to ensure that all workers receive the same high level of protection. These standards will be determined by reviewing best practice - with scientific validation as appropriate - and in some cases may be more demanding than those required by the countries where we do business. Priority will be given to agents with significant potential for carcinogenesis, sensitisation, neurotoxicity or adverse reproductive effects. In addition to the specific key performance milestones for health assessments and hygiene tests, the company will monitor and track reliance on personal protective equipment (PPE) as a means of exposure control in order to work towards the objective of further understanding the level of dependence. • Driver Safety Driving motor vehicles is one of the most significant risks faced by many of our employees and contractors. The company will strive for continuous improvement in driver safety, via ongoing promotion of voluntary driver safety education programs and monitoring of driver safety performance (as Category 2+ motor vehicle incidents per million kilometres travelled). The company will also endeavour to monitor average vehicle fuel efficiency, as driver safety literature supports a relationship between conservative driving behaviour (as indicated by lower fuel consumption) and reduced crash risk. This measure is also important in monitoring of greenhouse gas emissions from company vehicles (see Resource & Operational Sustainability). October 2004 Page 3 of 13 Challenge 2010 - Objectives, Measures and Milestones (Baseline is 2003/2004) Community Safety • • • • No distribution incident fatalities Reduce the number of serious site losses of containment Reduce the number of serious distribution incidents involving our products No environmental licence non-compliances Key performance milestones: Distribution incident fatalities: (contractor drivers or members of public) Number of site losses of containment (Category 2 or higher): Number of distribution incidents (Category 2 or higher): Number of environmental licence non-compliances: 0 <4 <12 0 Site Losses of Containment 10 8 6 4 2 0 2000 2001 2002 2003 2004 Challenge 2010 Distribution Incidents 35 30 25 20 15 10 5 0 2000 2001 2002 2003 2004 Challenge 2010 October 2004 Page 4 of 13 Distribution Incident Fatalities (contractor drivers & members of public) 6 5 4 3 2 1 0 2000 2001 2002 2003 2004 Challenge 2010 The number of serious site losses of containment and distribution incidents involving our products remains unacceptably high. In some instances, distribution incidents have resulted in fatalities to contractor drivers or members of the public, which is clearly unacceptable. These incidents generally impact on the community, cause business disruption, and can adversely effect the company’s public image. Achieving the 2010 milestones will require rigorous application of our SH&E systems and tools to identify and manage all risks under the company’s control associated with both facility operation and distribution activities. It also needs to be recognised that in some distribution incidents there are some external environmental factors outside the company’s control. Environmental Licence Non-compliances (Category 2+) 120 100 80 60 40 20 0 2000 2001 2002 2003 2004 Challenge 2010 Environmental licence compliance across the company’s operations remains at >99%, however the level of non-compliance at a number of sites remains unacceptably high. The clear expectation of regulatory authorities and the community is that our sites will fully comply with licence requirements. Significant work will need to be undertaken at some sites over the next five years to achieve the 2010 milestone of 100% compliance. In addition to the specific key performance milestones for serious site losses of containment, distribution incidents, and licence non-compliances, the company will continue to monitor and track the performance of the following measures of community safety, in order to work towards the objective of zero occurrences by 2010: • Community Complaints (Category 1) • Fines (Category 2) • Prosecutions (Category 3) • Product Incidents (Category 2) October 2004 Page 5 of 13 • Legacy The company will continue to progress groundwater and land remediation programs associated with the consequences of historical activities at a number of sites, ensuring that regulatory and community expectations are met. This includes maintaining the focus and commitment to completion of major works associated with the Botany site, particularly groundwater remediation and hexachlorobenzene waste destruction. The company will also continue to advance the elimination and reduction of risks associated with underground storage of hazardous materials, in order to prevent future contamination. During the last five years underground storage of hazardous materials has been eliminated at many locations across the company, however further work is required, particularly on elimination of highest risk storage tanks. • Community Relations The company will continue to maintain and develop community relationships, particularly for major sites with neighbouring communities. This will typically comprise site community SH&E reports, formal community relations plans, and informal safety outreach activities. Most major sites are expected to produce annual reports of their SH&E performance directed at their employees and the neighbouring communities. These are tailored to each particular site’s situation and can take various forms (eg. brochure, letter, advertisement in local newspaper, community calendar, etc). All major sites will develop and maintain community relations plans. These plans will give particular emphasis to sharing of information and involvement of the community in SH&E issues to improve the relationship between the company and the community. All businesses, sites, and employees will be encouraged to participate in a variety of informal SH&E outreach activities. These activities may take the form of talks in schools, training programs or demonstrations to customers, presentations to industry peers, and special SH&E programs with family members or the general community (eg. community clean-up days, paint donations to community centres, rural youth driver safety sponsorship). October 2004 Page 6 of 13 Challenge 2010 - Objectives, Measures and Milestones (Baseline is 2003/2004) Resource and Operational Sustainability • • • Reduce energy consumption Reduce emissions of greenhouse gases Reduce water consumption Reduce waste generation • Key performance milestones: (all reductions are on a per tonne of product manufactured basis and are relative to 2004 baseline levels) Reduction in energy consumption: Reduction in emissions of total carbon dioxide equivalent gases: Comprising: - Reduction in emissions of carbon dioxide equivalent gases (excluding nitrous oxide): - Reduction in emissions of nitrous oxide: Reduction in water consumption: Reduction in waste generated: >15% >35% >15% >50% >15% >50% Energy Consumption (GJ/t) 10 8 6 4 2 0 2000 2001 2002 2003 2004 Challenge 2010 In 2003/2004 the company’s operations consumed 23,449 TeraJoules (TJ) of energy, with natural gas for ammonia production accounting for approximately 87% of this total and electricity use accounting for 10%. Large energy users such as Orica will continue to receive increased scrutiny from regulators and the community as sustainability issues develop further in coming years. While the company achieved an 18% reduction in energy usage per tonne of production between 2000 and 2004, achieving a further 15% reduction by 2010 will require a significant commitment. October 2004 Page 7 of 13 Water Consumption (kL/t) 5 4 3 2 1 0 2000 2001 2002 2003 2004 Challenge 2010 In 2003/2004 the company’s operations consumed 11,346 million litres of water. Pressures around consumption of water will increase in coming years as the limitations around sustainable use of this precious resource continue to be understood and appreciated by the wider community. The company achieved a 23% reduction in water consumption per tonne of production between 2000 and 2004, and maintained focus will be required to achieve a further 15% reduction by 2010. CO2 Emissions (t/t) (excludes N 2 O) 0.6 0.5 0.4 0.3 0.2 0.1 0 2000 2001 2002 2003 2004 Challenge 2010 In 2003/2004 the company’s operations emitted 1,840 kilotonnes of carbon dioxide from energy use, representing a 27% reduction in emissions per tonne of production between 2000 and 2004. This data does not include emissions of nitrous oxide from nitric acid manufacture, which currently account for an estimated additional 2,640 kilotonnes of carbon dioxide equivalent emissions per annum. Community and regulatory attention to emissions of greenhouse gases such as carbon dioxide and nitrous oxide will continue to intensify in coming years as concern about global warming is maintained and progress against the Kyoto Protocol reduction commitments by 2008 – 2012 are assessed. Considerable effort will be required to achieve the company’s 2010 milestones of a 50% reduction in emissions of nitrous oxide and a 15% reduction in emissions of carbon dioxide (equating to a combined reduction of 35% in total carbon dioxide equivalent emissions). Waste (solid & emissions) (t/kt) 7.5 6 4.5 3 1.5 0 2004 (solid) Challenge 2010 (solid) 2004 (emissions*) Challenge 2010 (emissions*) Note: Emissions includes waste discharges via air & water, however not all emissions via water are currently measured. October 2004 Page 8 of 13 In 2003/2004 the company’s operations generated an estimated 30,200 tonnes of solid waste and emitted 6,600 tonnes of waste to air and water. It should be noted that the solid waste is an estimate believed to be about 75% accurate and that not all emissions to water are currently measured. The company has not previously collected and reported waste generation data from all operations. Some sites have made significant progress in reducing waste generation during recent years, however there is a need to focus and drive reduction efforts on a company wide basis. The 2010 milestone of a 50% reduction is consistent with community expectations, growing pressures on landfill facilities, and the principles of sustainability. Effective performance measurement of energy consumption, greenhouse gas emissions, water consumption, and waste generation across the company requires consistent reporting by sites. Large sites representing >90% of the company’s total consumption and emissions are required to report on a monthly basis, while all other sites are required to report every six months. Appendix 3 contains a listing of site reporting requirements. • Emission Standards During this period Orica will assess and review environmental emission levels for priority chemical releases from its operations. The review will consider best practice - with scientific validation as appropriate - to ensure that the environment receives a high level of protection throughout the company’s operations across the globe. Priority will be given to new plants and targeting priority chemicals (eg. carcinogens, greenhouse gases) at existing plants. • Sustainability The company has continued to make good progress in decreasing our impact on the environment and reducing our consumption of valuable resources such as energy and water. However, in order to continue the transformation towards a truly sustainable company, significant effort is required in the years ahead. Achieving these milestones will necessitate considerable expertise, and in some cases, investment in capital and/or technology enhancements. Such achievements are expected to be consistent with societal expectations and to ultimately provide opportunities for the future in developing sustainable businesses. The data from resource and operational sustainability progress, will be used in calculating and monitoring the company’s progress via our Sustainability Index (V/I). • Product Stewardship Product stewardship remains an important focus for the company over the next five years, supporting both community safety and sustainability improvements. A high level of compliance with the company’s product stewardship index has been maintained over the last five years, and life cycle risk assessments have been completed for a number of major product groups. The company will strive to maintain and extend this performance, via regularly reviewed product stewardship plans. October 2004 Page 9 of 13 Appendix A: Historical Performance & Challenge 2010 Milestones 2000 2001 2002 2003 Actual Actual Actual Actual ALL WORKER SAFETY & HEALTH SAFETY All Workers Fatalities Recordable case rate Lost workday case rate Employees Fatalities Recordable case rate Lost workday case rate Contractors Fatalities Recordable case rate Lost workday case rate HEALTH Health Assessments % Plan Completed Hygiene Performance % Plan Completed % Tests Below OEL MAJOR INCIDENTS General Learning Category 3 & 4 Site Losses of Containment Category 2, 3 & 4 Distribution Incidents Category 2, 3 & 4 Fatalities (contractor drivers & members of public) 2004 Challenge Actual 2005 Challenge 2010 2 1.38 0.38 2 1.26 0.35 0 1.85 0.39 0 1.46 0.40 0 1.41 0.38 0 1.72 0.48 1 1.12 0.31 1 1.02 0.27 0 1.73 0.58 1 1.08 0.34 1 0.94 0.28 0 1.88 0.67 1 0.74 0.23 0 0.66 0.20 1 1.06 0.38 1.00 0 0.40 0.63 97.8% 95.3% 97.2% 98.0% 99.1% 97.3% 98.0% 95.9% 97.8% 99.0% 96.3% 97.2% 95.8% 96.8% 98.0% >99% >98% >99% >99% >99% 78 104 60 75 COMMUNITY SAFETY 4 25 2 3 41 10 1 2 0 13 1 4 71 7 0 0 3 29 0 13 55 15 1 0 84 8 23 5 3 44 28 0 3 5 24 2 10 108 15 2 2 4 12 4 12 0 Product Incidents Category 2 Licence Non-compliance Category 2 & 3 Community Complaints Justified Category 1 Fines >$5,000 Category 2 Prosecutions Environmental Category 3 0 October 2004 Page 10 of 13 RESOURCE & OPERATIONAL SUSTAINABILITY Energy % Reduction (2000 base year) -0.4% -2.8% +0.5% -18.2% 5.30 Consumption (GJ/t production) 6.48 6.46 6.30 6.51 Carbon Dioxide (CO2e) Total CO2e % Reduction Emissions (t/t production) 1.02 Total CO2e excl. Nitrous Oxide % Reduction (2000 base year) -3.0% -4.0% -13.7% -26.8% 0.49 0.42 Emissions (t/t production) 0.57 0.55 0.54 Nitrous Oxide (as CO2e) % Reduction 0.60 Emissions (t/t production) Water % Reduction (2000 base year) -5.6% -9.8% -9.8% -23.4% Consumption (kL/t production) 2.57 3.35 3.16 3.02 3.02 Waste % Reduction Solid (t/kt production) 6.8 Emissions (t/kt production) 1.5 -10% -15% (2004 base year) -35%* -10% -15%* -50%* (* 2004 base year) -10% -15% (2004 base year) -50% (2004 base year) October 2004 Page 11 of 13 Appendix B: Definitions All Workers: Employees and contractors. Recordable Case: A significant work related injury or illness. Includes fatalities, lost workday cases, restricted work cases, and medical treatment cases. Recordable Case Rate: Represents the number of recordable cases per 200,000 hours (hours worked by 100 workers per year). Health Assessment: Health assessment programs are tests designed to evaluate the fitness of individuals to perform specific tasks, and/or to monitor for health effects from exposure to specific substances. Hygiene Tests Below Occupational Exposure Limit (OEL): The Occupational Exposure Limit (OEL) is the concentration of an airborne substance, below which the majority of workers can be safely exposed to during their working life, without causing adverse health effects. Hygiene tests are samples of air in the breathing zone of workers, designed to assess compliance with OELs. General Learning Incidents (Category 3 & 4): Near hits, near misses, and unusual incidents. An event with no adverse outcomes or relatively minor outcomes (eg. minor injuries, small spills, plant upsets) that could have had much more serious consequences. Site Loss of Containment (Category 2, 3 & 4): Significant and serious unplanned losses of containment (spill, leak, emission) from company sites that cause injury, damage, community concern, or attract media attention. Distribution Incidents (Category 2, 3 & 4): Significant and serious incidents arising from transport or storage of materials or products owned by the company that cause injury, damage, community concern/disruption, or attract media attention. Product Incident (Category 2): A consumer or post consumer incident with SH&E implications that involves a company product after delivery to a customer. Licence Non-compliance (Category 2 & 3): An excursion outside environmental discharge or emission limits that must be reported to a statutory authority. Community Complaints (Category 1): A justified complaint from a member of the public that did or could have arisen as a result of the company’s operations. Fines (Category 2): A minor citation or formal warning from an authority or statutory body (eg. on the spot fine). Prosecutions (Category 3): A significant prosecution, usually involving a court appearance. Carbon Dioxide Equivalent (CO2e): The amount of carbon dioxide and nitrous oxide gases emitted from company operations, expressed as a total carbon dioxide equivalent, based on the global warming potential of each gas. October 2004 Page 12 of 13 Appendix C: Resource Reporting Requirements by Site Effective performance measurement of energy consumption, greenhouse gas emissions, water consumption, and waste generation across the company requires consistent reporting by sites. Large sites representing >90% of the company’s total consumption and emissions are required to report into the company’s SH&E information system (SHERMIS) on a monthly basis (first week after month end), while all other sites are required to report every six months (first week of April and first week of November). Monthly Energy, Greenhouse Gas, & Water Reporting Chemicals: Botany ChlorAlkali, Deer Park Adhesives & Resins, Hornby, Kinleith, Laverton ChlorAlkali, Laverton Marplex, Morrinsville, Mt Maunganui Adhesives & Resins, Mt Maunganui Chemnet, Port Kembla, Samarinda, Yarwun Mining, Yarwun ChlorAlkali Consumer Products: Clayton Powders, Glenfield, Gracefield, Padstow, Rocklea, Wyee Incitec Pivot: Cockle Creek, Geelong, Gibson Island, Kooragang Island Fertilisers, Pinkenba, Port Adelaide, Portland Mining Services: Brownsburg, Carseland, Cuatrocienegas, Gomia, Kooragang Island Nitrates, Limay, Lorena, Monclova, Seneca, Troisdorf, Wurgendorf, Yarwun Nitrates All other sites to report every six months. Monthly Waste Reporting Chemicals: Banksmeadow, Botany ChlorAlkali, Deer Park Adhesives & Resins, Hornby, Kinleith, Laverton ChlorAlkali, Laverton Marplex, Morrinsville, Mt Maunganui Adhesives & Resins, Mt Maunganui Chemnet, Port Kembla, Timaru, Yarwun Mining, Yarwun ChlorAlkali Consumer Products: Beverley, Clayton Powders, Glenfield, Gracefield, Padstow, Rocklea, Wyee Incitec Pivot: Cockle Creek, Geelong, Gibson Island, Kooragang Island Fertilisers Mining Services: Brownsburg, Cuatrocienegas, Gomia, Helidon, Kooragang Island Nitrates, Limay, Lorena, Seneca, Troisdorf, Wurgendorf, Weihai, Yarwun Nitrates All other sites to report every six months. October 2004 Page 13 of 13