Registration document 2007 - Total.com
Registration document 2007 - Total.com
Registration document 2007 - Total.com
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4<br />
Types of Risks<br />
TOTAL’s activities involve certain industrial and environmental<br />
risks which are inherent in the production of products that are<br />
flammable, explosive or toxic. Its activities are therefore subject to<br />
extensive government regulations concerning environmental<br />
protection and industrial safety in most countries. For example, in<br />
Europe, TOTAL operates sites that meet the criteria of the<br />
European Union Seveso II directive for classification as high-risk<br />
sites. Other sites operated by TOTAL in other parts of the world<br />
involve similar risks.<br />
The broad scope of TOTAL’s activities, which include drilling, oil<br />
and gas production, on-site processing, transportation, refining,<br />
petrochemicals activities, storage and distribution of petroleum<br />
products, production of base chemical products and specialty<br />
chemicals, involve a wide range of operational risks. Among<br />
these risks are those of explosion, fire or leakage of toxic<br />
products. In the transportation area, the type of risks depends<br />
not only on the hazardous nature of the products transported,<br />
but also on the transportation methods used (mainly pipelines,<br />
maritime, river-maritime, rail, road), the volumes involved, and the<br />
sensitivity of the regions through which the transport passes<br />
(population density, environmental considerations).<br />
Most of these activities involve environmental risks related to<br />
emissions into the air, water or soil and the creation of waste,<br />
and also require environmental site restoration after production is<br />
discontinued.<br />
Certain branches or activities face specific risks. In oil and gas<br />
exploration and production, there are risks related to the physical<br />
characteristics of an oil or gas field. These include eruptions of<br />
crude oil or of natural gas, discovery of hydrocarbon pockets<br />
with abnormal pressure, crumbling of well openings, leaks<br />
generating toxic risks and risks of fire or explosion. All these<br />
events could possibly damage or even destroy crude oil or<br />
natural gas wells as well as related equipment and other<br />
property, cause injury or even death, lead to an interruption of<br />
activity or cause environmental damage. In addition, since<br />
exploration and production activities may take place on sites that<br />
are ecologically sensitive (tropical forest, marine environment,<br />
etc.), each site requires a specific approach to minimize the<br />
impact on the related ecosystem, biodiversity and human health.<br />
TOTAL’s activities in the Chemicals segment and, to a lesser<br />
extent, the Downstream segment may also have health, safety<br />
and environmental risks related to the overall life cycle of the<br />
products manufactured. These risks can arise from the intrinsic<br />
characteristics of the products involved, which may, for example,<br />
be flammable, toxic, or linked to the greenhouse gas effect. Risks<br />
of facility contamination and off-site impacts may also arise from<br />
emissions and discharges resulting from processing or refining,<br />
84<br />
Risk Factors<br />
Industrial and environmental risks<br />
Industrial and environmental risks<br />
TOTAL – <strong>Registration</strong> Document 2006<br />
and from recycling or disposing of materials and wastes at the<br />
end of their useful life.<br />
Risk evaluation<br />
Prior to developing their activities and then on a regular basis<br />
during the operations, business units evaluate the related<br />
industrial and environmental risks, taking into account the<br />
regulatory requirements of the countries where these activities are<br />
located.<br />
On sites with significant technological risks, analyses are<br />
performed for new developments, updated in case of planned<br />
significant modifications of existing equipment, and periodically<br />
re-evaluated. To harmonize these analyses and reinforce risk<br />
management, TOTAL has developed a group-wide methodology<br />
which is being implemented progressively throughout the sites it<br />
operates. In France, three pilot sites are developing Risk<br />
Management Plans pursuant to the French law of July 30, 2003.<br />
These plans will implement various urbanization measures to<br />
reduce risks to urban environments surrounding industrial sites.<br />
The texts implementing these aspects of the law of July 30, 2003<br />
were published at the end of 2005 and during 2006.<br />
Similarly, environmental impact studies are done prior to any<br />
industrial development with a thorough initial site analysis, taking<br />
into account any special sensitivities and plans to prevent and<br />
reduce the impact of accidents. These studies also take into<br />
account the impact of the activities on the local population,<br />
based on a <strong>com</strong>mon methodology. In countries where prior<br />
authorization and supervision is required, the projects are not<br />
undertaken without informing the relevant authorities of the<br />
studies.<br />
For new products, risk characterizations and evaluations are<br />
performed. Furthermore, life cycle analyses for related risks are<br />
performed on certain products to study all the stages of a<br />
product’s life cycle from its conception until the end of its<br />
existence.<br />
TOTAL’s entities actively monitor regulatory developments to<br />
<strong>com</strong>ply with local and international rules and standards for the<br />
evaluation and management of industrial and environmental risks.<br />
The Group’s environmental contingencies and asset retirement<br />
obligations are discussed in Note 19 to the Consolidated<br />
Financial Statements, page 207). Future expenses related to asset<br />
retirement obligations are accounted in accordance with the<br />
principles described in Note 1Q to the Consolidated Financial<br />
Statements (page 178).