The Algerian gas plant hostage crisis has yet again highlighted the vulnerability of Oil & Gas plants around the world. Although a wide majority of attacks on Oil & Gas incidents have happened in the Middle East and North Africa recently, the global nature of the Oil & Gas industry and the impact it has on global economies demands that serious consideration is given to securing critical infrastructure. Pipelines in the United States to refineries in China and other Oil & Gas infrastructure around the world face varying threat levels that range from information theft to a terrorist attack. The economic impact and financial damage of such attacks are significant. Being situated in remote locations should be a cause to invest in securing these infrastructures rather than an excuse for not having adequate security.
Energy facilities have become favorable targets for dissident groups due to the increasing attention of world leaders towards Oil & Gas, as consumption outstrips supply. Terrorist groups are taking advantage of this situation to achieve their goals and gather greater publicity towards their organisations. However, the attacks on Oil & Gas infrastructure are not new. There have been numerous attacks on Oil & Gas infrastructure in the Middle East since 1968. In 1975, the Arab Revolution terrorist group seized more than 70 hostages from the OPEC headquarters in Vienna demanding over $50 million to release them. Since 9/11, pipelines, tankers, refineries and oil terminals have been attacked frequently across Iraq.
Oil tankers have been a target for terrorists even in Sri Lanka and in Israel. One of the biggest but failed sabotages was that of Ras Tanura in Saudi Arabia in 2002 which if successful, could have impacted over 10% of the world’s oil supply. The recent incident in Amenas has left oil companies thinking about the risk of doing business in the highly volatile regions of this world whilst dealing with the everyday risks and security threats that their infrastructure face.
Short Term Investments in Security and Deterrence to Yield Long Term Benefits
Although the vulnerable nature of Oil & Gas infrastructure has been driving security investments recently, there is still a long way to go in terms of achieving fail proof levels of security and deterrence. Adding to the woes of the operators is the increasing multitude of threats - both physical as well as cyber threats. There is a growing preference for total solutions with flexible integration of individual security systems like access control, video surveillance and intrusion-detection on one platform. Heavy investments in cyber security are also projected due to various attacks on energy facilities in the past five years. A simple analysis reveals several loopholes in the current situation:
1. Porous borders allowing terrorists from neighboring unstable countries to get through undetected to carry out such attacks,
2. Lack of a layered security approach and perimeters to prevent unauthorized entry to critical facilities.
3. Lack of technology to provide early warning and detection of threats.
4. Lack of tools to provide a coordinated response to cyber-physical threats.
5. And finally, the lack of a dedicated security force to protect critical infrastructure.
Adopting a Proactive Approach to Security
There is much that needs to be done to change the way security is perceived and practised by Oil & Gas companies and governments of OPEC countries around the world. Both public and the private sector should work closely to adopt a more proactive approach to securing critical infrastructure than the current reactive situations that we see, including:
1. Conducting and subscribing to socio-political risk assessments and alerts and carry out continuous assessment to measure impact on business operations.
2. Addressing porous border issues in the evidence of terrorist movements across borders.
3. Expanding and securing the perimeters of critical sites to allow a multi layered early detection, warning, deterrence and delay based solution to identify and deal with threats and adopting the use of advanced technology (sensors etc) for early detection of threats, securing pipelines etc.
4. Companies also need to address the security gaps that evolve due to convergence of cyber physical threats.
5. Creating a dedicated critical infrastructure security force to deter and counter such attacks against critical infrastructure.
The current situation in Algeria has not only elevated the risk profile of the region but has also highlighted the vulnerability of these sites yet again. Given that most of the OPEC countries are volatile and have a high risk profile, a global, co-ordinated, and technologically advanced security strategy is required to tackle issues including terrorism against Oil & Gas infrastructures around the world to ensure continuity of supplies.
Balaji Srimoolanathan is principal consultant for security at market research company Frost & Sullivan