Sydney Harbour Oil Spill in August 1999

by Helen Morgner

Background

Located in Greenwich in Sydney Harbour, Australia, Shell's Gore Bay Terminal is a receiving and storage facility which provides all of the crude oil for Shell's Clyde refinery in Sydney. The terminal, which has been operated by Shell since it was opened in 1901, receives between 85 and 100 ships a year.

Ships offload about four million tonnes of crude oil and other petroleum products which are transferred to Clyde by underground pipeline. The Clyde refinery supplies 50 percent of New South Wales' (NSW) fuel market and represents about one third of Shell's oil products business in Australia.

Gore Bay and other commercial activities in Sydney Harbour have been continually targeted by pressure groups who believe commercial activity is a threat to the harbour's value as an international tourist destination. These groups argued that commercial shipping should be removed and the harbour reserved for recreational use only. Shell and others maintained that Sydney Harbour has always operated as a working harbour and should continue as such.

Aware that the risk of a spill or other environmental problem could threaten Gore Bay's licence to operate, Shell's External Affairs team devised a stakeholders' communications plan in the late 1980s. This involved creating and maintaining a community consultative committee with local residents and other interested groups. The plan also involved Shell staff building dialogue channels with NSW politicians and key public servants about company activities.

The Crisis

On the evening of Tuesday 3 August 1999, the Italian oil tanker "Laura D'Amato" was discharging its crude oil cargo at Shell's Gore Bay Terminal in Sydney. For reasons unknown at the time, 300 tonnes of oil was spilled into the harbour at 6.25pm.

Sydney harbour during the oil spill in August 1999.
Photo: Shell Australia Limited.

The spill seriously threatened Shell's reputation and business. Mishandled, the crisis could ruin stakeholder relations and encourage the government to stop commercial shipping in Sydney Harbour. A halt on shipping would directly affect Shell's Gore Bay terminal and Clyde refinery which supplies fifty percent of New South Wales' fuel requirements.

Crisis Plan Implementation

One hour after the spill occurred, Shell Australia's External Affairs team had assembled and began executing the crisis communication plan. Twenty four hour coverage was provided by the team for the first three days following the spill.

• Media - Shell held a press conference at the site only three hours after the spill was first discovered. The first media release was widely distributed shortly afterwards. A series of six media releases followed over the next two days as the crisis developed. Background information sheets on Gore Bay Terminal and Shell's shipping operations were also sent to all media. Shell spokespeople were pro-actively offered for radio and television interviews, media briefings, one-to-one phone conversations and personal interviews throughout the crisis.

• Government - Shell staff contacted senior advisers for the relevant ministers and government departments on the night of the spill. The next day, personal briefings by Shell senior management were instigated, including a briefing for the NSW Premier by Shell's CEO. Follow-up letters with additional background information were sent to all government contacted. Shell also initiated the offer to co-operate fully with a government inquiry.

• Stakeholders - A personal letter from the Gore Bay Terminal manager was hand-delivered to local residents before dawn on August 4. Three follow-up letterbox drops were organised over the next week. Non-government organisations (NGOs) were contacted by phone to discuss the spill.

• Employees - An e-mail to all Shell Australia staff was distributed at 3am on the night of the spill so employees were updated as soon as they arrived at work the next day. Follow-up voice mail messages and e-mails were sent to all staff informing of them of developments over the next week. After the oil spill clean up, a letter of appreciation was sent to all employees and contractors involved.

• General public and customers - Additional staff were employed at Shell's Clyde refinery to handle the increased number of switchboard calls from the general public. Shell's customer service centre was fully briefed on how to respond to oil spill queries from customers. All media releases were posted on Shell's Internet web site. The media releases web page received 300 percent more hits in August than the normal monthly average.

Evaluation

Shell received widespread praise on its response to the crisis. There was no discernible impact on sales during the crisis, long-term business damage was avoided and Shell's reputation with stakeholders was actually enhanced.

Support from the local community was immense. Many residents and local groups openly praised Shell's involvement and relationship with them. After the crisis, Shell recorded higher than average attendance at the community consultation committee meetings and the next Gore Bay Terminal open day.

During and after the crisis, the NSW Premier Bob Carr announced that Sydney is, and will continue to be, a working harbour that allows commercial shipping traffic. He ruled out closing Sydney Harbour either permanently or temporarily and said moving Gore Bay Terminal was not an option. Today, Gore Bay continues to operate as a receiving and storage facility for Shell.

About the author

Helen Morgner is the External Affairs Officer at Shell Australia Limited, Melbourne, Victoria, Australia. E-Mail: Helen.LF.Morgner@Shell.com.au.

First published in Crisisnavigator (ISSN 1619-2400):
Volume 2 (2001) - Issue 1 (January)