Risk assessment—an insurer's perspective

Safety in Offshore Platforms—Use of QRA in the Norwegian Offshore Industry

Risk assessment is an effective and commonly practiced process in industry, including oil and gas sector, as a basis for designing new pipeline terminals and stations and managing integrity of existing facilities. A holistic risk assessment method, which could be qualitative or quantitative, includes both the likelihood and consequence assessments of an undesired event. Prior to 2015, Enbridge Pipelines employed a qualitative risk assessment algorithm to assess the likelihood and consequence of a failure of liquids pipeline facilities. Over the past decade Enbridge has identified a number of shortcomings with the qualitative approach, necessitating the development and use of Quantitative Risk Assessment (QRA) to support consistency and defensibility in risk-informed decision making. A QRA requires rigorous quantitative algorithms to measure public and environmental safety, and potential business consequences of an undesired event at a facility. While significant literature has been produced, and considerable effort has been expended to quantify the potential impacts of a flammable product release on public safety, very limited work has been done on the quantitative measurement of environment related impacts. In particular, limited research has been successful in aggregating environmental consequences, public safety and business consequences to estimate the total consequence of a liquid hydrocarbon release within a pipeline facility. The consequence assessment of an unwanted event conducted through QRA can be combined with the associated likelihood to provide a quantitative measure of risk. This risk level may be used to support organizations in making risk informed decisions and in analyzing and treating facility risks, specifically in the: • Identification of top risk facilities and high consequence functional areas; • Identification of assets posing the most risk and worst case consequences; • Understanding of system reliability risk and opportunities to optimize facility operation; • Prioritization of facility maintenance projects in the capital and operating budget processes; • Supporting regulatory requirements and expectations; • Presentation of risk down to the equipment or component level; and • Understanding of residual risk and achieved risk reduction. This paper describes the development of a consequence model that monetizes the quantitative measure of public and environment safety, and potential business losses for a liquid product release at pipeline facilities. The proposed model characterizes the severity of impact of released product, expressed in dollars per event, as a function of system volume, proximity and category of receptors, asset location, and available controls.

The effective mitigation of landslide risk requires analytical approaches. In qualitative risk assessment, the components of risk, which are hazard, elements at risk and vulnerability, are expressed verbally and the final result is in terms of ranked or verbal risk levels (IUGS 1997). Qualitative risk assessment is subjective in nature. Quantitative risk assessment involves quantification of risk components and computation of risk. The purpose of quantitative risk assessment (QRA) is to calculate a value for the risk to enable improved risk communication and decision-making (Lee & Jones 2004). For landslides, the use of quantitative risk assessment procedures is recommended. Several frameworks for QRA have been proposed by many experts and organizations (e.g. Varnes 1984, Whitman 1984, Einstein 1988, Fell 1994, Wu et al. 1996, Morgenstern 1997, Fell & Hartford 1997, Einstein 1997, Aleotti & Chowdhury 1999, Ho et al. 2000, Roberds 2001, Dai et al. 2002, Nadim & Lacasse 2003, Lee & Jones 2004, IUGS 1997, AGS 2000, NRC Transportation Research Board 1996, GEO 1998). The QRA frameworks have common intention to find answers to the following questions (Ho et al. 2000, Lee & Jones 2004):1 What are the probable dangers/problems? [Danger Identification]2 What would be the magnitude of dangers/problems? [Hazard Assessment]3 What are the possible consequences and/or elements at risk? [Consequence/Elements at Risk Identification]4 What might be the degree of damage in elements at risk [Vulnerability Assessment]5 What is the probability of damage? [Risk Quantification/Estimation]6 What is the significance of estimated risk? [Risk Evaluation]7 What should be done? [Risk Management]Depending on the characteristics of a landslide, available data, scale of investigation and nature of consequences, the QRA frameworks may differ. Hazard assessment for a specific slope usually involves probabilistic analysis of the given slope, while hazard assessment for a region generally requires the computation of frequency of the landslides in the region. The probabilistic models used for a specific slope depend on the failure mechanism (flows, falls or slides) and slope material (soil or rock). Furthermore, the characteristics of a landslide and scale of investigation influence the consequence/elements at risk, vulnerability, risk quantification/assessment, risk evaluation and risk management. Two important aspects of QRA for landslides are the lack of wellestablished acceptable risk criteria and methods forABSTRACT: Two important aspects of quantitative landslide risk assessment, vulnerability and acceptable risk, are studied as part of a new Integrated Risk Assessment Framework (IRAF). IRAF consists of four steps: data collection, hazard assessment, vulnerability assessment, and risk assessment. Data collection involves obtaining the appropriate data for the hazard, vulnerability and risk assessments. The hazard component integrates the numerical and probabilistic analyses to exploit the added knowledge from the two approaches. A new 3-dimensional framework for quantification of vulnerability is proposed. The fourth component of IRAF is risk assessment, with the computation and evaluation of the risk based on some acceptability criteria. IRAF is implemented for rock slopes. To define an acceptability criterion, published data were collected. Various terminology relating to acceptable risk used in the literature, such as acceptable vs. tolerable, specific vs. total, voluntary vs. involuntary and individual vs. societal, are discussed.

Application of in vitro skin penetration measurements to confirm and refine the quantitative skin sensitization risk assessment of methylisothiazolinone

Using quantitative risk assessment in the chemical process industry

The use of quantitative risk assessment in HACCP

_ This article, written by JPT Technology Editor Chris Carpenter, contains highlights of paper SPE 220333, “Quantitative Risk Assessments: Why They Fall Short and How To Use Them Better,” by Peter A.R. Hudson, SPE, and Timothy G.L. Hudson, SPE, Hudson Global Consulting. The paper has not been peer reviewed. _ This paper discusses the limitations of quantitative risk assessment (QRA) with respect to the usefulness of the concept in managing day‑to‑day and emerging risks and the effect of change. The current use of QRA creates a mismatch between the management of risks on paper and real‑world situations. This paper proposes updating QRA by transforming it into an active management tool linked to proactive management of risks through bowtie and similar models. Challenges of QRA The purpose of QRA is to establish a number that represents the likelihood of incidents and to undertake measures that mitigate risk to within an acceptable level. In a range of industries, it can be observed that what are presumed to be very unlikely events, based on QRA reports, nevertheless appear to occur with regularity. Major events, such as refinery explosions and rail fires, in theory, should occur so rarely that a single instance should not be expected. In oil and gas, the expected rate of fires and explosions is approximately one incident per 10 years per refinery. This is orders of magnitude away from the intended level. Hyperbolically, it should be closer to once in the lifetime of the universe. One real‑world example is the Texas City refinery explosion on 23 March 2005 that resulted in the deaths of 15 people and 170 injuries. Shortcomings in that incident included overreliance within QRA on historical data that did not reflect the unique conditions and actual operations at the refinery. The QRA underestimated the likelihood of organizational and human‑error deficiencies, which were significant contributors to the incident. The QRA used simplified assumptions that failed to capture the complexity of the refinery’s operations and the scale of catastrophic failure modes. An example from the nuclear industry is the Fukushima Daiichi nuclear disaster on 11 March 2011. Following a massive earthquake and tsunami, the cooling systems at the nuclear plant failed, leading to a core meltdown in three reactors, extensive radioactive contamination, and significant evacuation zones. The QRA underestimated the risks because of several factors, including the natural hazard, the effectiveness of redundancy systems, and the effect of organizational and regulatory failures. The QRA assumed that redundancy systems would function correctly without considering how a single event might cause simultaneous failures. These examples demonstrate that discrepancies between predicted failure rates or rates of negative outcomes from QRA and actual failure rates can be attributed to several factors. These factors include limitations in data, modeling assumptions, human factors, unforeseen events, and the complexity of real‑world operations. An appendix is included in the complete paper to ensure that unfamiliar readers understand the basic concepts of QRA and understand forms of data and sources for such data.

Attention to be paid to the aging of industrial facilities has been growing in the last ten years, both by public authorities and industrial executives. Many process plants, operating in Europe, have reached or exceeded their project nominal life and the safe management of aging is an urgent question. Failures, due to aged chemical process plants, cause the release of hazardous materials with severe consequences for people and workers. To counteract this phenomenon, plant operators carry out many technical activities, including non-destructive controls on piping and vessels, by adopting sophisticated methods (e.g. Risk Based Inspection RBI). The European Directive 2012/18/UE (Seveso III) for the control of Major Accident Hazard (MAH) introduced a few requirements for the safe aging of critical equipment, which must be verified during mandatory audits. The aim of this work is to present a synthetic methodology that can be useful for both Seveso auditors and industrial managers for evaluating the adequacy of the measures to control the aging of critical equipment. To achieve a synthetic assessment of the adequacy of the aging management programs, a compensated index method has been developed, which is a simple and easy-to-use tool. The use of an index method inevitably introduces a degree of uncertainty. However, if it is compared to other qualitative methods, such a tool offers the advantage of a major clarity in the assessment process. This paper discusses a practical application of the method within inspection programs, as required by the art. 27 of Seveso III Directive.

The degradation of onshore process plants due to ageing-related mechanisms such as corrosion, erosion and fatigue is becoming a key issue at a worldwide scale. Despite its increasing importance, ageing issues are seldom incorporated or anchored in a company’s Management System. This limited engagement of the onshore process industry towards ageing issues is to a large extent due to the absence of a governing legal framework, which otherwise is in place for offshore facilities, power plants and nuclear plants. The latter are under more scrutiny as the accompanying external, economic and environmental risks are more pronounced as compared to onshore process plants. A recent HSE study however demonstrated that risks related to ageing onshore plants are far from negligible: roughly 60% of all loss of containment incidents are related to technical integrity issues, 50% of which have ageing as a contributory factor. This triggers the need to establish a Plant Lifetime Management methodology, accounting for ageing issues in this industry sector. The overall approach for Plant Lifetime Management as described here contributes not only to the prevention and control of major accident hazards but, allows also for prioritization of investment efforts and, hence, sound decision-making with respect to managing critical assets. This paper presents a new screening tool to assess the adverse impact of ageing on global plant performance and the collateral impact on major accident prevention programs. The newly developed BIP Scorecard (Business Impact Potential) provides a Predictive Ageing Score, composed of a set of 50 performance indicators (leading & lagging) which altogether leads to a risk profile which values the adverse effects of ageing. This paper also highlights a new approach for Plant Criticality Analysis, designed to enable asset risk managers to prioritize their financial investments. This criticality assessment is consequence based only and allows for a first criticality ranking at 2 levels: 1) a high level screening at plant level (full scope) identifying the most critical units in the entire plant, and 2) a focused screening at unit or equipment level (reduced scope) allowing to identify the most critical equipment in a specified unit or critical components in a specified equipment. A subsequent risk assessment for the highest ranked assets considering the probability of failure of these target assets leads to a list of critical assets (risk based). These critical assets are the ones to be further considered in investment decisions and for establishing asset life plans.

Risk assessment in support to land-use planning in Europe: Towards more consistent decisions?

Alarm systems play an important role in assisting the operator to maintain the safe operation of process plant. Poor alarm system performance can result in critical events being missed by the plant operator, and there have been several cases of this contributing to major plant accidents. Consequently the design and management of alarm systems is receiving increasing attention. This could include those involved with assessing and reviewing plant for compliance with the COMAH (Control of Major Accident Hazard) Regulations. This paper summarises some results of a survey of alarm systems in chemical and power plants that was carried out on behalf of the UK Health and Safety Executive. It also describes work that is taking place within EEMUA (The Engineering Equipment and Materials Users Association) to write industry guidance on alarm systems.

This paper focuses on the regulation of environmental hazards—with a particular emphasos on the British style of policy-making. Following a literature review, the case of major hazard policy and the Advisory Committee on Major Hazards in explored in some detail. The relationship of this case to the BRitish policy style is noted. The stress of the committe on pragmatism is discussed as is the linkate between this regulatory philosophy and the use of technical expertise as a source of legitimation. This claim to legitimation is made despite technical limitations in the selected criteria for hazard control. The paper concludeds with a discussion of pragmatism, effectiveness and the emergence of new demands for a change in the British environmental policy process. In particular, it is argued that whilst the proponents of the current system may place great stress on its pragmatism, critics are likely to be more sceptical of the regulatory process and its consensual assumptions.

Small enterprises and major hazards: How to develop an appropriate safety management system

For decades now the oil companies and the communities they operate in the vicinity of have had a kind of love-hate relationship with many ups and downs on the way. On the one hand the communities love the economic benefit and regional advancement that the oil companies bring in their wake while on the other they decry the real as well as imaginary environmental, health or safety related threats posed by the oil, gas and petrochemical plants operating in their midst. As the population increases with time so does the demand for land required for urban development. This by necessity results in building of residential and commercial areas in close proximity of process plants, refinery and other oil handling facilities. This paper highlights the need for mutual cooperation that must exist amongst all parties concerned: the Company, the urbanization and planning bodies, community leaders, public servants, journalists and industrialists. This cooperation can only materialize through mutual trust which in turn can only be generated through a better understanding by all of the actual risks associated with various oil refining and oil handling facilities and the risk mitigation measure that the Company employs to ensure all real risks are reduced to a level as low as is reasonably practicable. The concept of "zero-risk" being attainable in a process environment is infeasible. For land use decision-making we must apply formal techniques of quantitative risk assessment (QRA) and other recognized risk evaluation methods that are being used by many government organizations in Europe and North America. The UK Health and Safety Executive (HSE) have issued quite comprehensive guidelines on this topic which have found acceptance worldwide. This paper briefly explains how the QRA technique works and provides several real life examples of use of QRA in land use planning in Bahrain. There is an immediate need for rational risk mitigation by the Company and rational risk acceptance by the community -- all for the sake of common national interest and vision for the future. Creation of a joint review board working in an advisory capacity might be the answer.

Risk assessments for offshore petroleum installations have for more than 20 years focused on development of new installations or major modifications, using both qualitative and quantitative risk assessments. The risk assessments have often, especially the quantitative studies, placed an emphasis on major hazards. There is now focus on how risk assessments may be used most efficiently for installations in the operational phase. In this paper we review the challenges for use of risk assessment studies for installations in the operational phase, with the main emphasis on quantitative studies. The focus should mainly be on aspects that are available for influence in the operations phase, so-called free variables. When these are of a different nature from those that apply in the development phase, this should have strong impact on the studies being conducted. However, these changes to analytical approach have yet to be fully implemented.