Dirk-Jan Schuld - Lloyds Register

The role of independent inspection companies providing industrial safety

Subtitle:

Achieving Safety through risk based

Asset Performance Management

to

Seminar on Safe Consumer Products & Industrial Installations

1st CEOC International Safety Conference

D.J. Schuld

Lloyd’s Register EnergyRBMI manager Operations Europe, Middle-

East & Africa

Achieving Safety through risk based asset performance managementD.J. Schuld – RBMI Manager Operations EMEA

The Lloyd’s Register Group today

Values• We are a non-profit distributing

organisation; impartial with complete financial, political and technical independence

• Origins dating back to 1760

• Our offer is distinct, transparent and results orientated

• We have 7,000 dedicated and highly competent employees worldwide, drawn from over 90 nationalities

• 240 offices

• > 100 countries recognisedtrustedun-biased


The Lloyd’s Register Group today

A leading international authority

• Our mission is to help you achieve high technical standards for enhancing the safety of life and property

• Our services focus on compliance, safety, integrity and risk management –we advise on ‘best practice’ for the design, management and operation of assets and systems over the life cycle

• We support clients in meeting their legislative and corporate responsibilities

safetyintegrityperformancelife matters


The markets we serve

• The principal markets in which the group is active are Energy and Transportation (including Marine)

• These are markets characterised by high risk capital intensive assetswhere independent assurance is valued

• These services can be offered both from an independent perspective as well from a consultancy perspective


• The world today; our customers• The question of today• Integrity

• Asset• System / Process• Organisational

• Linkage with Rimap• The ingredients for success

• Questions and Answers

Discussion focus

safetyintegrityperformancelife matters


The world today; What is the situation to our customers…..?

Turbulent times…….!


NY – SP – 500 / 5YTD

AEX / 5YTD

NY- Nasdaq - 100 / 5YTD

China-Shangai - B/ 5YTD


Why are Risks Increasing in the Energy Sector?

• Aging Infrastructure• Loss of Experience• Technical standards and procedures are missing or inappropriate• Lack of Competency• Shifts in Expectations of Employees• Lack of Management Control / Accountability

This all enhanced by the financial crunch……


Operating Companies in High Risk Business Sectors

• Under increasing market pressure OPCO’s are obliged • to improve business performance

• while becoming more socially responsible (SAFETY ↑ ???)

• These requirements are in conflict at times

• Failure of a critical asset in a high risk business sectors normally has a significant impact on the safety, health, environment or the reputation and profitability of the business

• Short term focus on reducing asset management costs will often result in higher risk and long term loss of value to the organization


The question of today; are we

achieving Safety through risk based Asset Performance Management

Or

achieving Value through risk based Asset Performance Management


Asset Performance overtime

Time

Perf

orm

ance

Sustained Asset

Performance

Complacency

Changes in process

Turnover of Skilled Staff

Aging Equipment

Asset PerformanceImprovement“system Fixes”

Risk Based APMDeep Learning

“cultural changes”

Asset Performance Improvement

“Hardware Fixes”

Natural tendency for performance to deteriorate


Lloyd’s Registers believe: Assets are socio technical systems

The Sociotechnical ApproachA system comprises assets, processes and people, and the

interactions between these three components.

The interactions between:

• People and assets, • People and processes & systems, and• People and people (plant)

Are crucial to the success of the asset.


Weak total Integrity management multiplies risk

• Between 70% and 90% of failures are attributable to human and organisational failure (driven by organisational drift)

Human & Organisational

failures

Technical failures

Technical failures

SystemProcessfailures


Organisational drift - consequences

• Technical standards and procedures are missing or inappropriate

• Competence and understanding are insufficient

• Commitment to technical integrity is lost

• Safety management processes degrade

• Inability to detect and recognise symptoms of potential failure.


Integrity management

Integrity = adherence to moral and ethical principles or firm adherence to a code

• Asset Integrity

• System / Process Integrity

• Organisational Integrity


Lloyd’s Register focus on APM / Integrity – control of risk

To start with:

• Asset integrity

• System / Process integrity

• Operational (human) Integrity


Organisational Integrity

• Integrity = adherence to moral and ethical principles or firm adherence to a code

• Organisational = the simultaneous processes of change undergone by organisations or organisational networks, and by the individuals working in them within the framework of technical cooperation projects

• Organisational integrity = the ability of a corporation to handle changes and transformations that is held in a firm adherence to mission, vision and basic corporation values


The focus on asset integrity -> asset life cycle could be the foundation on which to build Risk based APM

Performance

Integrity

LifeLife--extension / extension / ReRe--use / use / DeDe--commissioningcommissioning

SafetyMaintenance

& InspectionsManagement

Maintenance &Inspection Plan

Development

OperationsManagement

Spare PartsManagement

ComplianceManagement

Shut-down &Project Management

Design

Construction

Commissioning


The focus on asset integrity

PerformanceLifeLife--extension / extension / ReRe--use / use / DeDe--commissioningcommissioning

Maintenance& InspectionsManagement

Maintenance &Inspection Plan

Development

OperationsManagement

Spare PartsManagement

ComplianceManagement

Shut-down &Project Management

Design

Construction

Commissioning

Integrity

Safety



Performance

Integrity

Safety


Operational

Tactical

Strategic


• Policy • Strategy • Governance

• HRM / HSE / QMS• Operational Excellence

• Risk Based APM

• Asset Management Best Practices


Risk Distribution

20 1 10 5 5 0 0246 2 72 81 74 18 1235 3 71 77 74 12 1238 4 76 71 71 17 3232 5 88 35 36 65 8

E D C B A971 317 269 260 112 13

RBI / Rimap: As found Risk Distribution

Risk based TECHNOLOGYDelivering the APM risk models

Instruments &Valves

Instruments &Valves

Control systems and Electrical EquipmentControl systems and Electrical Equipment

Mechanical EquipmentMechanical EquipmentProcess Equipment

Process Equipment

Piping and pipelines

Drilling systemsDrilling systems

Fixed EquipmentFixed Equipment

FPSO


The ingredients for a safety culture……

+ = Enhanced / risk based

AssetPerformance


Asset integrity

Asset integrity

SystemProcessIntegrity


The linkage….is Rimap securing safety, integrity and adding value to our customers?

RIMAP: Risk-Based Inspection and Maintenance Procedures for European industries

• Developed according to the European R&D project RIMAP (from 2001 u/t 2005)

• Validation process in place • RIMAP principles published as CEN Workshop Agreement CWA

15740: 2008


Scope of RIMAP

Essential scope of the RIMAP project GIRD-CT-2001-03008 and CWA 15740:

To contribute for harmonization of European national regulations regarding to:

• Improvement of performance with respect to safety, health and environment

• Risk based Inspection- and maintenance programs for the European industries

• Improvement of cost efficiency with respect to inspection and maintenance


Rimap vs Lloyd’s Register perspective on Risk based APM

Asset IntegrityCompatible with most other risk-based approaches (API 580/581, ASME CRTD), but while principles are largely similar, the results will not be identical

6

Organisational / system Integrity

RIMAP within an overall management system5

Asset / system Integrity

General requirements on CoF analyses 4

Asset / system Integrity

General requirements on PoF analyses 3


Personnel requirements2

Asset IntegrityGeneral requirements (used methodology etc.)1

LevelLRs viewRIMAP


How important is it to an accredited Independent Inspection body to collaborate with an certified Operating Company?

Inspectionmethodology /WSE per asset

Certified Inspection

DepartmentOPCO

Approved RBI methodologyApproved RBI methodology

If applicable:AccreditedInspection

Body


+ =Organisational Integrity

RBIRBI

accredited / certified systems

Lloyd’s Register Conclusion: Rimap contributes to a safety culture in a controlled manner


Examples within Europe

• A Risk-Based approach, using API 580• Belgium, Italy (restricting on maximum interval)

• A Time-Based approach, based on time based strategy rules• Germany, WSE in UK

• Factored Remaining Life (adjustment of the correction factor regarding ‘half remaining life’)

• The Netherlands, France


RBI and local legislation within Europe


Enhanced Risk based APM Maturity

Rea

ctiv

e

Man

aged

Pro

acti

ve

Op

tim

isin

g

Frag

ile/F

atig

ued

Improving Risk Based APMSAFE

TY C

ult

ure

= Im

pro

vin

g P

erfo

rman

ce


Summary

SAFETYSAFETY

PERFORMANCEPERFORMANCE

VALUEVALUE

Certified Inspection

DepartmentOPCO

AccreditedInspection

Body


Body


Body


Global reach

Head office:London

Regions:EMEA, Americas, Asia

Local company officesA global network of offices covering > 100 countries

Client profileAsset owners, manufacturers, operators, fabricators, regulators and legislativeauthorities, government and engineering procurement construction contractors


•Asset Performance Management •Risk Based Asset Management Software and Development•Change Management Consulting•Domain (Energy) Expertise

•Management Systems Knowledge•Human Factors Capability•Maintenance Management

•Management Consulting•Strategic Communications

Broad Capability

Services are provided by members of the Lloyd’s Register Group.

Registered office: 71 Fenchurch Street, London, EC3M 4BS, UK. Registered No. 3073293


Lloyd’s Register Energy

Dirk-Jan SchuldRBMI Manager Operations EMEA

T +31 6 21 835 336

[email protected]

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Dirk-Jan Schuld - Lloyds Register