INTRODUCTION TO THE PIPELINE RISK MANAGEMENTS.A.I. CompanyPejman Malekinejad

Beginning Risk ManagementStep 1: Acquire a risk assessment modelA pipeline risk assessment model is a set of algorithms or rules that use available information and data relationships to measure levels of risk along a pipeline. A risk assessment model can be selected from some commercially available models, customized from existing models, or created from scratch depending on requirements.Step 2: Collect and prepare dataData preparation are the processes that result in data sets that are ready to be read into and used by the risk assessment model.Step 3: Devise and implement a segmentation strategyBecause risks are rarely constant along a pipeline, it is advantageous to first segment the line into sections with constant risk characteristics (dynamic segmentation) or otherwise divide the pipeline into manageable pieces.Step 4:Assess the risksAfter a risk model has been selected and the data have been prepared, risks along the pipeline route can be assessed. This is the process of applying the algorithn-the rules-to the collected data. Each pipeline segment will get a unique risk score that reflects its current condition, environment, and the operating/maintenance activities. These relative risk numbers can later be converted into absolute risk numbers. Risk assessment will need to be repeated periodically to capture changing conditions.

Beginning Risk ManagementStep 5: Manage the risksThis step consists of determining what actions are appropriate given the risk assessment results. This is discussed in Chapter 15. Model design and data collection are often the most costly parts of the process. These steps can be time consuming not only in the hands-on aspects, but also in obtaining the necessary consensus from all key players. The initial consensus oftenmakes the difference between a widely accepted and a partially resisted system. Time and resources spent in these steps can be viewed as initial investments in a successfil risk management tool. Program management and maintenance are normally small relative to initial setup costs.

The Pipeline Risk Management Demonstration Project

Third-partyDamageCorrosionDesignIncorrect OperationsIndex SumLeak Impact FactorRelative Risk ScoreRelative Risk Rating = (Index Sum) +(Leak Impact Factor)Index Sum = [(Third Party) +(Corrosion) +(Design)+(Incorrect Operations)]Third-party IndexA. Minimum Depth of Cover. ...... 0-20 pts-----20%B. Activity Level. ......................... 0-20 pts-----20%C. Aboveground Facilities ........... 0-10 pts-----10%D. LineLocating .......................... 0-15 pts------15%E. Public Education .....................0-15 pts-------15%F. Right-of-way Condition. . . . . . .0-5 pts-------5%G. Patrol.. ................................. . 0-15 pts-------15%

Risk Assessment ModelsWhat is a model?Armed with an understanding of the scenarios that compose the hazard , a risk assessment model can be constructed. The model is the set of rules by which we will predict the future performance of the pipeline from a risk perspective. The model will be the constructors representation of risk. The goal of any risk assessment model is to quantify the risks, in either a relative or absolute sense. The risk assessmentphase is the critical first step in practicing risk management. It is also the most difficult phase. Although we understand engineering concepts about corrosion and fluids flow, predicting failures beyond the laboratory in a complex real environmentcan prove impossible. No one can definitively state where or when an accidental pipeline failure will occur. However, the more likely failure mechanisms, locations, and frequencies can be estimated in order to focus risk efforts.

Matrix modelsOne of the simplest risk assessment structures is a decisionanalysis matrix. It ranks pipeline risks according to the likelihood and the potential consequences of an event by a simplescale, such as high, medium, or low, or a numerical scale; from 1 to 5, for example. Each threat is assigned to a cell of the matrix based on its perceived likelihood and perceived consequence.Events with both a high likelihood and a high consequence appear higher on the resulting prioritized list. This approach may simply use expert opinion or a more complicated applicationmight use quantitative information to rank risks. Figure below shows a matrix model. While this approach cannot consider all pertinent factors and their relationships, it does help to crystallizethinking by at least breaking the problem into two parts (probability and consequence) for separate examination.Risk Assessment Models

Probabilistic modelsThe most rigorous and complex risk assessment model is a modeling approach commonly referred to as probabilistic risk assessment (PRA) and sometimes also called quantitativerisk assessment (QRA) or numerical risk assessment (NRA). Note that these terms carry implications that are not necessarily appropriate as discussed elsewhere. This technique is used inthe nuclear, chemical, and aerospace industries and, to some extent, in the petrochemical industry.Risk Assessment ModelsIndexing modelsPerhaps the most popular pipeline risk assessment technique in current use is the index model or some similar scoring technique. In this approach, numerical values (scores) are assigned to important conditions and activities on the pipeline system that contribute to the risk picture. This includes both riskreducing and risk-increasing items, or variables. Weightings are assigned to each risk variable. The relative weight reflects the importance of the item in the risk assessment and is based on statistics where available and on engineering judgment where data are not available. Each pipeline section is scored based on all of its attributes. The various pipe segments may then be ranked according to their relative risk scores in order to prioritize repairs, inspections, and other risk mitigating efforts.Among pipeline operators today, this technique is widely used and ranges from a simple one- or two-factor model (where only factors such as leak history and population density are considered) to models with hundreds of factors considering virtually every item that impacts risk.

The Pipeline Risk Management Demonstration Project

Risk Management Program Standard

Demonstration Project Performance Measures

OPS Review and Approval ProcessNEXT SLIDE

Risk Management Demonstrations Program Standard is Used by Industry as Guideline for Development and Submittal of Proposed Risk Management Programs

Review Protocols and Criteria based on the Program Standard are Used by OPS to Review, Approve, and Monitor Proposed Industry Programs

Performance Measures are Used by both OPS and Industry to Evaluate the Success of the Risk Management Demonstration Project The Pipeline Risk Management Demonstration ProjectPREVIOUS SLIDE

Program ElementsProcess Elements

AdministrationRoles & Responsibilities

PersonnelQualifications

Management of Change

Communications

Documentation

Program Evaluation and Improvement

Risk AssessmentWhat is the Scope of the Risk Assessment?What Adverse Events Can Happen?How Likely are These Events to Occur?How Severe Would the Consequences Be if the Events Did Occur?

Risk Control & Decision SupportWhat Could Be Done to Control Risks?What Are the Relative Merits of the Risk Control Options?What Set of Activities Best Achieves Risk Management Goals?

Feedback LoopsPerformance Monitoring & FeedbackWhat Improvements are Expected to Result from the Risk Control Decisions?What Measures Best Capture These Expected Outcomes?Are the Selected Risk Control Activities Having the Intended Effect?How Can the Overall Risk Management Process be Improved?

Progression of a Pipeline IncidentHazardCauseAccidentalEventImpactHazardous liquid or gas contained and delivered during normal operationPrecursor, initiating or contributing events of a pipeline incident; start of the accident event sequence (e.g., coating disbond, mechanical damage)Loss of containment of hazardous liquid or gas; product migrates along available pathways to people, environmental resources, etc.Adverse consequences to people, the environment, etc.

Risk Control Activities During Progression of a Pipeline IncidentHazardCauseAccidentalEventImpactExample Types of Risk Control ActivitiesPrevention- Corrosion Control- Maintenance Programs- Impact Barriers

Mitigation- Isolation Valves- Dike / trench- Sprinkler / delugeResponse-Evacuation- Spill response- Flowpath diversion

Performance Measures Associated with Stages of a Pipeline IncidentHazardCauseAccidentalEventImpactExample Performance MeasuresPreventionHydrotest Results

MitigationReliability of Isolation ValvesResponseEffectiveness of Emergency Drills

The Risk Assessment Process ElementScoping and Screening AnalysisDefine the physical and analytical boundaries of the assessmentEvent IdentificationIdentify the events that could cause pipeline failures and lead to adverse consequencesFrequency AnalysisEstimate how often the events might occurConsequence AnalysisEstimate the severity of the adverse impacts should the events occurRisk AssessmentEstimate the frequency and consequences of potential incidentsRisk Control & Decision SupportSelect activities to reduce risk or produce equal or greater levels of safety more efficientlyPerformance Monitoring & FeedbackDetermine if the risk control decisions produce the anticipated outcomesRisk EstimationCombine frequency and consequence estimates into relative risk values

The Risk Control & Decision-Support Process ElementIdentification of Risk Control IssuesDefine the major contributors to risk and opportunities for more efficient control of risksIdentification of Risk Control OptionsDefine specific alternatives to current design and operation that reduce risk or increase efficiencyEvaluation & Comparison of OptionsSelect the best set of design and operational practices that produce equal or greater safetyRisk AssessmentEstimate the frequency and consequences of potential incidentsPerformance Monitoring & FeedbackDetermine if the risk control decisions produce the anticipated outcomesRisk Control & Decision SupportSelect activities to reduce risk or produce equal or greater levels of safety more efficiently

The Performance Monitoring & Feedback Process ElementSelection of Performance MeasuresIdentify expected outcomes of risk control decisions and associated metricsMonitoring & Evaluation of PerformanceTrack actual performance and compare with expectationsModifications to the ProgramAnalyze implications of observed performance to the models, data, assumptions, and conclusions of the risk management programRisk AssessmentEstimate the frequency and consequences of potential incidentsRisk Control & Decision SupportSelect activities to reduce risk or produce equal or greater levels of safety more efficientlyPerformance Monitoring & FeedbackDetermine if the risk control decisions produce the anticipated outcomes

A Good Guide for Further Study

BEST REGARDS FOR YOUR ATTENTION