Pipelines and Risk ManagementPipelines and Risk ManagementHow Safe is Safe?How Safe is Safe?

Pipeline Safety Trust ConferencePipeline Safety Trust Conference

Denise HamsherDenise HamsherEnbridge Energy CompanyEnbridge Energy Company

November 2006November 2006

Over 14,000 miles Over 14,000 miles of natural gas of natural gas gathering, gathering, transmission and transmission and crude oil pipelinescrude oil pipelines

Operating since Operating since 19501950

Expanding pipeline Expanding pipeline systems to meet systems to meet market transport market transport needsneeds

How Safe is Safe?How Safe is Safe?

Can we eliminate risk?Can we eliminate risk? Or is question: “What is acceptable risk?”Or is question: “What is acceptable risk?”

• Scientific and technical answer?Scientific and technical answer?• Government policy?Government policy?• Regulatory decision?Regulatory decision?• Community concern?Community concern?

There may be no There may be no singlesingle answer to answer to question of “How Safe is Safe?”question of “How Safe is Safe?”• But there But there areare approaches to improve approaches to improve

understanding and communicate riskunderstanding and communicate risk

Technical Scientific AnswerTechnical Scientific Answer Risk = Probability X ConsequenceRisk = Probability X Consequence Probability:Probability:

• “… “… a revised USGS report concluded that a 33 percent a revised USGS report concluded that a 33 percent probability now exists for one or more large earthquakes probability now exists for one or more large earthquakes in the San Francisco Bay Area region between 1990 and in the San Francisco Bay Area region between 1990 and 2000..”2000..”

• Based on fact-finding and dataBased on fact-finding and data But whose facts? But whose facts?

Consequence:Consequence:• Safety of public and workersSafety of public and workers• Environmental impactEnvironmental impact• Upsets and reliability in serviceUpsets and reliability in service• Costs and liabilityCosts and liability

RiskRisk

As seen by engineer & regulator:As seen by engineer & regulator:

Risk = probability x Risk = probability x consequenceconsequence

As seen by others:As seen by others:

Risk = hazard* x concern**Risk = hazard* x concern*** Hazard may be actual or perceived

** Concern may be over safety, environment, fairness, property value, lack of information, lack of trust

Why we haveWhy we havedifferent perceptions of riskdifferent perceptions of risk

FamiliarFamiliar versus versus UnknownUnknown

Benefit Benefit versus versus BurdenBurden

FairFair versus versus UnfairUnfair

ControlledControlled versus versus Out of my Out of my controlcontrol

TrustedTrusted sourcesource versus versus Suspicious Suspicious sourcesource

Government Regulatory Answer:Government Regulatory Answer:

Public Health and OSHA standards on Public Health and OSHA standards on acute or long-term exposure limits to acute or long-term exposure limits to certain chemicalscertain chemicals

Prescribed frequency of inspections or Prescribed frequency of inspections or maintenance of pipelinesmaintenance of pipelines

Gas operations “class locations” and designation of liquid pipeline HCAs, each requiring special safety measures

All true….all based on fact…but does policy make everyone feel “safe”?

Community PerspectiveCommunity Perspective

Public definition of risk = Public definition of risk = Risk = Hazard X ConcernRisk = Hazard X Concern

We all expect “zero risk” for We all expect “zero risk” for ourselves and loved onesourselves and loved ones

Sometimes hazard is high and Sometimes hazard is high and concern low … and sometimes concern low … and sometimes concern is high and scientific facts concern is high and scientific facts indicate a low riskindicate a low risk

So how do we manage the So how do we manage the

interface among technical interface among technical

assessments, government assessments, government

policy and public concern?policy and public concern?

Approaches that helpApproaches that help

Accept responsibilityAccept responsibility Encourage fact finding and sharingEncourage fact finding and sharing Reduce and mitigate risksReduce and mitigate risks

• Basis of regulatory and consensus standardsBasis of regulatory and consensus standards All parties act with respect and be All parties act with respect and be

trustworthytrustworthy• Principled leadershipPrincipled leadership

Acknowledge risk issue-management is Acknowledge risk issue-management is function of investment in communications function of investment in communications and involvementand involvement

Example: Regulatory Policies for Example: Regulatory Policies for Pipeline OperationsPipeline Operations

Public InvolvementPublic Involvement Fact finding and research rather than Fact finding and research rather than

reactive to unusual, rare eventreactive to unusual, rare event Flexibility to ensure effective Flexibility to ensure effective

practicespractices Education, awareness, dialogueEducation, awareness, dialogue

Example: Planning a New PipelineExample: Planning a New Pipeline

Early planning and dialogue with community • County• Farm Bureaus• Landowners, etc.

Fact finding• Route alternative considerations• Review route with landowner, adjusting as possible

Trustworthy dialogue• Knowledgeable, trained company representatives • Commitment by all to reach solutions

Two-way public consultation requires investment

Planning New Pipeline (cont’d)Planning New Pipeline (cont’d) Mitigate RisksMitigate Risks

• Design and routing carefully plannedDesign and routing carefully planned• Special construction practicesSpecial construction practices

o Protect farmlands with special soil handling Protect farmlands with special soil handling techniquestechniques

o Special river crossing techniques. . .etc.Special river crossing techniques. . .etc.• Additional safeguards near some areas may require Additional safeguards near some areas may require

consideration of:consideration of:o Thicker wall pipe under riversThicker wall pipe under riverso Supplemental patrols or inspectionsSupplemental patrols or inspectionso Warning tape to warn excavatorsWarning tape to warn excavatorso Route deviationsRoute deviations

How Safe is Safe?How Safe is Safe?A few observations…..A few observations…..

Risk and safety is all in the eye of beholderRisk and safety is all in the eye of beholder• We all We all knowknow there is no such thing as zero there is no such thing as zero

risk, but we risk, but we wantwant assurances we are safe assurances we are safe

Risk communications must be interactiveRisk communications must be interactive

Each party should commit to:Each party should commit to:• Increasing knowledge and understandingIncreasing knowledge and understanding• Enhancing trust and credibilityEnhancing trust and credibility• Resolving conflictResolving conflict