Risk ManagementIntroduction
Course Pre-requisite
Engineering System
Risk
2
Engineering Statistics
System Reliability
Engineering
Risk Management
Course Topics
Introduction
Risk Assessment Concepts
Risk Assessment Methodology
Hazard Identification
Frequency Modeling Frequency Modeling
Consequence Modeling
Risk Acceptance
Risk Mitigation
Risk Management
Case Studies
3
Course Materials/References
1. Textbook Penilaian Risiko Pipa Gas Bawah Laut
2. Standards, particularly:
1. DNV-RP-F107 (Risk Assessment of Pipeline Protection)
2. DNV-OS-F101 (Submarine Pipeline Design and
Construction)
API 581 (Risk Based Inspection)3. API 581 (Risk Based Inspection)
4. ASME B 38.1 (Gas Transmission & Distribution Piping
Systems)
5. ABS guidelines in risk assessment
3. Related Papers and Journals
4. Course Handouts
4
References
5
Course methods
Lectures
Group discussions and presentations
Paper-based examination
Homework and case study Homework and case study
6
Course evaluation
Final examination : 30%
Midterm examination : 30%
Assignment 1/Quiz1 : 20%
Assignment 2/Quiz 2 :20%
Weekly attendance : 0%Weekly attendance : 0%
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8
Risk is a curious and complex concept. In a sense it is
unreal in that it is always concerned with future, with
possibilities, with what has not yet happenedpossibilities, with what has not yet happened
Elms (1992)
9
Definitions
Risk
A measure of the potential for loss in terms of both the
likelihood (events/year) of the incident and the
consequences (effects/event) of the incident
Risk Analysis
Systematic use of available information to identify hazards
and to estimate the risk to individuals, property, and the
environment (IEC 60300-3-9,1995)
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A risk analysis is always a proactive approach in the sense that it
deals exclusively with potential accidents. This is opposed to
accident investigation, which is a reactive approach that seeks
to determine the causes and circumstances of accidents that
have already happened.
Risk analysis three main questions
A risk analysis is carried out to provide answers to
the following three main questions (Kaplan and
Garrick, 1981 ):
Q 1. What can go wrong?
To answer this question, we must identify the To answer this question, we must identify the
possible hazardous events that may lead to harm to
some assets that we want to keep and protect.
These assets may be people, animals, the
environment, buildings, technical installations,
infrastructure, cultural heritage, our reputation,
information, data, and many more.
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Risk analysis three main questions
Q2. What is the likelihood of that happening!
The answer can be given as a qualitative statement or as
probabilities or frequencies. We consider the hazardous events
that were identified in Q 1, one by one.
To determine their likelihood, we often have to carry out a
causal analysis to identify the basic causes (hazards or threats) causal analysis to identify the basic causes (hazards or threats)
that may lead to the hazardous event.
Q3. What are the consequences?
For each hazardous event, we must identify the potential harm
or adverse consequences to the assets mentioned in Q I.
Most systems have barriers that are installed to prevent or
mitigate harm. The harm to the assets is dependent on
whether or not these barriers function when the hazardous
event takes place.12
Risk analysis three main steps
Hazard identification. In this step, the hazards and threats related to the system are identified together with the potential hazardous events. As part of this process, assets that may be harmed are also identified.
Frequency analysis. This step will usually involve a deductive analysis to identify the causes of each hazardous event and to estimate the frequency of the hazardous event and to estimate the frequency of the hazardous event based on experience data and/or expert judgments.
Consequence analysis. Here, an inductive analysis is carried out to identify all potential sequences of events that can emerge from the hazardous event. The objective of the inductive analysis is usually to identify all potential end consequences and also their probability of occurrence.
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Qualitative Quantitative risk analysis
Qualitative risk analysis: A risk analysis where probabilities and consequences are determined purely qualitatively.
Quantitative risk analysis (QRA): A risk analysis that provides numerical estimates for probabilities and/or consequences-sometimes along with associated uncertainties.uncertainties.
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Definitions
Risk Evaluation
Process in which judgments are made on the
tolerability of the risk on the basis of a risk
analysis and taking into account factors such as
socioeconomic and environmental aspects (IEC socioeconomic and environmental aspects (IEC
60300-3-9, 1995).
Risk assessment
Overall process of risk analysis and risk evaluation
(IEC 60300-3-9, 1995).
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DefinitionsRisk Management
A continuous management process with the objective to identify, analyze, and assess potential hazards in a system or related to an activity, and to identify and introduce risk control measures to eliminate or reduce potential harms to people, the environment, or other assets.
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Risk analysis, assessment, management processes
Risk
Analysis
Risk
Assessment
17
Risk
Management
Risk representation
< 10-6
10-4 - 10
-610
-2 - 10
-410
-1 - 10
-2>10
-1
Could occur but
very doubtful
(almost impossible)
Could occur but
doubtful
Might occur at
some time in the
future
Will probably occur Is expected to occur
in most circum-stances
Has occurred in
E&P industry
Has never occurred
in VICO
Has occurred in
VICO
Has Occurred several
times in VICO
Happens several times
per year in a location
People/Health Production/Assets Environment Reputation E D C B A
Very short term health
effect/injury
(First Aid case)
Minor or negligible
disruption, easily
recovered or
replaced or
< $10 K
Any spill inside secondary containment
Uncontained oil or chemical spill 1 MMSCF, or
> 100 BBLS, or
> $10 K
Uncontained oil or chemical spill (10L
- 1bbl) retained on VICO property
Requires liquid oil recovery efforts
(absorbent)
Exposure in Badak area
LMI4 23 21 18 14 10
18
(absorbent)
Remediation/clean-up cost 10 MMSCF, or
> 1000 BBLS, or
> $100 K
Uncontained oil or chemical spill (1bbl -
15bbls) retained on VICO property
Uncontained spill outside boundary with
minor off-site impact
Remediation/clean-up cost $10K
$100K.
Regional newspaper
exposure (KALTIM)
IIT
Public claim for damage3 20 17 13 9 6
Permanent debilitating injury o>100 MMSCF, or
> 10,000 BBLS, or
> $1 MM
Any oil or chemical spill 15bbls 50 bbls
Any spill on water, clean up only using
internal resources
Remediation/clean-up cost > $100 K.
Requires immediate statutory reporting*
Oversight from environmental authority
National newspaper
exposure
BOI
Legal class action
from NGO/community
2 16 12 8 5 3
Fatality >1000 MMSCF
>100,000 BBLS
> $10 MM
Any oil or chemical spill > 50 bbls
Any spill, clean up requiring assistance
outside VICO
Remediation/clean-up cost
> $1 MM
Community evacuation.
Environmental law violations
International Exposure
Other significant
community impact.
Government/ criminal
investigation
1 11 X 4 2 1
Risk representationRisk Matrix According to DNV-RP-F107
1 2 3 4 5
VERY LOW LOW MODERATE HIGH MAJOR
5
FR
EQ
UE
NT
4
PR
OB
AB
LE
3
OC
CA
SIO
NA
L
CONSEQUENCE RANKING
FR
EQ
UE
NC
Y R
AN
KIN
G
Frequency Ranking According to DNV-RP-F107
Consequence Ranking According to DNV-RP-F107
19
3
OC
CA
SIO
NA
L
2
RE
MO
TE
1
IMP
RO
BA
BL
E
FR
EQ
UE
NC
Y R
AN
KIN
G
Not Acceptable
ALARP Region
Acceptable
D
Denting/Diameter
20