Stork Technical Services

Organisational integrity
Module 2: Risk Management
Chemical

Power

Oil & Gas

Jos Van der Aelst

Principal Consultant Asset Management
Jos.vanderaelst@stork.com
1 Organisational integrity 0032 499 98 61 00
Organisational integrity in oil & gas

2 Organisational integrity
 Module 2

Module 1 Asset Management (AM)

Introduction AM &
Risk Management
Organisational integrity

Module 4
Organisational capabilities
Module 3

AM Policy & AM
AM Processes AM People AM Means
Strategy Organisation

Module 5

Asset Activity Cycle

Design,
Concept & Operate &
purchase & Delivery Dismantling
Business case Maintain
construction

3 Organisational integrity
Module 2: Risk Management
Risk Management introduction
Risk Management as back bone for the set up and decision making
of (Organisational) Integrity
Risk Management methodology
Risk Management: example of lack of organisational integrity

4 Organisational integrity
Module 2: Risk Management
Risk Management introduction
Risk Management as back bone for the set up and decision making
of (Organisational) Integrity
Risk Management methodology
Risk Management: example of lack of organisational integrity

5 Organisational integrity
 Risk Management
Risk management
is the identification, assessment, and prioritisation of risks*,

followed by coordinated and economical application of resources

to minimise, monitor, and control the probability and/or impact of adverse events

or to maximise the realisation of opportunities.

*the effect of uncertainty on objectives, whether positive or negative ISO31000

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 Hazard and Risk (I)
Hazard:
A hazard is something (e.g. an object, a property of a substance, a
phenomenon or an activity) that can cause adverse effects

Examples:
o Chemical hazards; storage of products, reaction,
o Physical hazards; metallurgic defects in pipe line,
o Explosion hazards; treatment of combustibles,
o Environmental hazards; dust, heat, hurricanes,
o Stress hazards; to much pressure on the work, ..
o Procedure/system hazards; incorrect procedure,
o Operational hazards; working in a densely populated area,
o

7 Organisational integrity
 Hazard and Risk (II)
Risk:
A risk is the likelihood that a hazard will actually cause its adverse effects, together
with a measure of the effect
Risk is associated with the probability of a negative or positive outcome of an event or

situation

Risk = Probability * Outcome (consequence)

* Examples of consequences :
Personal harm
Environmental damage
Property damage
Production losses
Image damage
Penalties from the government

8 Organisational integrity
Module 2: Risk Management
Risk Management introduction
Risk Management as back bone for the set up and decision making
of (Organisational) Integrity
Risk Management methodology
Risk Management: example of lack of organisational integrity

9 Organisational integrity
Risk Management as back bone for
organisational integrity
Organisational integrity can be described as knowing what are the
right things to do and doing the right things

Risk Management used for

knowing what are the right things to do
To determine pro-active the measurements to take in order to realise
organisational integrity
doing the right things
Monitoring that the right things are done
Supporting the organizational decision making process
evaluating the effectiveness of knowing what are the right things to do
and doing the right things

10 Organisational integrity
Module 2: Risk Management
Risk Management introduction
Risk Management as back bone for the set up and decision making
of (Organisational) Integrity
Risk Management methodology
Risk Management: example of lack of organisational integrity

11 Organisational integrity
Risk Management
Models

ISO 31000

EFQM
12 Organisational integrity
Risk Recognition: identify risks
Risk register
General risks
Responsibility of the employer versus employees, contractors and third parties (Duty of Care)

Legal conformities with regards to safety, environment, (regulatory compliant) + Company + Branch

standards and rules

Asset required performances (e.g. in relation with customer demands),

Specific causes for hazard realisation related to the management of Assets

Asset and/or control system failure

Human failures

Unexpected release of energy; Mechanical, Chemical reaction hazards and / or unstable conditions,

Influences from other systems and/or external events

Environmental influences (see Fukushima)

In which part(s) of the facilities are the hazards relevant (e.g., pressure vessels, cranes,

storage)

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Organisational integrity
Risk Recognition: identify risks

Several ways to identify risks:

risk checklists
own checklists based on experience or project databases

information from specialists, research, insurance, or management expertise

examining similar current or previous projects/situations,

benchmarks, risk analyses or project evaluations.

brainstorming or work shops

for projects/situations involving new or unusual risks, innovations or to develop initial

checklists.

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Risk identification methods

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Risk Analysis
The identified hazards will be analysed:
Consequence
Likelihood

Approaches
Intuitive
Daily decisions based on our experience
Systematically
Qualitative based judgement (e.g. Risk Matrix)
Structured sessions with multi-discipline experience
Qualitative / Quantitative analyses based (e.g. Bow Tie, Barrier diagrams)
Mix of both
Quantitative analysis based (e.g. Fault tree)
Studies by specialists (complexity and detailed information is required)

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 Risk Analysis High Low High Extr. Extr.

Probability Rating
method Medium Low Med. High Extr.
(Risk Matrix)
Low Negl. Low Med. High

Negligible Negl. Negl. Low Med.

Probability or likelihood of occurrence event Negligible Low Medium High

(e.g. asset failure)

Consequence Rating

Consequence or impact rating (e.g. catastrophe)

Consequences or impact related to the Business values !!!

- Safety, Health & environmental and community
- Financial
- Legal & compliance
- Customer (delivery / quality / satisfaction)
- Reputation
- Investment return,
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Risk Analysis
method
(Bow Tie)

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Risk evaluation
Acceptable Risks Risk Assessment Matrix

High Low High Extr. Extr.

Probability Rating
Medium Low Med. High Extr.

Low Negl. Low Med. High

Negligible Negl. Negl. Low Med.

Negligible Low Medium High

Consequence Rating
For a Risk Matrix:
Acceptable Every risk with a low or negligible severity. Existing risk measures need
to be maintained and managed.
Medium Can be acceptable regarding the circumstances (ALARP). Risk-reducing
measures have to be implemented and maintained.
High not acceptable and risk-reducing measures should be installed.
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Acceptable Risk (ALARP)

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Managing risks;
decision - implementation

Implement countermeasures in order to bring unacceptable risks to

acceptable level
4 Ts

risk prevention
impact mitigation
risk acceptance
risk transfer

21 Organisational integrity select the best response

Managing risks;
decision - implementation

Decision making and prioritisation

You may, however, not have the resources to accomplish it

We must therefore prioritise our corrective actions by addressing

high risks before low risks

22 Organisational integrity
Module 2: Risk Management
Risk Management introduction
Risk Management as back bone for the set up and decision making
of (Organisational) Integrity
Risk Management methodology
Risk Management: example of lack of organisational integrity

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 Safety Incident - Failure of prevention and
mitigation measures
Swiss cheese model - deviations occur from the intended approach*
Metrics measure effectiveness of safety management implementation
Check barriers integrity

*Weaknesses or Holes in the

system of Barriers and Corrective
Actions
Hazard

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Organisational integrityintegrity
 Example: tank storage & handling

Policy: compliance liabilities ( environment

safety health : Seveso API650 EMUA 159- )
and internal liabilities
Strategy: sustainable growth

Hazard

25 Organisational
Organisational integrityintegrity
 Example: tank storage & handling

Procedures: Engineering (HAZOP/ SIL / ATEX / FMEA / )

Maintenance Plans: yearly check of safety critical
measurements (internal), and 3 yearly Tank control (external),
MOC, RBI
Operation: inspection tour, cleaning program,

Hazard

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Organisational integrityintegrity
 Example: tank storage & handling

Organisation; clear structure

Responsibilities and authorities
Organisation is staffed accordingly with the work load
Organisation: third parties are integrated in integrity
management

Hazard

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Organisational integrityintegrity
 Example: tank storage & handling

Staff has the competencies / skills

Education/training on storage tank rules
Leadership are committed and accountable
for integrity

Hazard

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Organisational integrityintegrity
 Example: tank storage & handling

Supportive tools are in perfect conditions

Personal protective equipment is available

Hazard

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Organisational integrityintegrity
 Example: tank storage & handling

Internal disasterplan & calamity procedures

Training for emergency plans
External disaster plan: roles, flow, actions

Hazard

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Organisational integrityintegrity
 Example: tank storage & handling: Major spill
Levelswitch not working
Levelswitch not identified as critical measurement (seveso)
Not standard levelswitch (engineering)/not in stock
No effective management of change process
Operator had not the knowledge to install other switch
Intranet didnt work no one aware of this intervention
Tank overfill
Hazard

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Organisational integrityintegrity
 Want to learn more?

Explore the detail behind these

essentials
Discover how they fit into a
wider integrity strategy
Walk through real life case
studies which bring them to life
All without leaving your desk
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