Lessons Learned from the Application of Risk Management in the Shipment of LNG

1
Lessons Learned from the Application of Risk
Management in the Shipment of LNG

• Ben Poblete
• HSE Manager Senior Risk Management Specialist
• LRNA - Houston
• PREPARED FOR
• 21th Annual CCPS International Conference
• Orlando, FL
• 23 27 April 2006

2
Outline of Presentation

• Introduction / History of LNG shipping
• Regulatory Regime
• Overview of Risks of LNG Shipping
• Current LNG Risk Management Practice
• Assessment of the Impact
• Understanding Reality / Communications

3
Introduction / History

• 30 yrs experience with LNG marine transport
• Physical properties and behavior of LNG remains
  constant
• Significant research work on LNG spills on water
  and land by some of the major producers
• No historic major failures in the shipping of LNG
• Results of research work has been incorporated
  into industry guidance notes.

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Introduction / History

• Ship considered as the containment system
• System contains the cargo and provides protection
  to the ship hull from the extremely cold
  temperatures of the cryogenic cargo.
• Membrane type LNG tanker does not restrict the
  view from the bridge.
• Independent tank is self-supporting

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Introduction / History
Membrane
Primary Insulation
Primary Barrier Membrane
Secondary Insulation
Secondary Barrier
6
Introduction / History
Spherical Type B
Tank Dome
Insulation
Pipe Tower
Skirt
7
Introduction / History
Prismatic Type B
Insulation
Aluminum
Cargo Tank
Chocks
8
Regulatory Regime

• IMO (IGC) / SOLAS / ISPS / SIGTTO / Local rules
  and regulations have provided guidance during
  design and operations
• Hazard and Risk Management work has been focused
  on design accidental events hazards have been
  managed by industry
• Consistency in the management of the LNG hazards
  for all operator
• Security and Vulnerability scenarios are newest
  addition

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Authorities Domain
Engineering Domain
Hazard Identification?
Declaration of Goals and Objectives?
Hazard Assessment?
Hazard Evaluation?
Formulation of Acceptance Criteria?
Hazard Treatment Prescriptive Requirements?
Hazard Treatment Prescriptive Solution
Approval
Monitoring
Conventional Hazard Management Process
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Authorities Domain
Engineering Domain
Declaration of Goals and Objectives?
Hazard Identification?
Hazard Assessment?
Risk Evaluation?
Formulation of Acceptance Criteria (Life Safety
Third Party)
Risk Treatment Performance Based Options
Approval
Risk Treatment Performance Based Solution
Monitoring
Performance Based Hazard Management Process
PERFORMANCE BASED HAZARD MANAGEMENT PROCESS
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Overview of Risks of LNG Shipping

• Incident Scenario dealing with grounding,
  collision and fire
• Focused on spills on water during
  grounding/collision, leaks during transfer
  operations and fire and explosion on ship or at
  the port
• Newest scenario after 9/11 is terrorism and
  sabotage. Scenario development and credibility
  approach. Security concerns now have to be
  addressed as part of the risk management picture
• Using risk management strategy to address
  identified undesirable events.

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Current LNG Risk Management Practice

• Formal risk management technique in the
  identification and management of health, safety,
  environmental and security concerns.
• Risk management process is supported by the ISM,
  ISPS and federal/country codes governing LNG
  shipping throughout the world
• The success of this risk assessment process is
  the correct identification of the undesirable
  events
• The difficulty with the currently adopted risk
  management process is the development of
  acceptable criteria that satisfies both the
  public perception and regulatory body needs
  these criteria will be the measurement of
  satisfaction from the public

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Reasons for Risk Management Option

• Industry trends to Risk-based design
• Industry trends to Risk-based management of
  integrity in service
• Enables approval of novel arrangements
• Effort focused proportionately on critical areas
• Better fit with requirements of Safety Case /
  Formal Safety Assessment
• Resolves conflicts between marine practice and
  petrochemical codes
• Perceived Industry preference

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Elements of Risk Management

• Identify
• Assess
• Define means to reduce risk
• Establish priorities
• Allocate resources
• Communicate
• Monitor

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Assessment of the Impact

• No significant loss of LNG tank cargo during
  80,000 loaded transits since 1950s
• Understanding of chemical and physical properties
  of LNG
• Heavily regulated industry
• Multiple barriers of protection or safeguards
  makes any accidental event difficult
• Deliberate attacks are the new accident scenarios
  to be addressed not much experience in this so
  credibility has to be taken into consideration
• Location of vessels in transit makes it an
  unfavorable target

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Understanding Reality / Communications

• Current risk based approach have identified more
  undesirable events and hazard mechanisms that
  have to be studied
• Hazard and Risk Management work has been focused
  on design accidental events hazards have been
  managed by industry
• Safety management system of operators have
  focused on accurate risk identification for
  continuous improvement
• Approach has either been consequence or
  likelihood reducing risk management strategy to
  address identified undesirable events.
• Security concerns now have to be addressed as
  part of the risk management picture

17
Understanding Reality / Communications

• Good industry record with regards to HSE
• Security Vulnerability assessments make the
  industry less vulnerable to an accidental event
• Still some uncertainties in the modeling of the
  spill scenario (dispersion and subsequent fire)
  and the causes of the leaks on the vessels
• Difficulty in communications of the effectiveness
  of the barriers of protection or safeguards that
  will make the potential accidental events
  unlikely to occur
• Success dependent on communication and acceptance
  by public

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Understanding Reality / Communications
Causes
Consequences
Pump Failure
Jet Fire
Equipment Failure
Pool Fire
Operator Error
Gas Explosion
Catastrophic Event e.g. Gas Leak
Inductive
Deductive
Process Failure
Reasoning
Reasoning
Environmental Extreme Conditions
Gas Cloud
Control Valve Failure
Fire Ball
Instrument Air Failure
Fault Tree
Event Tree
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Way Forward

• More focus on the modeling of accidental events
• Better understanding of different failure
  mechanisms
• Improve sharing of information to improve risk
  management (communications to public critical)
• Development of performance goals that could
  improve profitability and safety of facilities

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Lessons Learned from the Application of Risk
Management in the Shipment of LNG

• Ben Poblete
• HSE Manager Senior Risk Management Specialist
• LRNA - Houston
• PREPARED FOR
• 21th Annual CCPS International Conference
• Orlando, FL
• 23 27 April 2006