risk management the essential elements of pipeline risk ...by w.kent muhlbauer, wkm consulting,...
TRANSCRIPT
40 | Pipelines International | March 2018 Follow us on Twitter @Pipelines | www.pipelinesinternational.com www.pipelinesinternational.com | Follow us on Twitter @Pipelines March 2018 | Pipelines International | 41
RISK MANAGEMENTRISK MANAGEMENT
The inaugural article of this regular column – vintage 2012 – questioned whether formal risk assessments
performed on pipelines were truly helping all stakeholders to understand and manage risks. Much has been accomplished since then to help practitioners more efficiently and more accurately measure risk, but the newer ideas and methods have still not yet reached all corners of our industry.
The essential elements proposed back in 2011 have now been tested and battle-hardened; they have proven to be a complete and helpful guide to establishing or judging methodologies. That is why this is a good time to revisit that first article where the essential elements of good risk assessment were introduced.
SUPERIOR RISK ASSESSMENTAs the desire for more robust pipeline risk
management grows, so too does the need for superior risk assessment. A formal risk assessment provides the structure to increase understanding, reduce subjectivity and ensure that important considerations are not overlooked; the associated decision making is therefore more consistent and reliable when formal techniques are used.
But has pipeline risk assessment been
improving? Not according to some regulators, including in the US, who – since 2011 – have voiced scepticism regarding how pipeline operators are measuring risks.
This column seeks to address this situation by offering insights into risk concepts, especially efficient and appropriate ways to measure pipeline risk. Tackling the specifics of pipeline risk in bite-sized portions will hopefully make this challenging subject more approachable to those not yet well initiated.
We begin with the immediate concern of how to help ensure efficient regulatory oversight.
The Pipeline and Hazardous Materials Safety Administration’s recent criticisms are not unjustified. There is currently great disparity in approaches and level of rigour applied to risk assessment by pipeline operators.
This is largely due to the absence of complete standards or guidelines covering this complex
topic. The disparity leads to inconsistent and problematic oversight by regulatory agencies.
Without some standardisation, or at least consistency of understanding, auditors cannot readily determine where deficiencies may lie. On the other hand, too much standardisation – a mandated, prescriptive approach – is inefficient and stifles innovation in this complex arena.
INTEGRITY MANAGEMENTFormal risk assessment is relatively immature in
most industries, including pipelining. Many relative risk assessment techniques in current use by pipeline operators were developed before formalised and regulated integrity management programs (IMP) were established.
As such, the assessments often do not meet the demanding objectives of the more recent regulatory initiatives. As the author of one of the most widely used indexing models, I can attest
W. Kent Muhlbauer is a regular columnist for Pipelines International, author of Pipeline Risk Assessment: the Definitive Approach and its Role in Risk Management, and presenter of the Advanced Pipeline Risk Management course run internationally with Clarion Technical Conferences and Tiratsoo Technical.
For details surrounding the essential elements, see www.pipelinerisk.net
The essential elements proposed back in 2011 have now been tested and battle-hardened; they have proven to be a complete and helpful guide to establishing or judging methodologies.
that such models were not designed for many of the applications now envisioned by regulatory IMP or other uses of risk assessment that are becoming commonplace today.
Due to the simplicity offered by relative or scoring type risk assessment models, their usage became widespread. However, most of the early models will indeed require modifications in order to keep up with the new demands.
A mandated risk assessment approach is not the best solution. That would introduce a prescriptive element with substantial ‘overhead’ related to the establishment and documentation of the approach's specific requirements.
A better solution is to establish guidelines of essential ingredients necessary in any pipeline risk assessment. Critical elements would be identified and it would be left to the operator’s subject matter expert (SME) to detail those elements.
Properly crafted, a defined list of the essential ingredients in a risk assessment would introduce a beneficial amount of standardisation without becoming prescriptive. Specifying that all risk assessments contain, at a minimum, a few essential ingredients ensures that both regulators and the regulated are on the same page.
For example, possible essential elements include the following:
1. A definition of ‘failure’ to accompany a measurement of ‘probability of failure’ (PoF).
2. A measure of consequence potential, separate from the PoF measurement and
representative of the full range of possible consequences.
3. Production of a risk profile – all failure mechanisms and consequence potential must be measured at all points along a pipeline, showing changes in risk along the entire route. Summary values of risk – aggregating values from point to point – must be producible without masking true risks.
4. Sufficient resolution – the risk assessment must divide the pipeline into segments where risks are unchanging. While modern risk assessment routinely produces hundreds of segments per kilometre, a rule of thumb is that less than about 10-20 segments per kilometre is suspicious.
5. All inputs and results must be measurements (or estimates) expressed in commonly used and verifiable units. The use of measurements (e.g. events/km-year, mpy, etc.) instead of points or scores reduces subjectivity and complexity (it’s actually simpler once the scoring system is discontinued) and allows validation.
6. Measurements (or estimates) of the three key aspects of PoF – i.e. the attack, the effectiveness of each of the defences and the resistance to failure if all defences are breached – are required for every failure mechanism. Without an estimate of each
PoF ingredient independently, a full understanding of PoF is not possible.
7. A theoretical remaining life estimate for each time dependent failure mechanism is required. Without this, how can an integrity re-assessment interval be defensible?
8. A level of conservatism for inputs and other model aspects must be declared. For example, an assessment might reflect P50 (most likely) or, alternatively, P99 (worst case) risks; note that both are useful, but for different applications.
Perhaps we can all agree that, regardless of the specifics of modelling, a list of essential elements such as these must be a part of a proper risk analysis. The essential elements recommended here are actually very simple concepts and easy to implement.
As a side benefit, potential modelling issues surrounding aspects such as ‘threat interaction’ and ‘proper aggregation of risk results’ largely disappear when these elements are present.
When all parties agree on what is essential and everyone measures those essential things in some fashion, then everyone is ‘speaking the same language’.
A limited amount of standardisation in measuring risk is therefore appropriate and useful to all stakeholders. Expectations are managed, audits run smoother, information sharing is improved and risk management becomes more efficient.
As the need for better risk management continues, pipeline operators’ formal risk assessment methodologies must keep pace in order to remain relevant. This article revisits the essential elements of risk assessment introduced in 2012. This is the idea of developing efficient and appropriate risk measurements to help stakeholders and operators better understand and effectively manage risk.
by W. Kent Muhlbauer, WKM Consulting, Austin, Texas, US
The essential elements of pipeline risk assessment
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FLORIDA
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KEYNAME OWNER PRODUCT CAPACITY
LENGTH (miles)
1 El Paso Natural Gas Pipeline System Kinder Morgan Gas 6,182 MMcf/d 10,200
2 Algonquin Gas Transmission Spectra Energy Partners Gas 3,347 MMcf/d 1,129
3 Texas Eastern Transmission Spectra Energy Partners Gas 7,332 MMcf/d 9,022
4 Tennessee Gas Pipeline Kinder Morgan Gas 6,686 MMcf/d 13,900
5 Panhandle Eastern Pipeline Panhandle Energy Gas 2,840 MMcf/d 6,445
6 Northern Natural Gas Pipeline Northern Natural Gas Gas 7,442 MMcf/d 14,700
7 ANR Pipeline ANR Pipeline Company Gas 7,129 MMcf/d 10,600
8 Transcontinental Gas Pipeline Williams Gas 8,466 MMcf/d 10,500
9 Gulf South Pipeline Gulf South Pipeline Company Gas 6,260 MMcf/d 6,886
10 Natural Gas Pipeline Co of America Kinder Morgan Gas 4,848 MMcf/d 9,200
11 Florida Gas Transmission Pipeline Florida Gas Transmission Company Gas 2,217 MMcf/d 4,889
12 Kern River Gas Transmission Pipeline Kern River Gas Transmission Company Gas 1,833 MMcf/d 1,680
13 Trunkline Pipeline Panhandle Energy Gas 3,025 MMcf/d 4,202
14 Texas Gas Transmission Boardwalk Pipelines Gas 4,065 MMcf/d 5,671
KEYNAME OWNER PRODUCT CAPACITY
LENGTH (miles)
15 Southern Star Central Pipeline Southern Star Gas 2,801 MMcf/d 5,803
16 Dominion Pipeline Dominion Resources Gas 6,655 MMcf/d 3,505
17 Colorado Interstate Gas Pipeline Kinder Morgan Gas 4,099 MMcf/d 4,300
18 Alliance Pipeline System* Alliance Pipeline Gas 2,053 MMcf/d 2,311
19 Columbia Gulf Transmission Columbia Pipeline Group Gas 2,386 MMcf/d 4,124
20 Northern Border Pipeline* TC PipeLines; ONEOK Partners Gas 2,400 MMcf/d 1,408
21 Great Lakes Gas Transmission Pipeline* Great Lakes Gas Transmission Company Gas 2,958 MMcf/d 2,115
22 Transwestern Interstate Pipeline Energy Transfer Gas 2,439 MMcf/d 2,560
23 Questar Pipeline Questar Pipeline Gas 3,192 MMcf/d 1,858
24 Wyoming Interstate Pipeline Kinder Morgan Gas 2,736 MMcf/d 800
25 Centerpoint Energy Gas Transmission CenterPoint Energy Gas 5,385 MMcf/d 6,374
26 Northwest Pipeline* Williams Gas 4,950 MMcf/d 3,880
27 Southern Natural Gas Company System Kinder Morgan Gas 3,967 MMcf/d 7,635
28 Gas Transmission Northwest* TransCanada Gas 2,636 MMcf/d 1,356
KEYNAME OWNER PRODUCT CAPACITY
LENGTH (miles)
29 Columbia Gas Transmission NiSource Gas Transmission & Storage Gas 9,350 MMcf/d 10,365
30 National Fuel Gas Supply Corporation System National Fuel Gas 2,312 MMcf/d 2,300
31 Keystone Pipeline* TransCanada Crude oil - 2,639
32 Seaway Pipeline Enterprise Products Partners; Enbridge Crude oil 850,000 bbl/d 500
33 Gulf Coast Project TransCanada Crude oil 700,000 bbl/d 485
34 Longhorn Pipeline Magellan Midstream Partners Crude oil - 700
35 Double H Pipeline Hiland Partners Crude oil 84,000 bbl/d 485
36 Pony Express Pipeline Tallgrass Energy Crude oil 230,000 bbl/d 690
37 Olympic Pipeline BP Crude oil 315,000 bbl/d 400
38 Trans-Alaska Pipeline System Alyeska Pipeline Service Company Crude oil - 800
39 US Mainline (Lakehead System)* Enbridge Crude oil 2,600,000 bbl/d 1,900
40 Alberta Clipper* Enbridge Crude oil 800,000 bbl/d 1,000
41 Roadrunner Gas Pipeline ONEOK Partners Gas 640 MMcf/d 200 miles
41 WesTex Gas Transmission Pipeline ONEOK Partners Gas 100 MMcf/d 2,227 miles
MAJOR PIPELINE SYSTEMS OF THE USA
Compiled and published by Great Southern Press Pty Ltd. Tel: +61 3 9248 5100
Product information and graphic design © Great Southern Press, 2016. Source map courtesy Map Resources.
www.mapresources.com.au
For additional copies of this poster and for advertising enquiries, email [email protected]
This map is intended as a general source of information only.
NOTE: This is a schematic representation and shows approximate routes of major US pipelines. It does not show exact pipeline routes. Route, length, and capacity information is approximate and intended as a guide only, and is correct as at May 2016.
A detailed overview of select existing major pipeline systems in the USA.
Pipelines marked with * indicate a pipeline route that begins in Canada.
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YUKON TERRITORY
NORTHWEST TERRITORIES
NUNAVUT
BRITISH COLUMBIA
ALBERTA
SASKATCHEWAN
MANITOBA
ONTARIO
QUEBEC
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LABRADOR
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HalifaxQuebec
Winnipeg
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St. John's
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Whitehorse
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Ottawa
KEYNAME OWNER PRODUCT LENGTH DIAMETER
1 Alberta Clipper (Line 67) * Enbridge Inc. Crude oil 1,069 km 36 inches
2 Alliance Pipeline * Enbridge Inc. (50%); Versan (50%) Natural gas 1,560 km 36–42 inches
3 Brunswick Pipeline Emera Brunswick Pipeline Company Natural gas 143 km 30 inch
4 Canadian Mainline TransCanada Pipelines Natural gas 14,114 km 36 inch
5 Cochin Pipeline System Kinder Morgan Propane and ethane-propane 995 km 12 inches
6 Deep Panuke Pipeline Encana Corporation Natural gas 175 km
7 Enbridge Pipelines (NW) Inc. System Enbridge Inc. Crude oil 855 km
8 Enbridge Mainline * Enbridge Inc. Crude oil 2,306 km 30–36 inches
9 Enbridge Westspur Pipeline Enbridge Inc. Crude oil 175 km 12 inches
10 Enbridge Southern Lights (Line 13) * Enbridge Inc. Crude oil 1,241 km 20 inches
11 Express-Platte Pipeline System * Spectra Energy Crude oil 434 km 24 inch
12 Foothills Pipeline System TransCanada Pipelines Natural gas 1,241 km 36–42 inches
13 Keystone Pipeline * TransCanada Pipelines Crude oil 1,227 km 30–36 inches
14 Maritimes and Northeast Pipeline Spectra Energy (77.53%); Emera (12.92%); ExxonMobil Corporation (9.55%) Natural gas 575 km 30 inch
15 Nova Gas Transmission Pipeline System (NGTL) TransCanada Pipelines Natural gas 24,373 km 16–42 inches
16 Ontario–Quebec Pipeline TransNorthern Pipeline Inc. Refined fuel products 850 km
17 PTC Pipeline Spectra Energy Natural gas liquids 930 km
18 Trans Mountain Pipeline System Kinder Morgan Crude oil and refined products 1,142 km 24–36 inches
19 TransQuebec and Maritimes Pipeline Mainline TransCanada Pipelines (50%), Gaz Metro (50%) Natural gas 572 km
20 Westcoast Pipeline System (B.C Pipeline) Spectra Energy Natural gas 2,900 km 24–42 inches
21 Dawn to Parkway Trunkline Union Gas Natural gas 257 km
* Pipeline continues into United States of America.
The Major Pipeline Systems of Canada map provides an overview of existing major pipeline systems in Canada that are over 100 km in length. The map includes the name, owner, product, approximate length and diameter of the pipeline.
Information used to collate this map was directly provided by companies, the National Energy Board (NEB) and the Canadian Energy Pipeline Association (CEPA).
Information on this map is intended as a general source of information only. Compiled and published by Great Southern Press Pty Ltd. Tel: +61 3 9248 5100
Product information and graphic design © Great Southern Press, 2016. Source map courtesy Map Resources.
www.mapresources.com.au
For additional copies of this poster and for advertising enquiries, email [email protected]
With the support of:
www.pipelinesinternational.com
MAJOR PIPELINE SYSTEMS OF CANADAA detailed overview of select existing major pipeline systems in Canada