Risk and Risk Management Concepts

Running head: RISK AND RISK MANAGEMENT CONCEPTS
Risk and risk management concepts
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2RISK AND RISK MANAGEMENT CONCEPTS
Table of Contents
Risk and Risk Management Concepts (Literature Review)............................................................3
Risk and Vulnerability Concepts.....................................................................................................5
Vulnerability................................................................................................................................6
Figure 1: Process safety indicator pyramid.................................................................................8
Discussion....................................................................................................................................8
The emergence of risk events........................................................................................................13
Figure 2: Timeline showing attributes of Black Swan..............................................................16
The gap in research:.......................................................................................................................17
Definition:..................................................................................................................................18
Highlighting the main concepts:................................................................................................18
Preparedness:.............................................................................................................................19
Fault Tress analysis:..................................................................................................................20
Figure 3: Fault Tree Diagram....................................................................................................21
RIFs from frameworks reviewed:..............................................................................................21
Figure 4: Machine Model..........................................................................................................23
Relevant RIF’s and ACR...........................................................................................................24
Figure 5: Factors Influencing Managers Behavior....................................................................26
Figure 6: Safety Critical Parameters to APR.............................................................................27

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Figure 7: Relevant RIF’s and PR...............................................................................................29
Risk Modeling...............................................................................................................................31
Terminology of Risk Influence Modeling.....................................................................................33
Figure 8: Time Series of Reviewed Risk Influence Models......................................................34
Process of Rating.......................................................................................................................36
Model Review............................................................................................................................38
Quantitative Aspects......................................................................................................................38
Period Risk.................................................................................................................................40
Link to Risk Models..................................................................................................................40
Requirements needed to analyze methods for Activity-Related Risk Analysis........................40
Levels of RIF Structure.............................................................................................................41
Qualitative Aspects........................................................................................................................42
Operational Risk in Oil and Gas Industry Conceptual Framework...............................................58
Overview of Risk.......................................................................................................................59
Questionnaires...........................................................................................................................60
Identification of Hazard.............................................................................................................61
Hazards to be considered...........................................................................................................61
Vapor Cloud Explosions............................................................................................................62
Pool Fires...................................................................................................................................62

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Figure 9: Graph of Auto Ignition Temperature compared with Average Carbon Chain Length
...................................................................................................................................................63
Flame Jets and Vapor Cloud (Flash) Fires................................................................................65
Fireballs and BLEVEs...............................................................................................................66
Toxic Dispersion from Sour Water............................................................................................67
Hazard Scenarios.......................................................................................................................68
Generic Scenarios......................................................................................................................70
Non-Generic Scenarios..............................................................................................................70
Vessel Selection.........................................................................................................................71
Release Duration........................................................................................................................74
Table –Guidelines for establishing Continuous Release Detection and Isolation Times Based
On API 581................................................................................................................................74
Failure Frequencies....................................................................................................................75
Generic Failure Frequency Data for Equipment........................................................................76
Table: Generic Equipment Failure Rate Data from API-581(Hydrocarbon Service)...............76
Non-Generic Failure Frequency Calculation.............................................................................77
LOPA Methodology..................................................................................................................78
Table: Sample Scenario Identification and Frequency Estimation Summary Sheet using LOPA
...................................................................................................................................................79
Table: Initiating Causes and Likelihood of Failure...................................................................81

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Table: Probability of Failure on Demand for Independent Layers................................................82
Application of Methodology..........................................................................................................82
Conclusion.................................................................................................................................86
Methodology..................................................................................................................................86
Introduction................................................................................................................................86
Research Philosophy..................................................................................................................87
Positivism..................................................................................................................................87
Realism......................................................................................................................................88
Justification of adopting Interpretivism and Positivism............................................................88
Knowledge philosophy..............................................................................................................89
Research process........................................................................................................................89
Research Strategy......................................................................................................................89
Qualitative Research Methodology...........................................................................................90
Quantitative Research................................................................................................................90
Adopting the Mixed Research Methodology.............................................................................91
Research Processes....................................................................................................................91
Survey........................................................................................................................................91
Questionnaire.............................................................................................................................92
Drawbacks.................................................................................................................................93
Interviews..................................................................................................................................94

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Case Study.................................................................................................................................95
References......................................................................................................................................97

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Risk and Risk Management Concepts (Literature Review)
In the year 2009, scientists, Andrew Hale along with Andrew Hopkins issued a safety
Science special issue defining the different kinds of process safety indicators. The total process
was completed by the help of researchers specifically the help included nineteen different
contributions. Apart from this there were also safety experts and consultants of large companies
of the market. The journals which were scientific by nature were restricted mainly to
Ergonomics. The different parts of the following topic on risk management were presented from
different sources of different countries and continents that included the likes of Asian, North
American, European and Central Asian sources. The following sources helped the researchers to
formulate their research in a much arranged and detailed way which was necessary for the proper
functioning of the organization. Some of the main journals that have been taken as a main source
for the following include the likes of Journal of Industrial Engineering, Journal of Loss
Prevention in the process industries, Process Safety and Environmental Protection and many
more as such. The issue was the start of the following literary review of the research. This
included review of both the scientific and the professional literature. The International
Organization of Oil and Gas Producers, Organization for Economic Cooperation and
Development and many other similar organizations as such serve as the perfect literary source of
the professional literature. The professional report can be considered to be one of the most
genuine works and is generally acceptable to a much larger group of audience. Therefore the
professional literature has a much larger scope when compared to any other forms of literary
sources. There have been different instances where safety breach has led to fatal incidents. Some
of the most prominent disasters are provided in the table below. This includes;

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High Risk Industries Period (1970 to 1980) Period (2000 to 2010)
Nuclear Disaster Chernobyl, 1986 Fukushima, 2011
Aerospace Challenger, 1986 Colombia, 2003
Chemical & Petrochemical Flixborough, 1976
Bhopal, 1984
Tolouse, 2001
Texas City, 2003
Railways Clapham Junction, 1987 Ladbroke Grove, 1999
Maritime 1 Zeebrugge,1987 Costa Concordia, 2012
Maritime 2 Raxon Valdez, 1987 Erika, 2003
Air Traffic Management Zagreb, 1976 Umberlingen, 2002
Fuel Storage Port Edward Heriot, 1987 Bouncefield, 2005
Aviation Tenerife,1977 Rio Paris, 2009
Normally Risk Management procedures involves a lot of different terms including the
likes of the defense, protection layer, Safety critical element, safety functions and many more as
such. The above mentioned disasters show that risk is involved in almost every kind of industries
and that it acts as the main reason for the industries to take different safety measures to avoid
such disasters. The coupling present between the different system elements reflects the presence
or absence of buffers in between the system elements and also helps to create the variability of
the system process steps. Leading and lagging are nowadays not approved by most of the modern
authors. The rising levels of competition in the market and the economic condition of the market
will be responsible for a number of different threats. This will force the management of the
organizations to formulate different risk management strategies to counter the different threats.