Lloyd’s Register Energy Canada Limited - LREC

Risk-Based Inspection Program

Best Practice – Executive
Summary
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Agenda
• Understanding – What is a Risk-Based Inspection (RBI)
Program
• Identified Failures of a RBI Program
• Critical Success Factors for a “Best Practice” RBI
Program
• RBI Program Value
• RBI Program Components and Involvement
• Summary
• Questions
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Understanding
– What is a Risk-Based Inspection (RBI) Program?
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What is Risk-Based Inspection (RBI)?

“a risk assessment and management process that is focused on

loss of containment of pressurized equipment in processing
facilities, due to material deterioration. These risks are managed
primarily through equipment inspection.”

American Petroleum Institute (API) RECOMMENDED PRACTICE

(RP) 580
SECOND EDITION, NOVEMBER 2009
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RBI Program – From API RP 580 Management Process

Source – Directly from API RP 580, Second Edition Nov. 2009, Page 30
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Risk is the Product of Two Parts

Risk is a measure of BOTH

PROBABILITY of a failure

AND

CONSEQUENCE of a failure
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Typical Risk Matrix

Probability Ranking
1 HIGH Consequence
A-Catastrophic
B-Very Serious
2 MED HIGH C-Serious
D-Significant
E-Minor
3 MEDIUM
Probability
1-Very High
2-High 4 LOW
3-Moderate
4-Low
5-Very Low 5
E D C B A
Consequence Ranking
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Consequence and Probability for Risk-Based

Inspection
RBI focuses on a particular risk:
• The risk of a loss due to the loss of a pressure boundary by
inspectable causes
Possible consequences:
• Injury/fatality (safety) due to a toxic or flammable event
• Environmental damage
• Production Loss
• Minimal impact (this is considered)
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Risk is Time-Dependent

Next Year

Today
Risk, Events per Year

Time, t
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What’s RBI All About? Using Inspection to Manage Risks

Unacceptable Risk/POF
Probability of Failure

Inspect and fix if needed

Inspection Interval Time

• Risk-Based Inspection is Proactive – It Utilizes the Information
Available to Manage Risk
• Time-Based Methodology is Read and React
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Identified Failures of a RBI Program

• So….an RBI Programs are in place…..Are they working?

• What kind of RBI Program failures are expected?
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Identified Failures of a RBI Program

Please note: Client = Operator, Vendor = RBI Consultant/Services
Organization
• No Structured Approach to a RBI Program (Client/Vendor Issue)
• The RBI Tool Implementation is completed by unqualified personnel
and management (both Client/Vendor) and it’s “Check the box”
• Once RBI Tool is Implemented, Client is Expected to be an “Expert”
• No Operational Documentation – Specifically for the Sustain Phase
• No Transition or Change Management Process from Time Based to a
RBI Program
• Failure to Measure Value and Results = Failure to Continually Improve
• Inconsistent RBI Methodology
• Poorly Executed Sustain Phase due to lack of Expertise
….and so on…..
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What do the Failures tell us about the RBI Programs?

• No Structure for the RBI Program, including the Program

itself and the Operation
• Lack of Expertise and Experience
• No Partnership between Client and Vendor
• The Components of the RBI Program are Weak or
Nonexistent
• No Feedback of Value or Key Performance Indicators
(KPIs)

• What can be done about this to make sure the RBI

Program is a Success AND a Best Practice?
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Five Critical Success Factors for

“Best Practice” RBI Program

1. Successful RBI Tool Implementation

2. Develop Operational Documents
3. Execute a Transition Phase
4. Establish a Training Program
5. Sustain and Review RBI Program
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Other Key Information to Achieve Best Practice

• Each RBI Program should have Four

Phases
• Implement
• Transition These be
considered one
• Sustain
Dynamic phase
• Review/Measure
• Client / Vendor Partnership MUST
exists for Each Phase
• Client / Vendor Involvement Changes
throughout each Phase
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Graphic of the Critical Success Factors to a Best

Practice RBI Program with Phases and Involvement
01/28/2013
01/28/2013Establish and Implement Training Program
01/28/2013
Develop Operational Documentation Measure with KPIs
Involvement

High
Vendor
Sustain
Implementation Transition &
Review
Client
Low
Time Line
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More Information about each of the Five Critical

Success Factors of a Best Practice RBI Program
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1. Successful RBI Tool Implementation

• Successful RBI Tool (e.g. Software)

Implementation – planned and coordinated via a
Vendor-Client partnership, and executed by the 1

Probability Ranking
HIGH
Vendor. 2 MED HIGH

• The Implementation Phase is considered the 3 MEDIUM

selection, installation, and deployment of the 4 LOW

RBI Tool to facilitate the RBI Program. 5
E D C B A
• It is a requirement that this phase is Consequence Ranking
completed with a defined scope including the
most accurate information as possible.
• It is assumed that this Phase is conducted by
qualified and experience personnel with the
Vendor.
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2. Develop Operational Documents

• Develop and Implement Operational Documents

for RBI Program during the Implementation
Phase for Program Sustainability (Evergreening)
– coordinated via a Vendor-Client partnership.
• The RBI Operational Documents are
Processes and Procedures that guide and
enable Business Units and Operators (users)
of the RBI program to achieve best practice
results.
• Following the development of these
documents, the Client must train and
execute the operation of the RBI program
defined by these documents.
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3. Execute a Transition Phase

• Execute a Transition Phase from

Implementation to Sustainability
(Evergreening) and Review Phases –
coordinated via a Vendor–Client
partnership.
• The Phase transitions the RBI Program
to Sustainability and facilitates Client
resource development.
• The Vendor is an operational consultant
for the RBI Program, and provides
resources, training, support, and
guidance to provide value to the Client.
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4. Establish a Training Program

• Establish and Implement a Training Program –
This action is planned and initiated by the
Vendor and executed jointly through the
Client and the Vendor together. This propels
the Client into the Sustain Phase.
• This program builds the Client’s expertise
in execution of the RBI program through
the tool and operational documents of the
RBI program in preparation for the
Sustainability and Review Phase.
• Establishing this program ensures that the
Client resource expertise is developed at a
sustainable level.
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5. Sustain and Review RBI Program

• Sustain and Review the RBI Program by measuring Key
Performance Indicators (KPIs) – coordinated via a Vendor-
Client partnership.
• This Sustain and Review Phase dynamically updates the
RBI program with fresh results and measures the RBI
Program with KPIs.
• KPIs such as dollar value savings and risk level reduction
are used to indicate progress towards achieving best
practice as well as providing value-visibility to
management.
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Value Gained Through RBI

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Value of RBI Program

Time Based vs. Risk Based Inspection Intervals
Potential Savings in Percentage
• Risk-Based Inspection Intervals for
Assets can exceed Time Based 100%
Inspection Intervals by GREATER 90%
than 2 times the length 80%
• With RBI Assessments, each Asset 70%
can reduce inspection costs and 60%
mechanical integrity related down 50%
times by at least HALF the costs Time Based
40% Risk Based
• The chart indicates the potential 30%
savings of Assets with Risk-Based
20%
Inspection assessment intervals
10%
0%
Turnaround Turnaround Turnaround
1 2 3
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Overview of the Components of a RBI Program

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Typically There are Three Base Components for Each

Phase of a Best Practice RBI Program
• Components for Each Phase – Tools, Process/Procedure, and People
are Required
• Thus to fill those components with the best solution, Vendors and
Clients must work together The Four Phases
Tool Software
Sustain

People Implementation Transition Dynamic Process

RBI
Review
Program
Operational Qualified
Documents Resources
Vendor Vendor & Client Client & Vendor

Process/Procedure
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Why is a Client / Vendor Partnership Important?

• Where Experts and Processes are not available – Each

party can supplement each other!
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Client / Vendor Involvement Typical Involvement

Phases
Implementation Transition Sustain / Review

Vendor
Actual Involvement Client
Involvement (Solid Line)

Desired
Involvement for
Best Practice
(Dotted Line)

Vendor
Client

Time
Lloyd’s Register Energy Canada Limited - LREC

Client / Vendor Involvement Best Practice Involvement

Phases
Implementation Transition Sustain / Review

Vendor
Client
Involvement

Vendor

Client

Time
Lloyd’s Register Energy Canada Limited - LREC

Summary
• Understanding – What is a Risk-Based Inspection (RBI)
Program
• Identified Failures of a RBI Program
• Critical Success Factors for a “Best Practice” RBI
Program
1. Successful RBI Tool Implementation
2. Develop Operational Documents
3. Execute a Transition Phase
4. Establish a Training Program
5. Sustain and Review RBI Program
• RBI Program Value
• RBI Program Components and Involvement