Incorporating API Code RP2SIM(Risk Based Inspection)

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Risk Based Inspection: Incorporating RP 2SIM into SIM strategies

Introduction

With low oil prices eroding profit margins, the need to maintain operational quality and productivity of existing o�shore platforms is stronger than ever.

In November 2014, the American Petroleum Institute (API) published a guidance document titled RP 2SIM: Structural Integrity Management of Fixed O�shore Structures, suggesting new standards for the inspection, maintenance and repair (IMR) of assets.

This recommended practice mainly focuses on the evaluation of structural damage for risk reduction. It is widely expected that these guidelines will revolutionize the approach to structural integrity management (SIM) across the Gulf of Mexico, especially for the assessment of fitness-for-purpose of the structures.

Gulf of Mexico: Oil and Gas Active Platforms (Gulf of Mexico Fact Sheet, U.S. Energy Information Administration)

Particularly relevant in this context is risk based inspection, a process to ensure asset integrity by fostering a more e�ective alignment between decision-making and risk.

The present report provides the outcomes of a series of in-depth interviews conducted with leading personalities of the industry, with the goal of understanding how to ensure the sustainability of structural items through the implementation of new approaches to SIM such as risk based inspection.

A proactive approach to structural integrity management

Current approaches to structural integrity management are based on a reactive maintenance strategy. They do not manage to properly determine the probability of failure nor the possible consequences related to failure.

Hence, by prescribing fixed time inspections intervals, conventional methods often cause overspending on assets which do not require urgent attention and conversely underspending on assets which need investment.

While conventional inspections may be adequate for the majority of structures, they are not seen as suitable for all existing platforms.

“Ninety percent of the assets in the Gulf of Mexico region are well managed through current regulations and recommended practices. However, the most valuable assets are in the 10% which is not being managed properly,” said Robert Sheppard, Senior Principle Advisor at Energo, a special structural engineering company for the oil and gas industry.

Hence, practices adopting a “one size fits all” approach are often inappropriate to guarantee the sustainability of all structural items, especially those with a higher commercial value.

Instead, RP 2SIM suggests a holistic approach to the risk management of all existing o�shore platforms throughout their lifecycle. The shift towards risk based inspection approaches to structural integrity management is encouraging more proactive strategies, since operators can allocate maintenance budgets ahead of time, handling resources more e�ectively.

“RP 2SIM will certainly enforce a more proactive and risk-orientated approach to asset management. It is essential to understand the condition of each asset and to develop a strategy for the whole lifecycle of the structure, as opposed to the next five years,” said Robert Sheppard (Energo).Most of the techniques included in RP 2SIM are already being implemented, albeit sporadically, throughout the Gulf of Mexico. While the majors are already putting these recommendations into practice, the smaller operators are rapidly catching up by hiring engineering companies.

Defining a SIM strategy based on your risk appetite

The largest operators usually know their risk profile and are able to categorize the integrity of each of their assets. However, most of the smaller ones do not yet have a systematic approach to the identification and management of risk. Thus, initially the main challenge for the operators will be to identify the specific threats to the integrity of each of their plants. An e�ective evaluation of the structural condition of the assets presupposes reliable and up-to-date data management systems.

Although there may be initial di�culties in the application of RP 2SIM standards, the benefits of its implementation could be remarkable.

“Managing the structure with a long-term view will save millions in lost revenue. It will also create new commercial opportunities for the businesses themselves”, said Robert Sheppard (Energo).

RP 2SIM suggests a sophisticated approach, tailored to the requirements of each individual platform, in order to manage structural risk throughout the lifecycle of the asset.

“New standards have put in one place the lessons learned in the last 20 years. They will allow to create more proactive, and commercially e�cient inspection, maintenance and repair strategies,” added Robert Sheppard.

The introduction of RP 2SIM is triggering a paradigm shift, creating a shared understanding across the industry concerning the risk assessment of existing o�shore platforms. For the first time there is a document approved by the industry which sets clear directions in this respect.

New approaches to structural integrity management have an inherent financial value for the industry as a whole. They allow not only to save money, but also to protect the existing o�shore platforms of the Gulf of Mexico against major threats, from ageing to natural disasters.

In a context of low oil prices, structural integrity management provides the tools to e�ciently manage existing assets, in order to generate higher profit margins. What is more, the RP 2SIM approach is much more flexible in terms of timescales and inspection schedules, allowing companies to define long-term strategies based on their own risk appetite.

Operators will be encouraged to treat every asset individually and to set their own risk criteria, as long as they are justifiable. Thus, new standards are likely to provoke a shift towards strategies which allows a more sophisticated assessment of risk.

Understanding risk based inspection (RBI) within the RP 2SIM framework

Risk based inspection is the process of devising inspection plans for the assets in order to ensure e�ective implementations of structural integrity management. These long-term planning strategies will be conducive to more informed decision.

“This is not a new concept, but the practice itself is not yet well recognized throughout the industry. However, this is set to change with the introduction of RP 2SIM,” said Riaz Khan, Principal of Structural Integrity at the Malaysian oil and gas company Petronas.

According to Khan, risk based inspection developed back in the 1990s as a more proactive strategy to manage o�shore platforms, prioritizing the most at-risk assets and designing inspection strategies to maintain them operational throughout their lifecycle.

While evaluating its fleet in the Gulf of Mexico, BP needed to identify the structures with higher risk of failure in order to understand how to protect them against the risk of extreme natural events.

The risk of hurricanes in the Gulf of Mexico is extremely high and the economic impact of these events on the business is substantial in terms of platform failures and cost to industry. According to estimates, the hurricanes Katrina and Rita destroyed no less than 113 platforms with combined insured losses to the assets of about of $15 billion.

Crude oil and natural gas production in the Federal O�shore Gulf of Mexico and the impact of selected hurricanes and tropical storms, 2005-2012 (Short-Term Energy Outlook Supplement: 2013 Outlook for Gulf of Mexico Hurricane-Related Production Outages)

Several platforms had already been operating for more than twenty years and were therefore subject to ageing and life extension (ALE) issues.

Thus, it was vital to understand how to prioritize the inspections of structural items, in order to e�ectively preserve their integrity and to prevent potential threats to the environment and public health.

This was implemented by identifying the platforms which presented high risk, and thus needed urgent repair, and those were the risk was considered tolerable and whose maintenance could be safely postponed.

“Risk based inspection removes wasted investment from the inspection strategies for assets who do not need to be inspected nor maintained over a shorter period of time, giving more flexibility in terms of reacting to market conditions,” said Riaz Khan (Petronas).

Later on, Riaz Khan employed a risk based inspection strategy throughout global integrity operations at Petronas, a company which he joined in 2010.

“This new approach demonstrated significant gains for Petronas as a business. Allowing to prioritize the inspection and maintenance of the assets, risk based inspection takes a more proactive approach to risk management in the long-term, across the whole life of the structure,” added Riaz Khan (Petronas).

Applying ALARP principles in line with the risk profile of your organization

Being based on prescriptive practices in relation to the frequency of inspections, conventional approaches were expensive and not always useful to recognize the areas of greatest concern.

In contrast, risk based inspection applies “As Low As Reasonably Practicable” (ALARP) principles, thus identifying the assets with require attention, ranking first those which present higher risk of failure.

Both good engineering practice and cost-benefit analysis help to establish whether the risk is ALARP. Hence, if budgets decrease, the inspection plans for the safer assets can be adjusted accordingly, assuming they align with the risk profile of the organization.

Such an approach also ensures the engineer is abiding by sound standards, while operating in a manner which is justifiable to both its company and the regulator.

There are several issues which need to be taken into account to develop an e�ective risk based inspection strategy based on ALARP principles, such as the safety of the workforce employed on o�shore installations and the potential environmental hazard caused by equipment failure.

Thus, it is vital to precisely assess the fatigue damage of ageing o�shore platforms, also in relation to the exposure to di�erent environmental loads such as waves, currents and winds.

An accurate estimation of risk factors and their potential e�ects can generate cost savings by extending the operating life of the assets.

“The initial phases of a risk based inspection strategy are based on the knowledge of the fleet conditions. If these are not known, the inspection and maintenance plan cannot be fully prioritized,” said Riaz Khan (Petronas).

Robert Sheppard (Energo) stressed that first risks need to be properly recognized and assessed, then targets should be set according.

Enhancing data management

One of the main challenges consist in conducting a comprehensive inventory, especially in relation to the items at risk of failure, and in properly ensuring the reliability of all the data necessary to evaluate the actual operating conditions of the structure.

“Absent data is a massive issue here, as it precludes a complete understanding of the asset itself,” continued Riaz Khan (Petronas).

Hence, a lack of reliable data easily leads to wasted budget on inspection. When engineers do not know the condition of the structures, they often need to assume that the structure is in the worse possibly condition.

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With contributions from:

However, also an excessive amount of information can be problematic to process and analyze. In this respect, several software solutions are available in order to screen, collect and categorize relevant data.

Operators will certainly be encouraged to improve their own data management strategies, in order to properly evaluate and quantify the risks posed by a potential failure and to ensure the delivery of corrective intervention strategies.

In this respect, the development of more e�cient monitoring tools to collect large amount of relevant data will further improve structural integrity management strategies.

Revolutionizing the industry: The arrival of a new type of engineer

The introduction of risk based inspection strategies is revealing the existence of a significant knowledge gap within the industry between design engineers and integrity engineers, according to Riaz Khan (Petronas).

While design engineers usually need rules and instructions to follow, integrity engineers are instead asked to create new strategies based upon existing data sets.

“RP 2SIM will revolutionize the approach to structural integrity. Currently there are very few engineers who truly understand the benefits and practice of risk based structural management integrity. New recommended practices will most likely create a new type of engineer,” said Riaz Khan (Petronas).

Innovation is already revolutionizing the industry. The Clear Gulf Joint Industry Project (JIP), which gathers professionals from the oil and gas industry and the NASA Johnson Space Center in Houston, is an interesting example in this respect.

Clear Gulf JIP is inspired by the same approach which RP 2SIM is implementing. It provides systems to measure the physical properties which could potentially lead to failure, in order to ensure structural integrity and prevent interruptions and damage.

“Learning from the aerospace industry, in particularly from NASA, our JIP demonstrates the importance and commercial benefits that can be achieved by incorporating a preventative maintenance strategy,” said David Brower, founder and president of Astro Technologies, the provider of instrumentation and monitoring solutions which is collaborating with NASA for this project.

“In the aerospace industry, these new approaches have proven to be e�ective means of reducing expenditure and prolonging the lifetime of the assets,” added David Brower.

Overall, innovative strategies have the potential to broaden the technological capabilities of the oil and gas industries and to lead to substantial savings in constructions and operations.

Conclusion

The adoption of RP 2SIM is seen as critical to the evolution of the industry. Implementation of this recommended practice could revolutionize the industry, allowing operators to be more creative and e�cient in the manner in which they manage their structures.

Strategies such as risk based inspection (RBI) mean that di�erent assets will be treated di�erently according to their di�erent risk levels. What is more, RBI is expected to encourage innovation, while reducing operational costs and increasing profit margin.

By recommending solutions concerning structural integrity management, RP 2SIM o�ers duty holders a comprehensive strategy to overcome flaws of the current system such as ine�ciencies, lost revenues and over-expenditure on low-risk assets.

Hence, a more e�ective SIM strategy for ageing structures will decrease the overall asset risk exposure, increasing safety and saving financial resources. Overall, the implementation of appropriate engineering decisions and integrity practices will allow operators to fully benefit from the paradigm shift taking place in the industry. Structural Integrity Management Conference, Gulf of Mexico2-3 June | Sheraton Brookhollow, Houston, Texas

Are you interested in any of the discussions brought forward in this paper? Check out the Structural Integrity Management Conference, Gulf of Mexico right here: http://www.decomworld.com/structural-integrity-management-usa/

Join 150+ Structural Integrity professional to define a SIM strategy to incorporate RP2SIM, mitigate extreme external events and integrate risk-orientated approach to age management:

• Debate the positives and negatives of risk-orientated approaches to IMR and the techniques you can use to define inspection intervals and the risk profiles of assets• Discover the value of structural monitoring technologies and advanced engineering solutions to enhance the e�ciency and commercial outlook of your fleet• Get exclusive insight into the market innovations and JIP’s which are currently under operation to enhance your perspective on more cost e�ective solutions to IMR operations• Understand how changes to the regulatory structure will drastically impact your asset management program and where RP2SIM with influence your SIMS• Discuss the strategies and innovations being employed by leading operators to mitigate the impact of extreme external events on your at-risk assets• Review new standards and technologies for Mooring Line Integrity to ensure you are taking the most proactive approach on your floating assets

DELEGATE PASSES ARE NOW AVAILABLE

Confirm your place now and save more than $600!! PLUS by downloading this report you are also entitled to an additional $50 discount – simply enter discount code RP2SIM50

Contact details:

Tom SapstedOperations Director | Upstream Intelligencet: +44 (0)0207 375 7523e: [email protected]

www.upstreamintel.com/structural-integrity-management-usa

Structural Integrity Management Conference, Gulf of Mexico

2-3 June | Sheraton Brookhollow, Houston, Texas 150+ Senior Structural Integrity professionals

25+ business critical presentations on risk-based inspection strategies, corrosion management and mitigation, fatigue analysis, metocean data, mitigation of Extreme Environmental Events, Mooring Line Tension, Hull integrity and new BSEE regulations

Practical case studies from leading operators’, including: Shell, BP, Petronas, Hess, Total, IntelliSIMS, Energo and Astro Technologies






Introduction

With low oil prices eroding profit margins, the need to maintain operational

quality and productivity of existing offshore platforms is stronger than ever.

In November 2014, the American Petroleum Institute (API) published a

guidance document titled RP 2SIM: Structural Integrity Management of

Fixed Offshore Structures, suggesting new standards for the inspection,

maintenance and repair (IMR) of assets.

This recommended practice mainly focuses on the evaluation of structural

damage for risk reduction. It is widely expected that these guidelines will

revolutionize the approach to structural integrity management (SIM) across

the Gulf of Mexico, especially for the assessment of fitness-for-purpose of

the structures.


Particularly relevant in this context is risk based inspection, a process to

ensure asset integrity by fostering a more effective alignment between

decision-making and risk.

The present report provides the outcomes of a series of in-depth inter-

views conducted with leading personalities of the industry, with the goal

of understanding how to ensure the sustainability of structural items

through the implementation of new approaches to SIM such as risk based

inspection.







Current approaches to structural integrity management are based on a

reactive maintenance strategy. They do not manage to properly determine

the probability of failure nor the possible consequences related to failure.

Hence, by prescribing fixed time inspections intervals, conventional

methods often cause overspending on assets which do not require urgent

attention and conversely underspending on assets which need investment.

While conventional inspections may be adequate for the majority of struc-

tures, they are not seen as suitable for all existing platforms.

Hence, practices adopting a “one size fits all” approach are often inappro-

priate to guarantee the sustainability of all structural items, especially those

with a higher commercial value.

Instead, RP 2SIM suggests a holistic approach to the risk management of

all existing offshore platforms throughout their lifecycle. The shift towards

risk based inspection approaches to structural integrity management is

encouraging more proactive strategies, since operators can allocate main-

tenance budgets ahead of time, handling resources more effectively.

“RP 2SIM will encourage a more proactive, risk-orientated approach to

asset management as opposed to simply doing the same inspections every

five years. It is essential to understand the condition of each asset and to

develop a strategy that can adapt as that condition changes through the

end of field life,” said Robert Sheppard, Chief Technical Advisor at Energo, a

specialty structural engineering company for the oil and gas industry.

Most of the techniques included in RP 2SIM are already being implement-

ed, albeit sporadically, throughout the Gulf of Mexico. While the majors are

already putting these recommendations into practice, the smaller opera-

tors are rapidly catching up by hiring engineering companies.


The largest operators usually know their risk profile and are able to catego-

rize the integrity of each of their assets. However, most of the smaller ones

do not yet have a systematic approach to the identification and manage-

ment of risk.

Thus, initially the main challenge for the operators will be to identify the

specific threats to the integrity of each of their plants. An effective eval-

uation of the structural condition of the assets presupposes reliable and

up-to-date data management systems.

Although there may be initial difficulties in the application of RP 2SIM stan-

dards, the benefits of its implementation could be remarkable.

RP 2SIM suggests a sophisticated approach, tailored to the requirements of

each individual platform, in order to manage structural risk throughout the

lifecycle of the asset.






“New standards have put in one place the lessons learned in the last 20 years.

They will allow to create more proactive, and commercially efficient inspec-

tion, maintenance and repair strategies,” added Robert Sheppard (Energo).

The introduction of RP 2SIM is triggering a paradigm shift, creating a

shared understanding across the industry concerning the risk assess-

ment of existing offshore platforms. For the first time there is a document

approved by the industry which sets clear directions in this respect.

New approaches to structural integrity management have an inherent

financial value for the industry as a whole. They allow not only to save

money, but also to protect the existing offshore platforms of the Gulf of

Mexico against major threats, from ageing to natural disasters.

In a context of low oil prices, structural integrity management provides

the tools to efficiently manage existing assets, in order to generate higher

profit margins. What is more, the RP 2SIM approach is much more flexible

in terms of timescales and inspection schedules, allowing companies to

define long-term strategies based on their own risk appetite.

Operators will be encouraged to treat every asset individually and to set

their own risk criteria, as long as they are justifiable. Thus, new standards

are likely to provoke a shift towards strategies which allows a more sophis-

ticated assessment of risk.


Risk based inspection is the process of devising inspection plans for the

assets in order to ensure effective implementations of structural integrity

management.

These long-term planning strategies will be conducive to more informed

decision.

“This is not a new concept, but the practice itself is not yet well recognized

throughout the industry. However, this is set to change with the intro-

duction of RP 2SIM,” said Riaz Khan, Principal of Structural Integrity at the

Malaysian oil and gas company Petronas.

According to Khan, risk based inspection developed back in the 1990s as

a more proactive strategy to manage offshore platforms, prioritizing the

most at-risk assets and designing inspection strategies to maintain them

operational throughout their lifecycle.

While evaluating its fleet in the Gulf of Mexico, BP needed to identify the

structures with higher risk of failure in order to understand how to protect

them against the risk of extreme natural events.

The risk of hurricanes in the Gulf of Mexico is extremely high and the

economic impact of these events on the business is substantial in terms of

platform failures and cost to industry. According to estimates, the hurri-

canes Katrina and Rita destroyed no less than 113 platforms with combined

insured losses to the assets of about of $15 billion.






Crude oil and natural gas production in the Federal Offshore Gulf of Mexico and the impact of selected hurricanes and tropical storms, 2005-2012

(Short-Term Energy Outlook Supplement: 2013 Outlook for Gulf of Mexico Hurri-cane-Related Production Outages)

Several platforms had already been operating for more than twenty years

and were therefore subject to ageing and life extension (ALE) issues.

Thus, it was vital to understand how to prioritize the inspections of struc-

tural items, in order to effectively preserve their integrity and to prevent

potential threats to the environment and public health.

This was implemented by identifying the platforms which presented high

risk, and thus needed urgent repair, and those were the risk was consid-

ered tolerable and whose maintenance could be safely postponed.

“Risk based inspection removes wasted investment from the inspection

strategies for assets who do not need to be inspected nor maintained

over a shorter period of time, giving more flexibility in terms of reacting to

market conditions,” said Riaz Khan (Petronas).

Later on, Riaz Khan employed a risk based inspection strategy through-

out global integrity operations at Petronas, a company which he joined in

2010.

“This new approach demonstrated significant gains for Petronas as a busi-

ness. Allowing to prioritize the inspection and maintenance of the assets,

risk based inspection takes a more proactive approach to risk management

in the long-term, across the whole life of the structure,” added Riaz Khan

(Petronas).







Being based on prescriptive practices in relation to the frequency of

inspections, conventional approaches were expensive and not always

useful to recognize the areas of greatest concern.

In contrast, risk based inspection applies “As Low As Reasonably

Practicable” (ALARP) principles, thus identifying the assets with require

attention, ranking first those which present higher risk of failure.

Both good engineering practice and cost-benefit analysis help to establish

whether the risk is ALARP. Hence, if budgets decrease, the inspection plans

for the safer assets can be adjusted accordingly, assuming they align with

the risk profile of the organization.

Such an approach also ensures the engineer is abiding by sound standards,

while operating in a manner which is justifiable to both its company and

the regulator.

There are several issues which need to be taken into account to develop

an effective risk based inspection strategy based on ALARP principles, such

as the safety of the workforce employed on offshore installations and the

potential environmental hazard caused by equipment failure.

Thus, it is vital to precisely assess the fatigue damage of ageing offshore

platforms, also in relation to the exposure to different environmental loads

such as waves, currents and winds.

An accurate estimation of risk factors and their potential effects can gener-

ate cost savings by extending the operating life of the assets.

“The initial phases of a risk based inspection strategy are based on the

knowledge of the fleet conditions. If these are not known, the inspec-

tion and maintenance plan cannot be fully prioritized,” said Riaz Khan

(Petronas).

Robert Sheppard (Energo) stressed that first risks need to be properly rec-

ognized and assessed, then targets should be set according.


One of the main challenges consist in conducting a comprehensive

inventory, especially in relation to the items at risk of failure, and in prop-

erly ensuring the reliability of all the data necessary to evaluate the actual

operating conditions of the structure.

“Absent data is a massive issue here, as it precludes a complete under-

standing of the asset itself,” continued Riaz Khan (Petronas).

Hence, a lack of reliable data easily leads to wasted budget on inspection.

When engineers do not know the condition of the structures, they often

need to assume that the structure is in the worse possibly condition.






However, also an excessive amount of information can be problematic to

process and analyze. In this respect, several software solutions are available

in order to screen, collect and categorize relevant data.

Operators will certainly be encouraged to improve their own data manage-

ment strategies, in order to properly evaluate and quantify the risks posed

by a potential failure and to ensure the delivery of corrective intervention

strategies.

In this respect, the development of more efficient monitoring tools to col-

lect large amount of relevant data will further improve structural integrity

management strategies.


The introduction of risk based inspection strategies is revealing the exis-

tence of a significant knowledge gap within the industry between design

engineers and integrity engineers, according to Riaz Khan (Petronas).

While design engineers usually need rules and instructions to follow,

integrity engineers are instead asked to create new strategies based upon

existing data sets.

“RP 2SIM will revolutionize the approach to structural integrity. Currently

there are very few engineers who truly understand the benefits and prac-

tice of risk based structural management integrity. New recommended

practices will most likely create a new type of engineer,” said Riaz Khan

(Petronas).

Innovation is already revolutionizing the industry. The Clear Gulf Joint

Industry Project (JIP), which gathers professionals from the oil and gas

industry and the NASA Johnson Space Center in Houston, is an interesting

example in this respect.

Clear Gulf JIP is inspired by the same approach which RP 2SIM is imple-

menting. It provides systems to measure the physical properties which

could potentially lead to failure, in order to ensure structural integrity and

prevent interruptions and damage.

“Learning from the aerospace industry, in particularly from NASA, our

JIP demonstrates the importance and commercial benefits that can be

achieved by incorporating a preventative maintenance strategy,” said David

Brower, founder and president of Astro Technologies, the provider of

instrumentation and monitoring solutions which is collaborating with NASA

for this project.

“In the aerospace industry, these new approaches have proven to be

effective means of reducing expenditure and prolonging the lifetime of the

assets,” added David Brower.

Overall, innovative strategies have the potential to broaden the techno-

logical capabilities of the oil and gas industries and to lead to substantial

savings in constructions and operations.






Conclusion

The adoption of RP 2SIM is seen as critical to the evolution of the indus-

try. Implementation of this recommended practice could revolutionize

the industry, allowing operators to be more creative and efficient in the

manner in which they manage their structures.

Strategies such as risk based inspection (RBI) mean that different assets will

be treated differently according to their different risk levels. What is more,

RBI is expected to encourage innovation, while reducing operational costs

and increasing profit margin.

By recommending solutions concerning structural integrity management,

RP 2SIM offers duty holders a comprehensive strategy to overcome flaws

of the current system such as inefficiencies, lost revenues and over-expen-

diture on low-risk assets.

Hence, a more effective SIM strategy for ageing structures will decrease

the overall asset risk exposure, increasing safety and saving financial

resources.

Overall, the implementation of appropriate engineering decisions and

integrity practices will allow operators to fully benefit from the paradigm

shift taking place in the industry.

Introduction

With low oil prices eroding profit margins, the need to maintain operational quality and productivity of existing o�shore platforms is stronger than ever.

In November 2014, the American Petroleum Institute (API) published a guidance document titled RP 2SIM: Structural Integrity Management of Fixed O�shore Structures, suggesting new standards for the inspection, maintenance and repair (IMR) of assets.

This recommended practice mainly focuses on the evaluation of structural damage for risk reduction. It is widely expected that these guidelines will revolutionize the approach to structural integrity management (SIM) across the Gulf of Mexico, especially for the assessment of fitness-for-purpose of the structures.


Particularly relevant in this context is risk based inspection, a process to ensure asset integrity by fostering a more e�ective alignment between decision-making and risk.

The present report provides the outcomes of a series of in-depth interviews conducted with leading personalities of the industry, with the goal of understanding how to ensure the sustainability of structural items through the implementation of new approaches to SIM such as risk based inspection.


Current approaches to structural integrity management are based on a reactive maintenance strategy. They do not manage to properly determine the probability of failure nor the possible consequences related to failure.

Hence, by prescribing fixed time inspections intervals, conventional methods often cause overspending on assets which do not require urgent attention and conversely underspending on assets which need investment.

While conventional inspections may be adequate for the majority of structures, they are not seen as suitable for all existing platforms.

“Ninety percent of the assets in the Gulf of Mexico region are well managed through current regulations and recommended practices. However, the most valuable assets are in the 10% which is not being managed properly,” said Robert Sheppard, Senior Principle Advisor at Energo, a special structural engineering company for the oil and gas industry.

Hence, practices adopting a “one size fits all” approach are often inappropriate to guarantee the sustainability of all structural items, especially those with a higher commercial value.

Instead, RP 2SIM suggests a holistic approach to the risk management of all existing o�shore platforms throughout their lifecycle. The shift towards risk based inspection approaches to structural integrity management is encouraging more proactive strategies, since operators can allocate maintenance budgets ahead of time, handling resources more e�ectively.

“RP 2SIM will certainly enforce a more proactive and risk-orientated approach to asset management. It is essential to understand the condition of each asset and to develop a strategy for the whole lifecycle of the structure, as opposed to the next five years,” said Robert Sheppard (Energo).Most of the techniques included in RP 2SIM are already being implemented, albeit sporadically, throughout the Gulf of Mexico. While the majors are already putting these recommendations into practice, the smaller operators are rapidly catching up by hiring engineering companies.


The largest operators usually know their risk profile and are able to categorize the integrity of each of their assets. However, most of the smaller ones do not yet have a systematic approach to the identification and management of risk. Thus, initially the main challenge for the operators will be to identify the specific threats to the integrity of each of their plants. An e�ective evaluation of the structural condition of the assets presupposes reliable and up-to-date data management systems.

Although there may be initial di�culties in the application of RP 2SIM standards, the benefits of its implementation could be remarkable.

“Managing the structure with a long-term view will save millions in lost revenue. It will also create new commercial opportunities for the businesses themselves”, said Robert Sheppard (Energo).

RP 2SIM suggests a sophisticated approach, tailored to the requirements of each individual platform, in order to manage structural risk throughout the lifecycle of the asset.

“New standards have put in one place the lessons learned in the last 20 years. They will allow to create more proactive, and commercially e�cient inspection, maintenance and repair strategies,” added Robert Sheppard.

The introduction of RP 2SIM is triggering a paradigm shift, creating a shared understanding across the industry concerning the risk assessment of existing o�shore platforms. For the first time there is a document approved by the industry which sets clear directions in this respect.

New approaches to structural integrity management have an inherent financial value for the industry as a whole. They allow not only to save money, but also to protect the existing o�shore platforms of the Gulf of Mexico against major threats, from ageing to natural disasters.

In a context of low oil prices, structural integrity management provides the tools to e�ciently manage existing assets, in order to generate higher profit margins. What is more, the RP 2SIM approach is much more flexible in terms of timescales and inspection schedules, allowing companies to define long-term strategies based on their own risk appetite.

Operators will be encouraged to treat every asset individually and to set their own risk criteria, as long as they are justifiable. Thus, new standards are likely to provoke a shift towards strategies which allows a more sophisticated assessment of risk.


Risk based inspection is the process of devising inspection plans for the assets in order to ensure e�ective implementations of structural integrity management. These long-term planning strategies will be conducive to more informed decision.

“This is not a new concept, but the practice itself is not yet well recognized throughout the industry. However, this is set to change with the introduction of RP 2SIM,” said Riaz Khan, Principal of Structural Integrity at the Malaysian oil and gas company Petronas.

According to Khan, risk based inspection developed back in the 1990s as a more proactive strategy to manage o�shore platforms, prioritizing the most at-risk assets and designing inspection strategies to maintain them operational throughout their lifecycle.

While evaluating its fleet in the Gulf of Mexico, BP needed to identify the structures with higher risk of failure in order to understand how to protect them against the risk of extreme natural events.

The risk of hurricanes in the Gulf of Mexico is extremely high and the economic impact of these events on the business is substantial in terms of platform failures and cost to industry. According to estimates, the hurricanes Katrina and Rita destroyed no less than 113 platforms with combined insured losses to the assets of about of $15 billion.

Crude oil and natural gas production in the Federal O�shore Gulf of Mexico and the impact of selected hurricanes and tropical storms, 2005-2012 (Short-Term Energy Outlook Supplement: 2013 Outlook for Gulf of Mexico Hurricane-Related Production Outages)

Several platforms had already been operating for more than twenty years and were therefore subject to ageing and life extension (ALE) issues.

Thus, it was vital to understand how to prioritize the inspections of structural items, in order to e�ectively preserve their integrity and to prevent potential threats to the environment and public health.

This was implemented by identifying the platforms which presented high risk, and thus needed urgent repair, and those were the risk was considered tolerable and whose maintenance could be safely postponed.

“Risk based inspection removes wasted investment from the inspection strategies for assets who do not need to be inspected nor maintained over a shorter period of time, giving more flexibility in terms of reacting to market conditions,” said Riaz Khan (Petronas).

Later on, Riaz Khan employed a risk based inspection strategy throughout global integrity operations at Petronas, a company which he joined in 2010.

“This new approach demonstrated significant gains for Petronas as a business. Allowing to prioritize the inspection and maintenance of the assets, risk based inspection takes a more proactive approach to risk management in the long-term, across the whole life of the structure,” added Riaz Khan (Petronas).


Being based on prescriptive practices in relation to the frequency of inspections, conventional approaches were expensive and not always useful to recognize the areas of greatest concern.

In contrast, risk based inspection applies “As Low As Reasonably Practicable” (ALARP) principles, thus identifying the assets with require attention, ranking first those which present higher risk of failure.

Both good engineering practice and cost-benefit analysis help to establish whether the risk is ALARP. Hence, if budgets decrease, the inspection plans for the safer assets can be adjusted accordingly, assuming they align with the risk profile of the organization.

Such an approach also ensures the engineer is abiding by sound standards, while operating in a manner which is justifiable to both its company and the regulator.

There are several issues which need to be taken into account to develop an e�ective risk based inspection strategy based on ALARP principles, such as the safety of the workforce employed on o�shore installations and the potential environmental hazard caused by equipment failure.

Thus, it is vital to precisely assess the fatigue damage of ageing o�shore platforms, also in relation to the exposure to di�erent environmental loads such as waves, currents and winds.

An accurate estimation of risk factors and their potential e�ects can generate cost savings by extending the operating life of the assets.

“The initial phases of a risk based inspection strategy are based on the knowledge of the fleet conditions. If these are not known, the inspection and maintenance plan cannot be fully prioritized,” said Riaz Khan (Petronas).

Robert Sheppard (Energo) stressed that first risks need to be properly recognized and assessed, then targets should be set according.


One of the main challenges consist in conducting a comprehensive inventory, especially in relation to the items at risk of failure, and in properly ensuring the reliability of all the data necessary to evaluate the actual operating conditions of the structure.

“Absent data is a massive issue here, as it precludes a complete understanding of the asset itself,” continued Riaz Khan (Petronas).

Hence, a lack of reliable data easily leads to wasted budget on inspection. When engineers do not know the condition of the structures, they often need to assume that the structure is in the worse possibly condition.

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However, also an excessive amount of information can be problematic to process and analyze. In this respect, several software solutions are available in order to screen, collect and categorize relevant data.

Operators will certainly be encouraged to improve their own data management strategies, in order to properly evaluate and quantify the risks posed by a potential failure and to ensure the delivery of corrective intervention strategies.

In this respect, the development of more e�cient monitoring tools to collect large amount of relevant data will further improve structural integrity management strategies.


The introduction of risk based inspection strategies is revealing the existence of a significant knowledge gap within the industry between design engineers and integrity engineers, according to Riaz Khan (Petronas).

While design engineers usually need rules and instructions to follow, integrity engineers are instead asked to create new strategies based upon existing data sets.

“RP 2SIM will revolutionize the approach to structural integrity. Currently there are very few engineers who truly understand the benefits and practice of risk based structural management integrity. New recommended practices will most likely create a new type of engineer,” said Riaz Khan (Petronas).

Innovation is already revolutionizing the industry. The Clear Gulf Joint Industry Project (JIP), which gathers professionals from the oil and gas industry and the NASA Johnson Space Center in Houston, is an interesting example in this respect.

Clear Gulf JIP is inspired by the same approach which RP 2SIM is implementing. It provides systems to measure the physical properties which could potentially lead to failure, in order to ensure structural integrity and prevent interruptions and damage.

“Learning from the aerospace industry, in particularly from NASA, our JIP demonstrates the importance and commercial benefits that can be achieved by incorporating a preventative maintenance strategy,” said David Brower, founder and president of Astro Technologies, the provider of instrumentation and monitoring solutions which is collaborating with NASA for this project.

“In the aerospace industry, these new approaches have proven to be e�ective means of reducing expenditure and prolonging the lifetime of the assets,” added David Brower.

Overall, innovative strategies have the potential to broaden the technological capabilities of the oil and gas industries and to lead to substantial savings in constructions and operations.

Conclusion

The adoption of RP 2SIM is seen as critical to the evolution of the industry. Implementation of this recommended practice could revolutionize the industry, allowing operators to be more creative and e�cient in the manner in which they manage their structures.

Strategies such as risk based inspection (RBI) mean that di�erent assets will be treated di�erently according to their di�erent risk levels. What is more, RBI is expected to encourage innovation, while reducing operational costs and increasing profit margin.

By recommending solutions concerning structural integrity management, RP 2SIM o�ers duty holders a comprehensive strategy to overcome flaws of the current system such as ine�ciencies, lost revenues and over-expenditure on low-risk assets.

Hence, a more e�ective SIM strategy for ageing structures will decrease the overall asset risk exposure, increasing safety and saving financial resources. Overall, the implementation of appropriate engineering decisions and integrity practices will allow operators to fully benefit from the paradigm shift taking place in the industry. Structural Integrity Management Conference, Gulf of Mexico2-3 June | Sheraton Brookhollow, Houston, Texas

Are you interested in any of the discussions brought forward in this paper? Check out the Structural Integrity Management Conference, Gulf of Mexico right here: http://www.decomworld.com/structural-integrity-management-usa/

Join 150+ Structural Integrity professional to define a SIM strategy to incorporate RP2SIM, mitigate extreme external events and integrate risk-orientated approach to age management:

• Debate the positives and negatives of risk-orientated approaches to IMR and the techniques you can use to define inspection intervals and the risk profiles of assets• Discover the value of structural monitoring technologies and advanced engineering solutions to enhance the e�ciency and commercial outlook of your fleet• Get exclusive insight into the market innovations and JIP’s which are currently under operation to enhance your perspective on more cost e�ective solutions to IMR operations• Understand how changes to the regulatory structure will drastically impact your asset management program and where RP2SIM with influence your SIMS• Discuss the strategies and innovations being employed by leading operators to mitigate the impact of extreme external events on your at-risk assets• Review new standards and technologies for Mooring Line Integrity to ensure you are taking the most proactive approach on your floating assets

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Contact details:

Tom SapstedOperations Director | Upstream Intelligencet: +44 (0)0207 375 7523e: [email protected]

Expert Speakers Include:

Pat O'ConnorChair Person ISO 19901-9

SIM Committee

Hugh Westlake Structural Technical

Authority BP

Nigel Wayne Nichols Structural Technical

Authority Petronas

Hongbo Shu Mooring Systems

SME and Technical Authority

Shell

Doug Kemp O�shore Americas & West Africa Integrity

Advisor Hess






Incorporating API Code RP2SIM(Risk Based Inspection)

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