Operational Risk Management (ORM) Update

Julia Swindle – IADC James Hebert – Diamond Offshore Jason Wilson – Transocean

IADC ORM Taskforce

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• Established in early 2014 at the request of

Executive Committee

• Participation by drilling contractors and operators based in US and Europe

• Objective – establish an IADC position on Operational Risk Management

• Output – Position Paper with a recommendation for next steps

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Operational Risk Management

• Safety is more than managing slips, trips and falls

• ORM focuses on the management of major hazards

• Successful companies do it well • It is a license to operate

• ORM is more than Safety

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ORM – What is it?

“The identification of major hazards, and prevention / management of their associated risks,

to promote operational and asset integrity”

• Applies to the complete range of potential major hazards in Upstream operations

• Proactive and dynamic management of control barriers

ORM vs. Occupational Safety

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Multiple fatalities

Single fatality

Recordable injury

First Aid Case

Near Hit / Miss

Catastrophic Events

Operational Risk

Occupational Safety

ORM vs. Occupational Safety

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Consequence

Frequency

High

Low High Low

Operational Risk

Management

Personal / Occupational

Safety

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ORM and Process Safety

• Process Safety derives from chemical industry • Fire, explosion and accident chemical releases • Relevant to a well-defined consistent process • Defined by OSHA within Process Safety

Management legislation

• ORM is appropriate to the larger set of major hazards associated with Upstream operations

• Process Safety is considered an important component of ORM

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Major Hazards

Defined within IADC HSE Case Guidelines • Multiple fatalities or permanent total disabilities • Extensive damage to structure of installation • Massive effect to the environment

Examples: • Loss of well integrity • Fire • Explosion • Loss of vessel stability • Loss of water-tight integrity

• Mooring / station-keeping failure

• Helicopter crash • Terrorism & piracy • Epidemic diseases

Management System Relationship

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Policy

Planning

Operations

Monitoring

Management Review

CHECK

PLAN

DO

ACT

• Policy Statement • Strategic objectives • Goals / targets

Management System Relationship

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Policy

Planning

Operations

Monitoring

Management Review

CHECK

PLAN

DO

ACT

• Hazard identification • Risk Assessment • Safety critical positions • Safety critical system • Safety critical tasks • Inherently safer design • Training needs analysis • Interface arrangements • Combined Ops / SIMOPS • Emergency Response

planning and preparedness

Management System Relationship

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Policy

Planning

Operations

Monitoring

Management Review

CHECK

PLAN

DO

ACT

• Knowledge, skills and abilities

• Asset integrity • Barrier management • Safe operating limits • Fit for Purpose • Management of Change • Performance Standards • Safety critical tasks • Performance reporting • Incident reporting • Emergency Response • Crisis management

Management System Relationship

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Policy

Planning

Operations

Monitoring

Management Review

CHECK

PLAN

DO

ACT

• Competency assurance • Assurance / verification

of barriers / controls vs. Performance Standards

• Auditing • Performance monitoring

Management System Relationship

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Policy

Planning

Operations

Monitoring

Management Review

CHECK

PLAN

DO

ACT

• Performance analysis • Improvement Plans • Resource allocation

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This is not new to IADC

And, we are not alone

Deepwater Well Control Guidelines

Drilling Manual

HSE Case Guidelines Master Service Contract

Surface BOP Guidelines Advanced Rig Technology Comm.

HSE Committee.

Maintenance Committee

Rig Moving Committee

Managed Pressure Drilling and Underbalanced Operations Conf.

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Close

• Conclusions • Operational and asset integrity • Management of major hazards • Low frequency / high consequence events • ORM is not new – we have many of the tools

• Next steps

• Finalize ORM Position Paper and engage Committees and membership

• Form ORM Committee • Develop an ORM Guideline document

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