Lessons Learned from

the Application of Risk

Management in the
Shipment of LNG
Outline of Presentation
• Introduction / History of LNG shipping

• Regulatory Regime

• Overview of Risks of LNG Shipping

• Current LNG Risk Management Practice

• Assessment of the Impact

• Understanding Reality / Communications

Introduction / History
• 30 + yrs experience with LNG marine transport
• Physical properties and behavior of LNG remains
constant
• Significant research work on LNG spills on water and
land by some of the major producers
• No historic major failures in the shipping of LNG
• Results of research work has been incorporated into
industry guidance notes.
Introduction / History
• Ship considered as the containment system

• System contains the cargo and provides protection to

the ship hull from the extremely cold temperatures of
the cryogenic cargo.

• Membrane type LNG tanker does not restrict the view

from the bridge.

• Independent tank is self-supporting

Introduction / History
Membrane

Primary Insulation
Primary Barrier Membrane
Secondary Insulation
Secondary Barrier
Introduction / History
Spherical Type B

Tank Dome

Insulation
Pipe Tower

Skirt
Introduction / History
Prismatic Type B

Insulation

Aluminum
Cargo Tank

Chocks
Regulatory Regime
• IMO (IGC) / SOLAS / ISPS / SIGTTO / Local rules
and regulations have provided guidance during
design and operations
• Hazard and Risk Management work has been
focused on design accidental events – hazards have
been managed by industry
• Consistency in the management of the LNG hazards
for all operator
• Security and Vulnerability scenarios are newest
addition
Authorities Domain Engineering Domain

Hazard Identification?

Declaration of Goals and Objectives?

Hazard Assessment?

Hazard Evaluation?

Formulation of Acceptance Criteria?

Hazard Treatment –
Prescriptive Requirements?
Hazard Treatment –
Prescriptive Solution

Approval

Monitoring

Conventional Hazard Management Process

 Authorities Domain Engineering Domain

Declaration of Goals and

Objectives?
Hazard Identification?

Hazard Assessment?

Risk Evaluation?
Formulation of Acceptance Criteria
(Life Safety & Third Party)

Risk Treatment –
Performance Based Options

Approval Risk Treatment –

Performance Based Solution

Monitoring

Performance Based Hazard Management Process

Overview of Risks of LNG Shipping
• Incident Scenario dealing with grounding, collision and
fire
• Focused on spills on water during grounding/collision,
leaks during transfer operations and fire and explosion
on ship or at the port
• Newest scenario after 9/11 is terrorism and sabotage.
Scenario development and credibility approach. Security
concerns now have to be addressed as part of the risk
management picture
• Using risk management strategy to address identified
undesirable events.
Current LNG Risk Management Practice
• Formal risk management technique in the identification and
management of health, safety, environmental and security
concerns.
• Risk management process is supported by the ISM, ISPS and
federal/country codes governing LNG shipping throughout the
world
• The success of this risk assessment process is the correct
identification of the undesirable events
• The difficulty with the currently adopted risk management
process is the development of acceptable criteria that
satisfies both the public perception and regulatory body
needs; these criteria will be the measurement of satisfaction
from the public
Reasons for Risk Management Option
• Industry trends to Risk-based design
• Industry trends to Risk-based management of
integrity in service
• Enables approval of novel arrangements
• Effort focused proportionately on critical areas
• Better “fit” with requirements of Safety Case /
Formal Safety Assessment
• Resolves conflicts between marine practice and
petrochemical codes
• Perceived Industry preference
Elements of Risk Management
• Identify
• Assess
• Define means to reduce risk
• Establish priorities
• Allocate resources
• Communicate
• Monitor
Assessment of the Impact
• No significant loss of LNG tank cargo during 80,000+
loaded transits since 1950’s
• Understanding of chemical and physical properties of
LNG
• Heavily regulated industry
• Multiple barriers of protection or safeguards makes
any accidental event difficult
• Deliberate attacks are the new accident scenarios to
be addressed; not much experience in this so
credibility has to be taken into consideration
• Location of vessels in transit makes it an unfavorable
target
Understanding Reality / Communications
• Current risk based approach have identified more
undesirable events and hazard mechanisms that have to be
studied
• Hazard and Risk Management work has been focused on
design accidental events – hazards have been managed by
industry
• Safety management system of operators have focused on
accurate risk identification for continuous improvement
• Approach has either been consequence or likelihood
reducing risk management strategy to address identified
undesirable events.
• Security concerns now have to be addressed as part of the
risk management picture
Understanding Reality / Communications
• Good industry record with regards to HSE
• Security & Vulnerability assessments make the
industry less vulnerable to an accidental event
• Still some uncertainties in the modeling of the spill
scenario (dispersion and subsequent fire) and the
causes of the leaks on the vessels
• Difficulty in communications of the effectiveness of the
barriers of protection or safeguards that will make the
potential accidental events unlikely to occur
• Success dependent on communication and
acceptance by public
 Understanding Reality / Communications
Cause Consequences
Pump Failure s
Jet Fire
Equipment
Failure Pool Fire

Operator Error
Gas
Explosion
Deductive Catastrophic Inductive
Process Failure
Event
Reasoning e.g. Gas Reasoning
Environmental
Extreme Leak Gas
Conditions Cloud

Control Valve
Failure Fire
Ball
Instrument Air
Failure
Fault Tree Event Tree
Way Forward

• More focus on the modeling of accidental events

• Better understanding of different failure mechanisms
• Improve sharing of information to improve risk
management (communications to public critical)
• Development of performance goals that could improve
profitability and safety of facilities