Facility Risk Management in Developing Countries

By Stickles, R. Peter; Firth, Louise M. | Risk Management, October 1990 | Go to article overview

Facility Risk Management in Developing Countries


Stickles, R. Peter, Firth, Louise M., Risk Management


Facility Risk Management In Developing Countries

Developing countries depend on dynamic industrial growth to support their economic objectives. Yet growth without the necessary management of environmental and public health risks can adversely affect a country, causing disability and death to certain segments of the population. In the short term it can lead to public concern and demonstrations against new projects, as is the case in some newly industrialized nations. Undoubtedly, finding the proper balance between encouraging industrial growth and managing risks is a challenge for government and industry alike.

The disaster in Bhopal galvanized world attention to the acute risks involved in the manufacture of pesticides. However, facilities and infrastructure associated with the production of fertilizer, petroleum and chemicals can also pose significant risks. For example, anhydrous ammonia is a toxic chemical widely used as a fertilizer in developing countries. Hydrogen sulfide is created during the recovery of natural gas. And the manufacture of petrochemicals involves the production of ethylene, propylene, butadiene and chlorine. Furthermore, developing countries often recover and/or use liquified petroleum gas as domestic fuel. A significant release of pressurized petroleum gas can result in a catastrophe such as the explosion and fire at a terminal belonging to Mexico's national oil company, PEMEX LPG, in Mexico City in 1984

Many industrial-related catastrophic events have occurred in underdeveloped regions. Although each situation is unique, there are common problems related to the human elements of process safety. For example, there is typically no process risk management by any definition. In addition, since most of the plants in these countries were originally low-cost designs, they have minimum instrumentation and few automatic emergency systems. At these locations there are few, if any, preventive maintenance programs. Equipment and plant maintenance involves repair work only when machinery breaks down. This situation is exacerbated by logistical difficulties in obtaining spare parts, which are often unavailable in the domestic market. Documentation of a business' operational procedures and practices is also often lacking, and consequently, training procedures are incomplete if not non-existent.

Tiers of Risk

A quantitative risk assessment of a facility or process unit involves a major allocation of a company's human resources and can take a long time to implement. This is particularly true if there are several plant locations or manufacturing sites with multiple units such as in chemical complexes or petroleum refineries. Yet a detailed study is not always necessary to identify the areas for risk reduction at the plant level. In some cases a survey approach may be best. It uses experienced technical and safety personnel to locate major hazards and rank them in terms of relative risk.

Because quantitative risk assessment is an involved process, companies are incorporating a multitiered approach. The three-tiered risk assessment presented in the Risk Management Tiers diagram on page 49 is usually adopted by medium and large chemical and petroleum companies. The first level, risk screening, is a topdown review of worst-case potential hazards and risks designed primarily to prioritize sites or areas within a plant that pose the greatest risk. Factors considered include inventory of hazardous materials, hazardous material characteristics, storage conditions and population distribution. Risk screening relies mainly on data and information furnished by the site and involves little or no site inspection. The results provide an indication of the extent of hazards and potential for risk exposure. More formalized programs use hazard ranking indexes, such as the Dow Chemical Exposure Index, to determine the need for further review of risk or risk mitigation.

The second level involves conducting a risk survey that combines site inspection with established risk assessment techniques applied in a semiquantitative fashion. …

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