B.2.1 Risk Acceptance Principles
The following goals of the company are formulated:
A guiding principle for the Company's approach to risk acceptance is that the ALARP principle shall be implemented. Risk levels as low as reasonably practicable (ALARP) shall be achieved by the implementation of risk reducing measures (technical, operational, organisational) that comply with all the following criteria:
(a) are technically and operationally feasible
(b) have a significant risk reduction effect in relative terms, when compared with the initial risk levels, after due allowance for the additional risk associated with their implementation, operation and maintenance
(c) do not involve costs grossly disproportionate to the expected benefit.
The ALARP principle shall be applied for all relevant dimensions of risk, personnel, environment, and assets.
Furthermore; the company has a written instruction stating that the decision- making process and its results must be documented. There is a procedure for con- ducting ALARP evaluations, which includes the following elements:
x Description of all identified risk reduction proposals for risk to personnel, environment and assets.
x Analysis of risk reduction proposals must be qualitative as well as quanti- tative. The qualitative approaches should be:
o Use of good practice o Use of codes and standards o Engineering judgement o Stakeholder consultation o Tiered challenge.
Cost-benefit/cost effectiveness analysis is the appropriate quantitative analysis approach, when relevant.
x Documentation of those proposals that are not decided for implementation and the associated residual risk level.
x Implementation plan for those risk reduction proposals that will be imple- mented.
B.2.2 Illustration of ALARP Process
Risk assessments are intended to ensure that solutions are found in accordance with authority requirements and expectations, internal company requirements and accepted industry practice. It is required that the following aspects are addressed:
1. Are all authority requirements satisfied?
2. Are all internal requirements met?
3. Is the analysed risk level on a par with that of comparable concepts/- solutions?
4. If some requirements or practices are not met, can it be demonstrated that the concept nevertheless does not represent an increased risk level?
5. If quantitative targets are defined, are these met with sufficient margin, in order to enable any possible later increase in analysed risk levels, without the need for extensive changes?
6. Is Best Available Technology (BAT) used?
7. Have solutions been chosen with inherent safety standards?
8. Are there any unsolved problems or areas of concern with respect to risk to personnel and/or working environment, or areas where these two aspects are in conflict?
9. Are there any unsolved problems in relation to serious environmental spill?
10. Is the concept robust with respect to safety?
11. Have aspects of the most recent R&D results and other new experience been considered?
The following considerations should as a minimum be made, and subsequent solu- tions and actions be implemented:
1. Identify possible technical and/or operational improvements of the instal- lation that may contribute to reduced risk to personnel
a. without substantial capital or operational costs, or other operatio- nal drawbacks
b. and simultaneously improves operation or maintenance, so that any increase in capital costs is offset by savings in operational costs.
2. Identify possible technical and/or operational improvements that may reduce environmental spill risk
a. without substantial capital or operational costs, or other opera- tional drawbacks
b. and simultaneously improves operation or maintenance, so that any increase in capital costs is offset by savings in operational costs.
These evaluations should be made without any cost/ benefit comparison or similar considerations.
When all measures that may fulfil the above criteria have been exhausted, the following evaluations should be performed:
3. Identify possible technical and/or operational improvements that may reduce risk to personnel or environment, but which entails substantially increased capital or operational costs or other operational drawbacks. The following assessments should be made for these alternatives:
a. Overall expected net present value of all costs and income per statistical fatality averted.
b. Cost distribution (material damage and delayed/deferred produc- tion income) for relevant years, given the occurrence of a major accident, with respect to scenarios that are influenced by the measures being considered.
c. Overall expected net present value of all costs and income per statistically expected reduced 1000 tons of oil spill.
d. Cost distribution (clean up costs, compensation claims, etc.) for relevant years, given the occurrence of a major oil spill, with respect to scenarios that are influenced by the measures being considered.
e. Loss of reputation for relevant years, for relevant years, given the occurrence of a major accident or major oil spill, with respect to scenarios that are influenced by the measures being considered.
The values that are computed in Step 3 above may be compared to reference values, if stated, for:
x Cost per statistical fatality averted
x Cost per statistically expected 1000 tons of reduced oil spill
x Maximum loss that the company is able to survive in one single year.
Finally, it should be considered if higher limits may be accepted under special circumstances:
x Higher costs per averted statistical life lost, if the initial risk level is high x Higher costs per statistically expected 1000 tons of oil spill, if the initial
environmental risk is high
x Higher costs per statistically expected 1000 tons of oil spill, if the areas that may be exposed to spills are particularly sensitive.
The present ALARP evaluation is limited to protection of escape ways in case of fire, and is thus limited to personnel safety. Environmental risk is therefore not addressed at all.
B.2.3 Cost-Benefit Analysis
Section 5.4 presented the process and generation of alternatives. Table 5.4 presen- ted the results of the Cost-Benefit Analysis.