Operational Performance and Predictive Risk – “The Next Phase of The Journey”
Petrotechnics Executive Vice President, Iain Mackay and Michael Rogers discuss Operational Risk Management and why thinking Beyond permitting is the “The Next Phase of The Journey”.
Editor in Chief for Scandinavian Oil & Gas, Michael Rogers interviews Iain Mackay in “The Next Phase Of The Journey.” Scandinavian Oil and Gas is a recognised and respected source of premium news and insight for the North Sea and European oil and gas leadership. Building on 25 years Petrotechnics’ experience in the industry, Mackay and Rogers discussed where the industry is heading and what role operational risk will play in meeting the new challenges…
“Solutions from Petrotechnics empower organisations in hazardous industries to proactively manage assets to reduce less risk and achieve more optimised performance. The Petrotechnics’ philosophy has lead a new approach to managing asset integrity risk, and Scandinavian Oil-Gas Magazine spoke with Executive Vice President Iain Mackay about how the company has been helping customers to manage risk and transform their frontline operations for over the past 25 years.
As Executive Vice President for Petrotechnics, Iain Mackay leads the organisation’s professional services, solutions delivery and support organisation. Since joining Petrotechnics in 1998, Mackay has been a key architect behind many of the company’s strategic initiatives including market and product segmentation.
Solutions from Petrotechnics work to standardise policies, rules and risk management practices across an organisation, enabling users to control and manage work safely and efficiently. In a nutshell, Mackay says, “we want to be recognised as having a breadth and depth of experience in making a real difference to more people going home safe every day.”
Could you relate a little about how your background has shaped your approach to Petrotechnics’ goals?
“Two significant things happened 26 years ago, within a week of each other. One is that I graduated with a mechanical engineering degree and a week later there was the Piper Alpha tragedy. When you come from the northeast of Scotland, and you want to be an engineer, it usually means in the oil industry. After Piper Alpha, I chose to have a slightly different career path and for the next 10 years I worked for companies such as Bechtel and later McDermott International. It was McDermott which brought me back into mainstream offshore oil and gas activities and frontline operations – and where I began to work with Petrotechnics.”
“Later, the more I understood about Petrotechnics in terms of a drive to improve front-line operational processes – and that drive was about being innovative and about using technology – I saw that Petrotechnics actually had thought process and skills that really interested me. And as part of a small company, I felt that I could make an impact. So compared to large organisations, where things move slower, Petrotechnics was the proverbial ‘speedboat’.”
How has Petrotechnics worked to steer the industry towards proactive risk management to ensure production efficiency?
“Where we started in Petrotechnics was really about improving the efficiency and effectiveness of frontline operation. But what we realised was that a lot of the initiatives around improvement – especially using technology – were viewed as optional, about information retrieval, for example. Some used the set of diagrams that they kept in their drawer – or they could use an EDMS [electronic document management system]. And what we found was that people chose the thing that they could guarantee was reliable and up-to-date. Typically that was a hard copy that the production supervisor or production engineer actually had on a desk in his office. And in making the link between that behaviour and the technology that was being used, we realised that for technology to be successful in frontline operations it had to be replacing what we call ‘in-line process’.”
“We realised that the whole system of work was a hugely fragmented – very inefficient – and an exclusively paper-based process. And not only was this an opportunity for us to fundamentally change the efficiency of frontline operations, but it would make working safer. So back in the 1999, what we first did was to create and introduce the first integrated safe system of work, which replaced paper with technology, as well as integrating – from both business and engineering perspectives – the core elements of permitting, risk assessment and isolation, lockout, tag-out, isolation management control.”
“And it was a bit of a revolution that took the industry a little time to assimilate and adopt. But 10 years later, 85 percent of the UKCS uses one system – and effectively one business process – for an integrated approach to their safe system or work.”
Tools from Petrotechnics enable operators to assess risk, including both Asset Integrity Risk and Work Management risk. What challenges did you face when designing a system that addresses such a broad spectrum?
“Around about 2000, the industry was still wrestling with the output from the Cullen Report on Piper Alpha, which was quite sometime after Lord Cullen posted his recommendations. But in 2000, we saw that the industry was really struggling with trying to understand how to implement the whole concept of suitable and sufficient risk assessment for all jobs – for all tasks. And this is one of the things that our approach offered – that an operator could do that in an effective, integrated way so that the people at the frontline actually got the benefit of the identification and mitigation of the hazards.”
“Now if I roll the clock forward, the last decade has been about safety management and asset integrity. This is not new, because the whole concept of process safety management is not new. But I think the industry has been really trying to figure out how they could effectively adopt and implement it.”
“From a workload risk perspective, you can risk-assess a job and you can have a fairly high quality understanding of the execution of managing the hazards associated with one job. But any facility has multiple jobs that need to be done simultaneously. So if you add the hazards associated with multiple jobs together, you get this concept of the cumulative risk associated with workload. The whole concept of workload cumulative risk is now fairly standard vocabulary within the industry.”
“On the asset integrity side, we have an industry – in the North Sea and in many parts of the world – where assets are operating with impressive, significant life extensions. Maintaining the integrity of the asset involves regulatory inspection, maintenance and addressing failures.”
“So if you take a ‘normal’ offshore installation, for example, you’ve got two things coming together: one is you’ve got people doing work – and this is in the context of the current status of the asset. You’ve got a compound effect that merges workload and current status of the asset together. And that’s the pinnacle of where you should be focusing your time and attention on operational risks. You’ve got workload risk and you’ve got asset integrity risk – but you’re trying to manage both simultaneously in a very dynamic environment.”
Proscient – your Operational Performance and Predictive Risk platform – enables operators to proactively optimise their work schedule to avoid risk in their overall dynamic plan. Could you describe how this works and the potential benefits for your customers?
“In the past, the industry relied on electronic permit to work (ePTW) systems. And back in 2010, we said to ourselves internally that ePTW is not the end answer – it is just a step on a journey towards a much broader operational risk management solution. And that’s where we started building and focusing on Proscient. So in 2013-2014, we now have many signals and many forces coming together to validate, not only Proscient but what’s happening in operational risk management, which the industry says it’s needed to meet the challenges of production efficiency and process safety management.”
“There’s a number of different roles within an organisation – whether production, planning, asset integrity or technical safety – but with Proscient, each role is able to look at three real-time views of what’s happening in terms of workload and asset integrity. There’s the time view, where the user has a schedule view of what is planned as well as what is are currently in progress. There’s a space view, so the user can see in real-time the plan of the entire facility and all work, including any integrity deviations associated with the facility. And there’s also a cumulative-risk dashboard – in real-time – of the cumulative effect of both asset integrity and workload. And these are constantly changing.”
“Now, Proscient optimises the ability to execute workload in a given environment, allowing the user to be mindful of the risks. So having these views are fundamental to your the cognitive understanding of what decisions you need to make and when you need to make them if you’re trying to do more work consuming fewer resources – and we do more work safer.”
As Gartner, the industry analysts, categorises it, ‘…tools for automation of risk assessment methodologies, the capture of operational data and although less prevalent, the use of analytics to create situational awareness and continuously manage risk.’ And that’s exactly what we do.”
Teekay Petrojarl has awarded Petrotechnics a contract to deploy Proscient across all of their floating production storage and offloading assets worldwide. How will Proscient be applied to Teekay Petrojarl’s needs?
“Teekay Petrojarl’s FPSO fleet is based out of Trondheim, Norway, and they’ve got ten assets existing in three regulatory environments: Brazil, Norway and the UK. No matter where any FPSO was operating anywhere in the world, Teekay Petrojarl wanted to ensure that their brought harmonisation to their operations in that the FPSOs are working in a common, standardised way across the fleet. So a global business model for safe work practices and how work gets done was established, and that global model will be rolled out to all of their FPSOs around the world.”
“Now there is a component that comes from our experience of doing this worldwide for the last decade – and that’s in order to make sure that policy is actually implemented in practice, you have to understand the true differences between the different regulatory environments. But equally, from a cultural perspective – considering people – you start to understand the amazing similarities, despite geography, culture or regulatory environments. I think from the management perspective in a lot of organisations it’s a concern. But in actual fact, despite geography or religion or culture, people’s core values are the same – everybody wants to go home safely.”
“The speed with which we’ve been able to establish a standard global model for Teekay Petrojarl has been very impressive. That speaks both to Petrotechnics’ knowledge and understanding of what ‘best practice in a box’ from around the world looks like, but also toTeekay Petrojarl’s very clear vision and desire to do just that – to have a standard business model applicable for their global fleet. The fit was very good and because of that we were able to have an agreed business process in a matter of weeks.”
One example of Petrotechnics’ use of new technology to better manage asset integrity risk and improve production efficiency has been the roll out of a Proscient app for iOS mobile devices. How has the industry responded thus far?
“There’s been a massive level of interest – the result, I think, of both social and business components – of the pervasive nature of mobile devices and tablets. Now, especially with younger generation, there is an expectation of having these tools and devices available in the workplace. The most important question from our perspective is, ‘What does mobility do for the business process?’ It allows people to access information, in hand, from multiple sources – and they are also allowed to do it at the worksite. And the point of need is on the worksite. So mobility revolutionises where people are in performing the functions that they need to perform.”
There’s been a considerable amount of evolution of Petrotechnics products and solutions since the company was founded 26 years ago. Looking ahead, what is your vision for Petrotechnics’ offerings in the future?
“I think the industry has to be more efficient and safer – these have to go hand-in-hand. And what potentially could be happening in the future is a more proactive way to genuinely manage and predict these. The industry now has predictability, for example, for reservoir performance, but do they apply the same kind of analytics and predictability in operational safety, in process safety? We know what major incidents or major catastrophes look like in the past. But the ability to pattern match what’s happened before and map it to a set of circumstances in the future to predict and prevent rather than just to find and fix is only now becoming an expected norm.”
“I think it’s probably best summarised by having pioneered the safe system of workspace through 2000 to 2010, it was a very much a first step for a vision of a much broader solution set being around operational risk management. The industry context is actually aligning very well with that, whether it’s the regulators or the Department of Energy and Climate Change in the UK or the Petroleum Safety Authority in the Norwegian sector, the context in the industry is saying that this is a requirement. So the alignment of what our vision was and what the industry is now saying is perfect. But as we saw ePTW as being the start point of a journey, which has moved on, I think where we are right now is just the start the next phase of the journey.”
Article courtesy of Michel Rogers, Editor of Scandinavian Oil Gas Magazine