Process Safety Management

Eindhoven, June 2nd, 2014 dr. ir. M.A. Stam

 Outline Course

• Industrial Processes
• Operations Management
• Commitment to Process Safety
• Understand Hazards and Risks
• Manage Risks
• Learn from Experience
 Day 1

• Welcome + Introduction 09.00-09.15

• Industrial Process: Aluminium Smelting 09.15-10.00
• Coffee Break 10.00-10.30
• Industrial Process: PPTA (Twaron) 10.30-11.15
• Introduction Process Safety Management 11.15-12.00
• Lunch 12.00-13.00
• Operational Excellence 13.00-15.00
• Tea Break 15.00-15.30
• Workshop 15.30-16.30
• Presentations 16.30-17.00
Chemical Park Delfzijl
 Industrial Processes

• Aluminium Production

• PPTA (Twaron) Production

 What is Process Safety Management?

• A System to Help to Prevent Major Incidents

• Essential for Managing Complex Chemical Operations
• Process Safety Focusses:
• Technology
• Facilities
• Personnel

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 Business Case For Process Safety

• Corporate Responsibility
• Business Flexibility
• Risk Reduction
• Sustained Value

“We have seen process safety benefit our

business in ways we had not anticipated.
We need to share this message with
others.”

Arnold Allemang
Vice President, Global Manufacturing
The Dow Chemical Company

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 Corporate Responsibility

• Protects employees and community

• Reduces concerns within the local community
• Engages employees - morale, loyalty, retention
• Protects reputation and shareholder value
• Creates lower risk perception by investors
• Enhances lenders’ confidence
• Increases value of corporate image and brand
• Helps assure insurance coverage at attractive rates
• Helps regulators understand your facility
• Enhance customer and supplier relationships
• Comply with regulations
• Conform to industry standards worldwide

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 Business Flexibility

• Hold a License to Operate

• Good relationships with the local community
• Ability to grow and earn profits
• High performance staff
• Expansion permits or new facilities more quickly
• Good relationships with regulators

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 Risk Reduction

• A Robust Process Safety Program Will Help Your Company

Reduce Risk and Avoid Loss
• Save lives and reduce injuries
• Reduce property damage costs
• Reduce business interruptions
• Protect market share
• Reduce litigation costs
• Reduce regulatory penalties from accidents
• Reduce regulatory attention

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 Sustained Value

• Companies in This Study Reported Significant Direct Cost

Benefits of Up to
• 5% increases in productivity
• 3% reduction in production costs
• 5% reduction in maintenance costs
• 1% reduction in capital budget
• 20% reduction in insurance costs

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 “Increased Productivity”

• Increased process and equipment reliability

• User-friendly, accurate operating procedures
• Improved team effectiveness through employee training
• Employee ownership of the systems
• Enhanced troubleshooting capabilities
• Extended intervals between major turnarounds
• Decreased downtime for major turnarounds and repairs

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 “Production Cost Reduction”

• Improvement in yields
• Lower costs for material rework (quality)
• Lower costs for waste stream disposal
• Prevention of hazards and operability issues
• More efficient staffing requiring less supervision
• Engaged employees participating in continuous improvement

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 “Maintenance Cost Reduction”

• Effective equipment maintenance procedures

• Contractor safety programs
• Repairing or replacing critical equipment before it fails
• Avoiding unplanned shutdowns
• Lower maintenance turnaround costs
• Thorough periodic inspection

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 “Capital Budget Reduction”

• Inherently safer process designs

• Process hazard analyses
• Lower capital expenditures

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 “Insurance Cost Reduction”

• Effective emergency planning and response

• “Near misses” to identify potential problems early
• Incident investigation prevent similar incidents
• Lower casualty insurance premiums

*) Center For Chemical Process Safety, “The Business Case for Process Safety”, 2nd Edition, 2006
 Process Safety Management

• System that Focuses on:

• Prevention of
• Preparedness for
• Mitigation of
• Response to and
• Restoration

• From Catastrophic Releases of Chemicals or Energy from a

Process Associated with a Facility

*) Center For Chemical Process Safety, “Risk Based Process Safety – An Overview”, San Antonio, April 28, 2013
 Process Safety Management

*) Center For Chemical Process Safety, *) Sepeda, L.A., “Understanding Process Safety Management”, American
“Guidelines for Risk Based Process Safety”, Institute of Chemical Engineering, August 2010
2007
 Commit to Process Safety

• Process Safety Culture (2)

• Compliance with Standards (1)
• Process Safety Competency (1)
• Workforce Involvement (2)
• Stakeholder Outreach (1)

*) Center For Chemical Process Safety, “Guidelines for Risk Based Process Safety”, 2007
 Understand Hazards and Risks

• Process Knowledge Management (3)

• Hazard Identification and Risk Analysis (3)

*) Center For Chemical Process Safety, “Guidelines for Risk Based Process Safety”, 2007
 Manage Risks

• Operating Procedures (3)

• Safe Working Practices (2)
• Asset Integrity and Reliability (3)
• Contractor Management (2)
• Training and Performance Assurance (2)
• Management of Change (3)
• Operational Readiness (2)
• Conduct of Operations (1)
• Emergency Management (2)

*) Center For Chemical Process Safety, “Guidelines for Risk Based Process Safety”, 2007
 Learn from Experience

• Incident Investigation (1)

• Measurement and Metrics (1)
• Auditing (1)
• Management Review and Continuous Improvement (2)

*) Center For Chemical Process Safety, “Guidelines for Risk Based Process Safety”, 2007
 Operational Excellence

• System of Profound Knowledge

• Lean Manufacturing
• 6-Sigma
• Process Variation
• Control Objective
• Experimental Design
• Management Systems
 System of Profound Knowledge (Deming)

X1

X2 X4
→ Y
X → Y
X3 X5

t1 t2

*) Deming, W.E., “The Economics.”, 2nd Edition, 1994

 System of Profound Knowledge

• System
• Interdependence
• Steady State
• Knowledge about Variation
• Common Cause versus Special Cause
• Stable and Unstable States Type of Variation Characteristics
Characteristics

• Theory of Knowledge Always Present

Common Cause Expected
• Management is Prediction Predictable
• Knowledge is built on Theory Normal

• Psychology Not Always Present

Special Cause Unexpected
Unpredictable
Not Normal
Has a surprise
element
 “What do you look at?”

?
Material
Men Primary Outputs
Methods Process
Machine

Control
 Lean Manufacturing: Principles

*) Womack, J.P., Jones, D.T., “Lean Thinking”, Free Press, 2003

 Lean Manufacturing: House

Performance and Visual Management

Just in Time 5S
Flow Lay-out Flexibility Stability Jidoka
Kaban Standards
7 Waste Poka Yoke
Continuous Improvement
Lean Manufacturing: 8 Wastes
 Lean Manufacturing: Inventory

Inventory
Motion Waiting
Over
Production

Transport

Extra
“The more inventory a company has, …the
less likely they will have what they
need.”
T. Ohno
Toyota Production System
Flow
Value Stream Mapping (1)
Value Stream Mapping (2)
Example
 Other Tools

Poka-Yoke
“Error proof”

Jidoka
“Stop the line”

“There is no improvement without a

standard.”
T. Ohno Kanban
Toyota Production System
“Correct sequence”
Lean Manufacturing: 5S
Lean Manufacturing: Visual Performance
 “What relations can be defined?”

Example: 10 steps/decisions

Effectiveness per Step Calculation Overall Efficiency

90% 0.90x0.90x…x0.90 34.9%

95% 0.9510 59.9%
99% 0.9910 90.4%
99.5% 0.99510 95.1%
99.9% 0.99910 99.0%

99.9% + 50% 0.9999x0.5 49.6%

99.5% (100 stappen) 0.995100 60.6%

 6-Sigma

Define Measure Analyse Improve Control

•Detailed Plant •Exposing •Diagnosis, using •Daily Audit •Tighten control
Audit to identify variation - Data intensive system: loops, links to
leverage of Process systems, Audits campaigns involve all. Management,
Stability •Primary Metrics •Hypothesis •Configure Automation,
•Euro Benefits •Gap to close •Test for Lean Maintenance
•Resources and Production •Visual systems
Plan

*) Gupta, P., “Six Sigma Business Score Card”, McGraw-Hill, 2004

 Methodology

Charter Data Collection Plan Stratification Map Analysis C&E

Business Case Project Scope Definitions:

– Units
Problem
Milestones
Statement – Defects
Goal Statement Roles – Opportunity
– Process Sigma Root Cause
S Analysis
Data Display Tools
S I P O C
CPM Tree

Process σ
Scatter Plots Regression DOE

Solution Summary Cost/Benefit Analysis Monitoring Standardizing

Pilot
Wk 1 Wk 2 Wk 3 Wk 4 Wk 5 Wk 6 Wk 7 Wk 8 Wk 9 Wk 10 Wk 11 Wk 12

A
B
C
D
E
F
G
H
I Documenting Response Plan
J
 Different Methods
PDCA 7 STEPS “DMAIC”
Plan 1 Charter/Theme Define

S 2 Data Collection Measure

3 Root Cause Analyze

Do 4 Solution Improve
Planning And
Implementation

Check 5 Confirming
Solution Works

6 Standardization Control

Act 7 Reflect Next

Steps
 DMAIC (DMAGIC)

Closing Start
Control and 1 Define problem and goal
sustain by 6
standardisation
Go/no go Go/no go
S
 ?
TIP Q42006
Pareto
Implement 5 2 Measure facts
100%
improvements

M M

No jumping to
Go/no go M M
by Review
solutions!
4 3 Analyse the
Generate facts
improvements
Go/no go
 Process Variation

• What are our processes?

• What are the boundary conditions?
• How do we control our processes?
• What is the reproducibility of our processes?
• What statistical and graphical analyses are used?
• What is the ratio between compensatory and corrective actions?
• What is the connection between these actions?
• …
Gap Analysis (Best Practice)

Process
Performance
SIGMA SIGMA

After Before
Abnormality Detection
 Expert Systems

25 30%

AlF3
20 20%
Al2O3
CUSUM Ratio Al2O3 [%]
Soft Sensors

15 10%
CUSUM AlF3 [kg]

10 0%

5 -10%

0 -20%
1-Feb-06 11-Feb-06 21-Feb-06 3-Mar-06 13-Mar-06 23-Mar-06 2-Apr-06 12-Apr-06
-5 -30%

-10 -40%
Date [m /d]
Root Cause Analysis Techniques
 Control Objective (1)

• Understanding of Underlying Process

• Multivariate Principles
• Root Cause Analysis
• Quality of Decision-Making
• Corrective Control Actions

• Reduction of Process Variability

M.P. Taylor & B.J. Welch, 8th AASTC, 2004
 Control Objective (2)

Data Analysis

Heater
Measurements Action

Explanation
Common Cell for Process Control
Behaviour Variation Actions Window open
and heater on

Data (Control) Decision-

information Making
 Experimental Design in Aluminium Industry

• Traditional Methods
• Trial on a Group of Cells

• Before-After-Control-Impact (BACI) Method

• Trial Group
• Start Test on t=t0
• Evaluation of Results after t=tend

• Trial Group vs. Reference Group

• Incorporation of Global Variations

*) S. Rutledge, “Statistical Methods for Use in the Aluminium Smelting Industry”, Light Metals, 2008, pp. 325-327
 Experimental Design

• What is the Research Question?

• Understanding of the Problem → Hypothesis → Theory
• What is the Best Experimental Set-Up for Testing?
• Testing without Pre-Warning
• Maximum Commitment of Operators
• How Representative are Tests on a Group of Cells?
• Limited Number of Cells
• Boundary Conditions (e.g. Location in Potline, Pot Life, …)
• Statistics
• How can we Quantify the Effectiveness of the Trials?
• Leading and Lagging Indicators
 Management Systems

A management system describes the set of procedures an

organization needs to follow in order to meet its objectives.

OH&S Management System Model

*) www.iso.org
Swimlanes
 Organizational Structure

Site Manager

Human
QHSE Controlling Production Technology Maintenance
Resource
 Workshop – Define Ambition

• “Industrial Processes and Operational Excellence”

• 5 Groups
• 1 Representative, 5 Minutes Presentation, Less than 50 Words

• Develop an Ambition for “ProPac”

• High raw material and energy costs
• Increased costs
• Reduced margins
• Capital intensive
• Knowledgeable, but aging work force Ambition is the desire
• Semi-manufactured products for personal
achievement.
• Increased regulatory pressure