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03/02/2006, 07/26/2010, and 05/19/2015. To the average person, these dates mean birthdays, anniversaries, birth and deaths. But to the petroleum industry, these are considered some of the costliest failures of quality management in recent petroleum history.
Prudhoe Bay, Alaska (March 2, 2006): Because of lack of maintenance, cracks in a pipeline spilled 843,000 gallons of petroleum, devastated pristine landscapes, killed wildlife and made people sick.
Final cost: $500 million.
Kalamazoo River, Michigan (July 26, 2010): Lack of maintenance caused a pipeline rupture that spilled 267,000 gallons of petroleum spilled into the Kalamazoo River.
Final cost: $800 million
Refugio, California (May 19, 2015): The decision not to install a simple shutoff valve caused the decimation of local wildlife, contaminated beaches and will continue to affect ocean life for many years to come.
Final cost: Yet to be determined
As you know, there are many other incidents within the industry where the question of adequate detection and mitigation could have reduced the impact of the incident. In fact, at a very basic level and according to the API Spec Q2 standard, your risk assessment and management should “control risk throughout the execution of a service.” In order to maintain compliance, your procedure should:
In short, managing risk requires proactive and preventive measures to protect your organization’s and customer’s interests. Detection and mitigation of risk potential should be at the core of your total risk assessment strategy.
For more information on how Accupoint’s solutions can help you manage your risk assessment process, visit www.accupointsoftware.com or call us at 800.563.6250.
Prudhoe Bay, Alaska (March 2, 2006): Because of lack of maintenance, cracks in a pipeline spilled 843,000 gallons of petroleum, devastated pristine landscapes, killed wildlife and made people sick.
Final cost: $500 million.
Kalamazoo River, Michigan (July 26, 2010): Lack of maintenance caused a pipeline rupture that spilled 267,000 gallons of petroleum spilled into the Kalamazoo River.
Final cost: $800 million
Refugio, California (May 19, 2015): The decision not to install a simple shutoff valve caused the decimation of local wildlife, contaminated beaches and will continue to affect ocean life for many years to come.
Final cost: Yet to be determined
As you know, there are many other incidents within the industry where the question of adequate detection and mitigation could have reduced the impact of the incident. In fact, at a very basic level and according to the API Spec Q2 standard, your risk assessment and management should “control risk throughout the execution of a service.” In order to maintain compliance, your procedure should:
- Identify risks (potential or real) associated with services and service-related products;
- Identify and use risk management tools and techniques;
- Select, communicate and implement the mitigation or preventive control measures to reduce or avoid exposure to loss; and
- Notify the customer of remaining risks that may impact the service.
In short, managing risk requires proactive and preventive measures to protect your organization’s and customer’s interests. Detection and mitigation of risk potential should be at the core of your total risk assessment strategy.
For more information on how Accupoint’s solutions can help you manage your risk assessment process, visit www.accupointsoftware.com or call us at 800.563.6250.
