EXCHANGING EXPERTISE SINCE 1893

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1 Pipeline Safety Management Systems: Transforming Gas Utilities April 20, 2017 Operations Conference Natural Gas Pipeline SMS Robert Miller and Jeff Wiese

2 Pipeline SMS: Transforming Gas Utilities The history and background of RP1173 and why this transformation is so critical for all operators to develop and implement.

3 Remarks Outline» My Charge: national perspective on genesis, development, strategic implementation, and steps being taken by trades and others to assist with implementation (more in Session 4)» Robert: delves into more detail about RP 1173» Summary» Recent history: where are we now, and how the heck did we get here 2010: A year from Hell Convergence of opinion that current approaches aren t working Digging our way out Committing to Zero as our shared goal Looking at other High Hazard Industries for lessons learned Development of API s RP 1173 and steps taken to advance it s adoption 3

4 Summary» Our world has changed forever, and there s no going back Energy pipelines have graduated to the national stage, many times for the wrong reasons (eg, hydrocarbon wars) Growing public intolerance to risk yet also highly rate sensitive Vastly increased media attention / new media business model Social media (without editorial control) Pipelines have become a Cause Celebre» We cannot fail to reduce both the real threat and the perceived threat» We must act with intentionality to aggressively investigate the health of our pipeline systems, analyzing and understanding data and information, and promptly act to mitigate risks AND we must systematically commit to learning and continuous improvement» API RP 1173 gives us the framework to do this; good news many of you are doing many of the things it requires. This is a great time to commit to conform your company s efforts business-like WOO» Pipeline SMS is a journey, and not a check the box exercise need to get going

5 Recent History»About two significant accidents per day, resulting in 14 fatalities and 16 serious injuries each year (most recent 10 year averages) mostly LDC»Particularly serious pipeline accidents in 2010 and 2011 investigated by NTSB revealed management system weaknesses as major contributing factors. The NTSB Marshall, MI incident report stated: Evidence from this accident and from the San Bruno accident indicates that company oversight of pipeline control center management and operator performance was deficient. NTSB recommended that a Pipeline Safety Management System would improve performance through top management leadership. API assembled a diverse group of industry, government, and public stakeholders to build the PSMS over the course of two years When completed NTSB issued an exceeds expectations review of API RP 1173, saying it set a new standard for high hazard industries All major trade associations and regulators are advocating conformance to RP 1173, and most are actively trying to help. For a start see:

6 NTSB s Recommendation to API» Promoting SMS adoption in transportation systems by elevating SMSs to its Most Wanted List.» SMS s continuously identify, address, and monitor threats to the safety of company operations by doing the following: Proactively address safety issues before they become incidents/accidents Document safety procedures and requiring strict adherence to procedures by safety personnel Treat operator errors as system deficiencies and not as reasons to punish and intimidate operators Require senior company management to commit to operational safety Identify personnel responsible for safety initiatives and oversight Implement a nonpunitive method for employees to report safety hazards Continuously identify and address risks in all safety-critical aspects of operations Provide safety assurance by regularly evaluating (or auditing) operations to identify and address risks 6

7 The Path to Zero: Commitment, Continuous Improvement, and Culture 7

8 Participants in the Development PSMS» Ron McClain, Kinder Morgan Energy Partners, Chair» Mark Hereth, P-PIC, Content Editor» Scott Collier, Buckeye Partners» Tom Jensen, Explorer Pipeline» Paul Eberth, Enbridge Pipelines» Brianne Metzger-Doran, Spectra Energy» Tracey Scott, Alliance Pipeline» William Moody, Southwest Gas» Nick Stavropoulos, Pacific Gas and Electric» Steve Prue, Small Gas Distribution» John Bresland, Public Subject Matter Expert» Stacey Gerard, Public Subject Matter Expert Edmund Baniak, API (Standards Support) Robert Miller, AZ Corporation Commission Massoud Tahamtani, VA State Corporation Commission Bob Beaton, NTSB (Ex Officio) Kate Miller, AGA John Ericson APGA Scott Currier, INGAA Peter Lidiak, API 4 Liquids Pipelines 4 Natural Gas Pipelines 1 City Distribution 3 Trade Organizations 4 Regulators 2-PHMSA 2-NAPSR 1 NTSB 3 Public SME s 1 Contract Engineering 1 Standards Organization» Jeff Wiese, PHMSA» Linda Daugherty, PHMSA (alternate)

9 SMS Elements 1. Leadership and Management Commitment 2. Stakeholder Engagement 3. Risk Management 4. Operational Controls 5. Incident Investigation, Evaluation, and Lessons Learned 6. Safety Assurance 7. Management Review and Continuous Improvement 8. Emergency Preparedness and Response 9. Competence, Awareness, and Training 10. Documentation and Record Keeping

10 SMS Elements 1. Leadership and Management Commitment» Top Management Establish measurable goals and objectives Accountable for continuous improvement Review performance and communications Asses the safety culture Management Assure effective process, procedures and training to meet objectives Assess, evaluate, and adjust as needed to meet objectives Foster continued improvement Employees Follow management s process and procedures to meet objectives Identify improvement Reveal risks

11 SMS Elements» 2. Stakeholder Engagement» Internal focus Assure full employee engagement and learning» External focus Move from awareness to dialogue to help reduce risk and share safety performance» Identify and resolve concerns about transparency on safety matters both internally and externally.

12 SMS Elements 3. Risk Management Build upon the fundamentals of risk management Know your system AND the environment around it to recognize potential threats and consequences Start with emphasis on data and data quality Identify risks What Can Go Wrong? Take actions to mitigate risks Perform periodic analyses at least once annually Report to Top Management on risk analysis, mitigation methods and effectiveness

13 SMS Elements 4. Operational Controls Operating Procedures Reviewed annually for lessons learned Safe Work Practices Address situations where stop work and procedural deviations are encouraged for safety System Integrity Management of Change Use of Contractors

14 SMS Elements» 5. Incident Investigation, Evaluation and Lessons Learned» The pipeline operator shall maintain a detailed procedure for investigating incidents and near misses that led, or could have led, to a loss of life or serious injury. Identify the cause, contributing factors and lessons Evaluate the emergency response Develop recommendations for improvement Update risk assessment plan Communicate the investigation findings Internally and Externally Track corrective and preventative actions Learn from past events

15 SMS Elements» 6. Safety Assurance» The pipeline operator shall demonstrate the proper application of its SMS and progress toward effective risk management and improved pipeline safety performance through the following sub-elements: Audit Evaluation Employee Reporting and Feedback Analysis of Data Performance Evaluation Evaluation of Safety Culture Evaluation of Maturity

16 Safety Culture» The collective set of attitudes, values, norms, and beliefs that the operator s employees and contractor personnel share with respect to risk and safety: It Is The Glue Documentati on and Record Keeping Leadership and Management Commitment Stakeholder Engagement Competence, Awareness, and Training Risk Management Safety Culture Glue Emergency Preparednes s and Response Operational Controls Management Review and Continuous Improvemen t Safety Assurance Incident Investigatio n, Evaluation, and Lessons Learned

17 SMS Elements» 7. Management Review and Continuous Improvement. Management review ensures the connection with Top Management Continuous improvement is an important theme Review performance at least annually by Top Management Shows how effective and the opportunities to continuously improve Evaluate and use technology for improvements

18 SMS Elements 8. Emergency Preparedness & Response Releases Weather events Security threats Fires Utility losses impacting operations Pandemics Civil disturbances Review O&M plans when new threats are identified as a results of an accident

19 SMS Elements» What else must be considered?» Lessons learned to improve the process What worked and what didn t? How do lessons from drills and actual response feed into plans and procedures?» Periodic review and updating of the plan» We need to know who our partners in response are and communicate with them before an emergency.

20 SMS Elements» What should plans/procedures include? Internal and external notification requirements Identification of response resources and interfaces Recognition and use of Unified Command/Incident Command Structure Safety, health, and environmental protection processes Communication plan Training and drills, including involvement of external agencies and organizations

21 SMS Elements» 9. Competence, Awareness and Training Assure competence at every level for all personnel. Employees Contractors Sub contractors Management Communicate responsibilities and authority for each member. Create confidence and proactive positive culture.

22 SMS Elements» 10. Documentation and Record Keeping Data Data and communication drive the PSMS High quality and current Data is the basis for decision making and should be readily available across the entire organization Documentation Provides the dual purpose of setting expectations and recording results Includes Policy, Objectives, Methods, etc.

23 Safety Management Systems» SMS requires: Intentional and systematic actions Diligence and oversight Involvement at all levels COMMUNICATION» The Rewards of a properly implemented SMS are: Enhanced pipeline safety Increased process efficiencies Increased system reliability Reduced costs

24 Things People Commonly Ask» Is this just another flavor of the day and will I be forced to do this (by regulators or others)? Most regulators adopting a watchful waiting approach, and some are experimenting collaboratively In a few cases serious infractions may lead to stronger encouragement» We are relatively small. Will this apply to all operators? Pipeline SMS is VERY scalable PSMS will bring a regular, formal structure and strategic approach to safety, and a good gap analysis may well show that you are already doing many of the elements of a fully-developed PSMS Those new to SMS will benefit from learning how formally to measure, track and improve their safety performance» Why do we have to think about all that soft, cultural stuff? Culture eats strategy for breakfast any day It s the oil in your SMS engine 24

25 Thank You Let s Talk About It! Any and All Questions Welcomed

26 Contact Information Robert Miller / Veriforce ( robert.miller@veriforce.com / Jeff Wiese / TRC Solutions ( jwiese@trcsolutions.com /

27 Pipeline Safety Management Systems: Transforming Gas Utilities April 20, 2017 Operations Conference Natural Gas Pipeline SMS Robert Miller and Jeff Wiese