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HAZARD IDENTIFICATION, RISK

ASSESSMENT AND CONTROL MEASURES


FOR MAJOR HAZARD FACILITIES

BOOKLET 4

Hazard identification, risk assessment and


control measures for Major Hazard Facilities Booklet 4

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TABLE OF CONTENTS
1 Who is this booklet for?..............................................................................................3
2 What does the booklet aim to do?..............................................................................3
3 Hazard identification, risk assessment and control measures introduction............3
4 Hazard identification..................................................................................................3
4.1

The importance of getting the hazard identification right..................................4

4.2

Features of HAZID...........................................................................................5

4.3

Hazard identification processes and techniques................................................8

4.4

Review, revision and typical problems............................................................14

5 Risk assessment.........................................................................................................16
5.1

Risk assessment aims......................................................................................16

5.2

Examples of risk assessment methods.............................................................23

6 Control measures......................................................................................................32
6.1

Introduction.....................................................................................................32

6.2

What is a control measure?.............................................................................32

6.3

Understanding control measures.....................................................................34

6.4

Selecting and rejecting control measures........................................................38

6.5

Additional or alternative control measures......................................................39

6.6

Defining performance indicators for control measures....................................41

6.7

Critical operating parameters..........................................................................44

6.8

Involving employees in control measures.......................................................45

6.9

Control measures within the safety report and SMS........................................45

6.10

Reviewing and revising control measures.......................................................46

6.11

SMS - A suggested combination of key elements............................................47

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Who is this booklet for?


This booklet has been produced for employers in control of a facility that
has been classified by Comcare as a major hazard facility under Part 9 of the
Occupational Health and Safety (Safety Standards) Regulations 1994.

What does the booklet aim to do?


This booklet provides guidance on key principles and issues to be taken into
account when conducting an effective hazard identification and risk
assessment at a major hazard facility (MHF) that is subject to
Commonwealth legislation. It also describes the type and nature of control
measures that the employer in control of an MHF should consider. These
processes should be consistent with the safety management system.
This booklet is a guide to the intent of the Regulations but employers in
control of an MHF should refer to the Regulations for specific requirements.
In addition, this booklet refers to hazard identification and risk assessment
techniques that may be appropriate for MHF purposes (and described in the
facility SMS refer to Booklet 3) but these may not be the only techniques
in use at a facility, other techniques include job safety analysis and task
analysis.

Hazard identification, risk assessment and


control measures introduction
Hazard identification (HAZID) and risk assessment involves a critical
sequence of information gathering and the application of a decision-making
process. These assist in discovering what could possibly cause a major
accident (hazard identification), how likely it is that a major accident would
occur and the potential consequences (risk assessment) and what options
there are for preventing and mitigating a major accident (control measures).
These activities should also assist in improving operations and productivity
and reduce the occurrence of incidents and near misses.
There are many different techniques for carrying out hazard identification
and risk assessment at an MHF. The techniques vary in complexity and
should match the circumstances of the MHF. Collaboration between
management and staff is fundamental to achieving effective and efficient
hazard identification and risk assessment processes.

Hazard identification
The Regulations require the employer, in consultation with employees, to
identify:

4.1

a)

all reasonably foreseeable hazards at the MHF that may


cause a major accident; and

b)

the kinds of major accidents that may occur at the MHF, the
likelihood of a major accident occurring and the likely consequences of
a major accident.

The importance of getting the hazard identification


right

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Major accidents by their nature are rare events, which may be beyond the
experience of many employers. These accidents tend to be low frequency,
high consequence events as illustrated in Figure 1 below. However, the
circumstances or conditions that could lead to a major accident may already
be present, and the risks of such incidents should be proactively identified
and managed.

Figure 1: HAZID focus on rare events

HAZID must address potentially rare events and situations to ensure the full
range of major accidents and their causes. To achieve this, employers
should:
a)
b)
c)
d)

identify and challenge assumptions and existing norms of


design and operation to test whether they may contain weaknesses;
think beyond the immediate experience at the specific MHF;
recognise that existing controls and procedures cannot
always be guaranteed to work as expected; and
learn lessons from similar organisations and businesses.

Some significant challenges in carrying out an effective HAZID are:


a)

substantial time is needed to identify all hazards and potential


major accidents and to understand the complex circumstances that
typify major accidents;

b)

the need for a combination of expertise in HAZID


techniques, knowledge of the facility and systematic tools;

c)

the possibility that a combination of different HAZID


techniques may be needed, depending on the nature of the facility to
ensure that the full range of factors (e.g. human and engineering) is
properly considered;

d)

obtaining information on HAZID from a range of sources


and opinions; and

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e)

ensuring objectivity during the HAZID process.

Comcare must be satisfied that hazard identification has been


comprehensive and the risks are eliminated or controlled before granting a
licence or certificate of compliance to operate an MHF.

4.2

Features of HAZID
Comcares expectations and some important features of
HAZID
Comcare will expect:
a)

a clear method statement or description of the HAZID


process, defining when it was conducted, how it was planned and
prepared, who was involved and what tools and resources were
employed;

b)

that the HAZID process was based on a comprehensive and


accurate description of the facility, including all necessary diagrams,
process information, existing conditions and modifications; and

c)

that the overall HAZID process did not rely solely on data
that was historical or reactive and that employers ensured that
predictive methods were also used.

The HAZID process must identify hazards that could cause a potential
major accident for the full range of operational modes, including normal
operations, start-up, shutdown, and also potential upset, emergency or
abnormal conditions. Employers should also reassess their HAZID
whenever a significant change in operations has occurred or a new
substance has been introduced. They should also consider incidents, which
have occurred elsewhere at similar facilities including within the same
industry and in other industries. Refer to the guidance material for Safety
Safety Report and Report Outline guidance material (booklet 4) for the
definition of significant change.

Involving the right people


An effective HAZID process is dependent upon having the right people
participating in the process. The employer should:
a)

involve Health and Safety Representatives (HSRs) in


selecting staff to participate in HAZID;

b)

involve HSRs in determining if the HAZID techniques are


suitable for the staff selected;

c)

ensure participants understand the relevant HAZID methods


so that they can fully participate in the process; and

d)

be alert for hazards that can be revealed by the combination


of knowledge from specialists in different work groups.

Features of a HAZID process


The following aims to demonstrate the main features of a HAZID.
Although the HAZID process chosen by employers must suit the
circumstances of the MHF, the features noted below are generally applicable
to all processes.
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Preparation: Prior to commencement of the HAZID, the following steps


should be completed:
a) Agreement on the purpose and scope of the HAZID;
b) Appropriate personnel and HAZID tools identified;
c) Sufficient resources and time allocated;
d) Clearly defined reporting processes and study boundaries according to
the purpose and scope;
e) Appropriate background information and studies collated, such as
historical incident data;
f)

An agreed interpretation of major accident that is consistent with the


Regulations and relevant to the facility.

System description: At the commencement of the HAZID, the complete


system of assets, materials, human activities and process operations within
the boundaries of the study should be clearly defined and understood, taking
account of the original design, subsequent changes and current conditions.
Typically, the system should be divided into distinct separate components or
sections to enable manageable quantities of information to be handled at
each stage.
Systematic evaluation and recording: The HAZID should move
progressively through the system, applying the HAZID tools to each
component or section in turn. All identified hazards and incidents should be
recorded in some way. (See Figure 16 in this booklet for some examples of
how hazard registers may be configured.) A checklist of guidewords,
questions or issues should be considered at each stage.
Some key questions and issues could be:
a)

What is the design intent, what are the broad ranges of


activities to be conducted, what is the condition of equipment, and what
limitations apply to activities and operations?

b)

What are the critical operating parameters? What process


operations occur, and how could they deviate from the design intent or
critical operating parameters? This should consider routine and
abnormal operations, start-up, shutdown and process upsets.

c)

What materials are present? Are they a potential source of


major accidents in their own right? Could they cause an accident
involving another material? Could two or more materials interact with
each other to create additional hazards?

d)

What operations, construction or maintenance activities


occur that could cause or contribute towards hazards or accidents? How
could these activities go wrong? Could other hazardous activities be
introduced into this section by error or by work in neighbouring
sections of the facility?

e)

Could other materials, not normally or not intended to be


present, be introduced into the process?

f)

What equipment within the section could fail or be impacted


by internal or external hazardous events? What are the possible events?

g)

What could happen in this section to create additional


hazards, e.g. temporary storage or road tankers?

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h)

Could a particular section of the facility interact with other


sections (e.g. adjacent equipment, an upstream or downstream process,
or something sharing a service) in such a way as to cause an accident?

Past, present and future hazards


To identify all hazards, the HAZID will need to consider past, present and
future conditions, hazards and potential incidents. Past incidents, at the
MHF or similar facilities, provide an indication of what has gone wrong in
the past and what could go wrong in the future.
A wide range of hazards and potential incidents will be present in the
facility. New hazards and incidents could be created in the future as a result
of planned or unplanned changes. The management of change process
described in the SMS should identify new conditions during the planning of
modifications or new activities. This should then trigger further HAZID
studies and risk assessments, with the identification of control measures as
appropriate. Figure 2 below illustrates the range of tools that can be used to
identify past, present and future hazards.

Figure 2: Past, present and future hazards

4.3

Hazard identification processes and techniques


HAZID techniques

The flowchart below summarises all the steps needed in a HAZID process
and how those steps relate to one another.

Figure 3: HAZID process

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Examples of HAZID Techniques


HAZOP
Hazard and Operability Study (HAZOP) is a highly structured and detailed
technique, developed primarily for application to chemical process systems.
A HAZOP can generate a comprehensive understanding of the possible
deviations from design intent that may occur. However, HAZOP is less
suitable for identification of hazards not related to process operations, such
as mechanical integrity failures, procedural errors, or external events.
HAZOP also tends to identify hazards specific to the section being assessed,
while hazards related to the interactions between different sections may not
be identified. Therefore, HAZOP may need to be combined with other
hazard identification methods, or a modified form of HAZOP used, to
overcome these limitations.

Equipment failure case definition


This method is a systematic approach to defining loss of containment events
for all equipment within the study boundary. Process flow and equipment
diagrams are studied systematically, and all equipment is assigned
appropriate loss of containment scenarios, such as pinhole leaks, according
to design, construction and operation. This form of hazard identification
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may be necessary for many major hazard facilities, to avoid missing


potential scenarios, but is not sufficient on its own because it does not
consider specific causes or circumstances. Therefore, this technique should
only be used in combination with other techniques for MHF purposes.

Checklists
There are many established hazard checklists which can be used to guide the
identification of hazards. Checklists offer straightforward and effective ways
of ensuring that basic types of events are considered. Checklists may not be
sufficient on their own, as they may not cover all types of hazards,
particularly facility-specific hazards, and could also suppress lateral
thinking. Again, this technique should only be used in combination with
other techniques for MHF purposes.

What-If Techniques
This is typically a combination of the above techniques, often using a
prepared set of what-if questions on potential deviations and upsets in the
facility. This approach is broader but less detailed than HAZOP.

Brainstorming
Brainstorming is typically an unstructured or partially structured group
process, which can be effective at identifying obscure hazards that may be
overlooked by the more systematic methods.

Task Analysis
This is a technique developed to address human factors, procedural errors
and man-machine interface issues. This type of hazard identification is
useful for identifying potential problems relating to procedural failures,
human resources, human errors, fault recognition, alarm response, etc.
Task Analysis can be applied to specific jobs such as lifting operations,
moving equipment off-line or to specific working environments such as
control rooms. Task Analysis is particularly useful for looking at areas of a
facility where there is a low fault-tolerance, or where human error can easily
take a plant out of its safe operating envelope.

Failure Modes Effects Analysis (FMEA)


FMEA is a process for hazard identification where all conceivable failure
modes of components or features of a system are considered in turn and
undesired outcomes are analysed. This technique is quite specialised and
may require expert assistance.

Failure Modes Effects and Criticality Analysis (FMECA)


FMECA is a highly structured technique that is usually applied to a complex
item of mechanical or electrical equipment. The overall system is described
as a set of sub-systems and each of these as a set of smaller sub-systems
down to component level. Individual system, sub-system and component
failures are systematically analysed to identify their causes (which are
failures at the next lower-level system), and to determine their possible
outcomes, which are potential causes of failure in the next higher-level
system. This technique is quite specialised and usually requires expert
assistance.

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Fault Tree and Event Tree Analysis


Fault Trees describe loss of containment events in terms of the combinations
of underlying failures that can cause them, such as a control system upset
combined with failure of alarm or shutdown and relief systems. Event trees
describe the possible outcomes of a hazardous event, in terms of the failure
or success of control measures such as isolation and fire-fighting systems.
Fault tree and event tree analysis is time-consuming, and it may not be
practicable to use these methods for more than a small number of incidents.

Historical records of incidents


Databases of incidents and near misses that have occurred are a useful
reference because they give a very clear indication of how incidents can
occur. Employers should consider site history, company history, industry
history and possibly even wider sources of historical information for this
purpose.

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Examples of major accidents and the role of multiple factors


in those accidents
Texas City, USA, 2005. An explosion at a large refinery killed 15 workers
and injured over 170 others. Equipment upgrades and SMS elements
including process safety information, communications and training were
targeted for improvements following the incident. Total cost of plant
upgrade reported to be 1 billion dollars over 5 years.
Longford, Victoria, 1998. Two workers were killed and eight others
injured in an explosion at a gas processing plant. As a result, many elements
of the SMS were targeted for improvements including process safety
information and communication of critical safety information.
Pasadena, USA, 1989. A fire and a series of explosions at a refinery
complex resulted in 23 fatalities. Inadequate and unofficial isolation
procedures, together with human error induced by poor ergonomics played a
role in causing the accident. The loss of life and scale of damage were
increased due to poor plant layout and subsequent damage to fire-fighting
systems.
Piper Alpha, UK, 1988. The accident was triggered by a small leak in a
condensate pump system, which by itself would most likely have had only
minor consequences. However, in combination with failures in management
systems, design and equipment, the event resulted in the loss of 167 lives
and destruction of the entire platform.
Bhopal, India, 1984. Half a million people were exposed and over 20,000
have died to date as a result of a release of methyl-isocyanate via a vent
stack. A range of systems and equipment had been malfunctioning or were
taken out of service over a period leading up to the disaster, including a
safety system for scrubbing tank vent releases, but this was disabled because
the plant was shut down and not considered to be a risk. After the plants
construction, a large shanty town had grown up around it, but this had not
led to any recognition of changes in risk.
Flixborough, UK, 1974. A modification was made to a bypass for one of a
series of reactor vessels. Due to the urgency of the work, and the fact that
there had been significant organisational change, the modification was
designed and constructed inadequately. The bypass failed, releasing a large
cloud of cyclohexane, which exploded and killed 28 persons. Not only was
the new hazard not considered during the modification, it was not
recognised during subsequent operations even though the bypass was seen
to move as process pressure rose and fell.

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Human factors and the nature of hazards an overview


Human factors are defined as the interactions between people and the
organisation, systems and equipment they interface with. Consideration of
the effect of human factors on risk is sometimes defined as fitting the work
to the employees or the science and practice of designing systems to fit
people. The subject of human factors is concerned with understanding the
capacities and limitations of people in their jobs, and using this
understanding to eliminate or control the effects of human weaknesses and
exploit human strengths. In this context, human weaknesses may include
limitations on information processing capabilities, while human strengths
may include adaptability.
Some facilities may find that human factors are a major contributor to the
nature of hazards at the facility. It is expected that in this case there will be
thorough evaluation of the causes of this. Analysis of human errors may
require procedural reviews or human factors analysis.
From the major hazard control perspective, the role of people is critical to
the safe operation of major hazard facilities and should be addressed in the
safety report. Accordingly, employers should incorporate human factors
into relevant aspects of the operation of major hazard facilities, including
the SMS, hazard identification, risk assessment, control measures, the safety
role of employees and contractors, emergency planning and training.

Human factor HAZID techniques


When identifying human factor hazards, the employer should examine the
foreseeable major accidents and consider how human factors may contribute
to or cause those accidents. It is important employees with experience in the
specific area being studied participate to identify the hazards that may be
present.
This should involve identifying the ways in which just being human can
influence the performance of individual tasks and roles. For example, a
person may operate a wrong valve by mistake, or may inadvertently use the
incorrect procedure. Examples of being human include: memory
limitations, visual acuity limitations, information processing problems,
distraction, fatigue, decision-making biased by experience and knowledge,
rigid problem solving, susceptibility to following group behaviour. These
can all adversely influence human actions and decisions leading to the
possible creation of hazards.
It is important to acknowledge that human factors can introduce hazards at
all levels, from performing individual operations and maintenance tasks,
through to designing the facilities, writing the procedures and even setting
standards and policy for the organisation. Human factor hazards can also be
latent hazards, in that they will not be revealed until particular
circumstances combine to make them obvious. For example, the transfer of
a key operational supervisor into a non-operational project role may lead to
a deficiency of knowledge within the operations team; this deficiency may
not become apparent until an emergency occurs. Accordingly, while it is
necessary to involve first-line operations and maintenance personnel in the
hazard identification, it is also necessary to consider wider issues than the
day-to-day roles and activities of these persons.
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When considering the type and level of human factors input that is needed
in hazard identification, employers should consider their specific
circumstances, and in particular, the amount of reliance they place on human
actions and decisions in the prevention and control of major accidents.
Cases where detailed consideration of human factors might be appropriate
include a process plant that requires employee action to prevent or control
emergency situations or a dangerous goods warehouse that relies heavily on
procedural controls to ensure correct segregation of goods.
In addition to calling upon the necessary range of operations personnel to
take part in the hazard identification, it may also be appropriate to use
persons having specialist human factors knowledge. This specialist
knowledge may be essential if human factors hazards can influence critical
safety controls.
Human factor HAZID techniques are evolving and are based on methods
developed from engineering HAZID methods. They follow the same
principles and can be conducted in conjunction with an engineering HAZID.

Task analysis
An important set of human factors techniques, which can be used in all
areas of human factors consideration, is a set of methods collectively called
task analysis. Task analysis is not only used in HAZID but is also a tool
for risk assessment and development of control measures to accommodate
human factors.
Task analysis is used to study what a person, or team, is required to do, in
terms of actions and/or mental processes to achieve a system goal. The
information used in and derived from a task analysis will depend on the
technique used and the objective of the analysis.

Examples of task analysis techniques include:

Task simulation

Questionnaires and structured


interviews
Link analysis

Work safety analysis

Hierarchical Task Analysis (HTA)

Event/fault tree analysis

Timeline analysis

Human Factors HAZOP

HTA is one of the most commonly used task analysis techniques. It is used
to systematically analyse a task or series of tasks. The outcomes of the HTA
will depend on the reasons for its use. For example, if a new control room
is being designed for a process facility, the design layout and equipment
available in the control room should be tested to ensure that it is appropriate
for handling all foreseeable operations (start-up, normal, abnormal). If HTA
is used to assess workload, the information, processing and time
requirements of the task, or tasks, should be tested.

4.4

Review, revision and typical problems

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Review and revision of hazard identification


The Regulations require that the safety report must be reviewed in particular
circumstances and reviewing the HAZID is part of this requirement.
Consequently, the overall HAZID process should include regular and proactive reviews to identify any new hazards and to refresh knowledge of
existing hazards. The HAZID process should include a range of triggers for
individual HAZID studies. These triggers may be a scheduled program of
reviews or could arise from information gathered during regular safety
meetings.

Use of the HAZID results


The value of a high-quality HAZID, and the major commitment of resources
required, demand effective use of the HAZID. However, the cost of a major
accident will be far more significant than that for the process that could
prevent it.
The hazard register should facilitate the process of revisiting and updating
the knowledge of hazards and incidents within the facility. The register
should communicate clear linkages between the employers processes for
hazard identification, risk assessment and the selection or rejection of
control measures.

Lateral thinking and realism in HAZID


History clearly shows that major accidents often arise from a set of complex
conditions or coincidental events, which may include multiple failures in
both equipment and procedures. The initial conditions that lead to these
major accidents might have been relatively minor problems, but they
developed into major accidents because other problems arose concurrently.
Companies and individuals can exhibit corporate blindness when
identifying or reporting hazards by assuming that the systems and
procedures in place only ever function as intended. It is possible that other
safeguards or pure luck will prevent a major accident from occurring, but
the employer should consider the possibility that several events may at some
time combine to cause a serious incident. These situations arise in reality,
and should be allowed for in HAZID.

Use of worst-case scenario in HAZID


Employers should include all foreseeable hazards in the HAZID and
transparently analyse each event within the risk assessment. The employer
should consider all possibilities, on a case-by-case basis, and document any
assumptions regarding the definition of worst case. The employer should
then be in a position to define the worst-case scenario for the facility. By
using risk assessment techniques employers should be in a position to
identify worst-case scenarios.
Definitions of what constitutes the worst-case scenario can be difficult to
assess. The worst-case scenario is sometimes incorrectly deemed to be the
largest event within the capacity of the on-site protection systems, simply on
the basis that any event worse than this cannot be planned for.
However, such events are merely the worst that has been allowed for during
design and are not necessarily the worst that can occur. Most examples of
major accidents given above clearly exceeded the design basis, which is
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why they resulted in such serious outcomes. Both the design events and
the true worst case events are required to be considered.
It should also be recognised that the worst case in terms of the distance of
impact might not be the worst case in terms of potential consequences. It
may be necessary to consider both these consequences. The worst-case
scenario for one area of a facility may not be the same as that for another
area of the same facility. This will depend on a large number of factors such
as materials normally or not normally present, extreme process conditions,
isolation systems that may fail, the proximity and the layout of vessels and
the presence of personnel. Employers should consider all available
information, including historical incident records, in deriving the worst-case
scenario.

Common mistakes in HAZID


A common mistake in hazard identification is to screen out or discard some
incidents because they are perceived to be extremely unlikely or of low
consequence. Incidents may be unlikely or of low consequence only as a
result of the control measures in place. However, a key purpose of the
HAZID and risk assessment process is to identify critical control measures
and to determine their effectiveness. Therefore, it would be self-defeating to
disregard incidents because control measures are in place. All potential
major accidents should be recorded during the HAZID. Any screening,
analysis and assessment of the hazards, their consequences or the
effectiveness of the controls, should occur during the risk assessment. In
practice, the HAZID and risk assessment processes are often combined into
one workshop (or similar) which makes this distinction difficult. This
ensures transparency and the ability to audit the entire process. This is
necessary for the justification of the adequacy of control measures.

Other potential pitfalls that should be avoided include:


a) being too generic in identification of hazards and potential major
accidents;
b) limiting the hazard identification to the immediate cause of potential
major accidents, without determining the fundamental underlying
cause;
c) attempting to conduct the risk assessment and assessment of control
measures during the hazard identification. Except for very simple
facilities, it is almost certainly better to separate hazard identification
from the subsequent stages; this helps ensure a systematic HAZID
process. However, in practice, the HAZID and risk assessment are
often combined so that the risk assessors are aware of the hazards
identified and any other information discussed during the HAZID;
d) widening the scope to include too great a range of incident types, such
as all occupational health and safety issues. If these issues must be
considered they should only be the issues relevant to controlling the risk
of a major accident;
e) carrying out the HAZID with incomplete or inaccurate facility
descriptive information;
f)

proceeding with the study without first having developed, agreed and
planned the approach and the method of recording. A pilot study on a

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selected area of the facility, may be beneficial in deciding on an


effective HAZID approach;
g) failing to be comprehensive and systematic with respect to the
activities, operations and possible different states of each part of the
facility;
h) failing to record important information discussed during the HAZID,
e.g. assumptions, uncertainties or debated issues and gaps in
knowledge;
i)

allowing the hazard identification workshops to be dominated by


individual persons or groups within the organisation; and

j)

where HAZIDs are conducted across several sessions - failing to review


previous session findings or remind participants of the scope and
objectives.

Risk assessment

5.1

Risk assessment aims


The aims of risk assessment are to:
a) provide a basis for identifying, evaluating, defining and justifying the
selection of control measures for eliminating or reducing risk, and to
therefore lay the foundations for demonstrating the adequacy of the
standards of safety proposed for the facility;
b) provide the employer and employees with sufficient objective
knowledge, awareness and understanding of the risks of major
accidents at the facility;
c) capture knowledge of risk of a major accident at the facility so it can be
managed, disseminated and maintained. The management of knowledge
generated in the risk assessment will also greatly assist the efficient
development of a safety report for the facility, for example by handling
assumptions and actions arising; and
d) provide practical effect to the employer's safety report philosophy. For
example, if the employer intends to base the safety report largely on the
facilitys compliance with specific codes or standards, the risk
assessment should address corresponding issues such as the basis of the
codes and standards and their applicability to the facility.

Creating and transferring knowledge using risk


assessment
Understanding the risks of major accidents may be accompanied by
uncertainty, but the risk assessment will be successful if it reduces this
uncertainty to an acceptable or tolerable level. The results of risk
assessment must be captured and disseminated to those who require the
knowledge, to enable the uncertainty of the entire organisation to be reduced
to an acceptable level.
An effective risk assessment should involve the processes of debating,
analysing, sharing views and generating information and knowledge on the
risk of major accidents and their means of control. It should include the
active participation of employees or contractors who influence safe
operations. This is the definitive criterion for participation of employees and
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contractors. Formal roles or assumptions about someones role are


irrelevant to producing a high quality risk assessment.
There are no limits to the activity or sources that can be used to understand
the facility and its risks. For example, it could incorporate information from
incident investigations, discussions during safety meetings about hazards
and ways of controlling them, condition monitoring programs, analysis of
process behaviour, evaluation of process trends or deviations from critical
operating parameters, procedure reviews or flood or weather records.
Risk assessment results are a useful input to training needs analyses. For
example, if a procedure or task carried out by employees is an important
control measure that can fail if there is inadequate employee knowledge,
then the risk assessment should identify that risk and the need for that
knowledge. It can then be a tool to assist in imparting that knowledge to
employees, either by direct involvement in their defined roles or as a source
of information to develop instruction or training sessions.
The above example illustrates the importance of knowledge management in
the process of complying with the Regulations: the HAZID and risk
assessment generate knowledge, and this knowledge should be captured and
implemented via the safety management system and the processes of
consulting, informing, instructing and training. It must be recognised
however, that assessing safety is not the same as managing safety, and risk
assessment is only worthwhile if it informs and improves the decisionmaking and implementation processes. Reducing uncertainty should balance
the improvement in the effectiveness of decisions against the cost of
additional assessment.
The SMS should instigate risk assessments to maintain a comprehensive and
up-to-date understanding of risk as the facility changes. Risk assessment
may be triggered via the management of change process at the facility. The
results of risk assessments would be expected to feed into the development
of the SMS.

Identifying and evaluating control measures using risk


assessment
The risk assessment should consider a range of control measures and
provide a basis for the selection of control measures. Risk assessment can
be a useful tool, which can save or optimise the use of resources, by
determining the effectiveness and costs of different control options,
improving the decision-making process and providing a basis for allocating
resources in the most effective manner. The risk assessment process should
provide the following in relation to control measures:
a) identification or clarification of existing and potential control measure
options;
b) evaluation of effects of control measures on risk levels;
c) basis for selection or rejection of control measures and the associated
justification of adequacy; and
d) basis for defining performance indicators for selected control measures.
The range of control measures that should be considered in the risk
assessment is addressed later in this guidance material. The risk assessment
should evaluate the range of control measures in terms of viability and
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effectiveness to provide a basis for selection or rejection of each control


measure:
a) Viability relates to the practicability of implementing the control
measure within the facility; and
b) Effectiveness relates to the effect of the control measure on the level of
risk. For example, the reliability and availability of control measures
influence the likelihood of an incident occurring, while the functionality
and survivability of the control measures during the incident influence
the consequences.
Specific studies may be carried out as part of the risk assessment to evaluate
these issues for individual or groups of control measures.
By evaluating options for control measures within the risk assessment the
employer should be able to determine what additional benefit is gained from
introducing additional or alternative control measures. If these do not result
in any reduction in risk, the basis for rejection is apparent. The employer
should look for gaps in the existing control regime, where the introduction
of further control measures may be necessary.

Using the risk assessment to set performance indicators


The risk assessment should generate information useful to the setting of
performance indicators for the adopted control measures. For example:
a) matching performance indicators with the control measures control
measures with more rigorous performance standards are more likely to
be associated with the high consequence hazards than the lower
consequence hazards;
b) control measure functionality, including reliability, reflecting the scale
of incidents being controlled;
c) reliability, or number of control measures, reflecting the likelihood of
the corresponding incidents.

Overall framework and principles for risk assessment


There are fundamental questions most forms of risk assessment attempt to
address to ensure the risk assessment is comprehensive and systematic (see
Figure 4).

Figure 4: Basic questions within risk assessment

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The risk assessment should use assessment methods (quantitative or


qualitative or both) that suit the hazards being considered. This means that
the tools employed must be selected according to the nature of the risk. A
tool that does not address any variability or uncertainty in the nature of the
hazards and incidents identified can fail to generate the necessary
understanding and provide no basis for differentiating between control
measures.
There is no single tool able to meet all the requirements for risk assessment,
and all tools have limitations and weaknesses. For example:
If the dominant contributor to a major accident relates to aging of equipment
and associated mechanical integrity problems, then an analysis of
mechanical integrity, corrosion rates, breakdown data, reliability and
inspection/testing/maintenance issues may be necessary to develop the
required understanding. In such a case, a quantitative risk assessment
(QRA), which is usually based on generic data, may not provide the
necessary information or lead to effective solutions.
Similarly, if a facility employer has identified human error as a key risk
driver, then a Task Analysis, Human Reliability Analysis, or detailed
analysis of the operating procedures may be appropriate. Analysis of
equipment condition and reliability in this case would probably not be
effective.
For many facilities, there may be several types of assessment required. In
the interests of efficiency, it is desirable to clearly identify the types of
detailed study required, before following any particular route. Two basic
tools can assist this process, they are preliminary/qualitative risk
assessments and hazard or risk ranking. There are plenty of examples of
both types of tool, but they all have a common purpose - to determine the
nature of the risk in terms of the basic causes, likelihood, consequences and
controls.
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Where it is clear that the employer has insufficient knowledge of causes or


likelihood, detailed studies may be needed. A preliminary evaluation should
point towards the types of detailed study required. An appropriate ranking
methodology allows the key areas to be identified and prioritised. It enables
the employer to determine if the gaps in knowledge correspond to what may
be major risk contributors.
Priority should be given to those areas where it is obvious there is likely to
be a high risk and there are also gaps in knowledge about the things giving
rise to the risk. Some iteration may be required where the ranking of key
areas is revisited following detailed assessment, to see if any hazards have
increased in rank and now require more detailed study. Figure 5 aims to
illustrate the relationship of preliminary evaluation, ranking and detailed
studies.
Figure 5: Relationship between preliminary evaluations, ranking and
detailed studies

The above discussion introduces the concept of a "tiered approach" that is


frequently used in risk assessment. If a simple technique generates the
information required by the Regulations and also generates sufficient
understanding of the risk and the options for its control, further risk
assessment may not be necessary. However, if substantial uncertainty
remains, or the employer wishes to look at a range of options in greater
detail, then further effort is justified and more detailed tools may be
desirable. In general, greater assessment effort should result in a more
quantitative, accurate and robust understanding, thereby allowing a more
transparent and rational basis for decision-making.
The key to the tiered approach is that, at each stage, the employer should
compare the potential cost of increasing the detail of the assessment against
the benefit that further assessment may give. In this context, the benefit
may be a higher level of knowledge of the hazards and the risk, or may be a
better understanding of the optimum means of controlling the risk
(described in Figure 6).

Figure 6: Tiered Approach to Risk Assessment

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Some facilities may use a semi-quantitative risk assessment where


qualitative brainstorming sessions of staff are combined with quantitative
studies and information. If data and knowledge have been collected
previously about the MHF and remain relevant to risk assessments under the
MHF Regulations, it is acceptable to make use of that data and knowledge.

Cumulative assessment of hazards in the risk assessment


The risk assessment must consider hazards cumulatively and individually.
The effects of several hazards occurring in combination must be considered.
Many major accidents have been caused by the realisation of a number of
hazards concurrently. For any accident there may be several independent
hazards or combinations of hazards, each of which could lead to that
accident, and several control measures which may be particularly critical
because they may influence one or more of those hazards. The risk
assessment should give an understanding of the total likelihood of each
accident and the relative importance of each separate hazard and control
measure.
The potential for escalation of major accidents, and the consequences of this
which may be greater than an event in isolation, need to be considered along
with the consequences and their effects (e.g. number of injuries, extent of
property damage).
A facility may have a range of major hazards that could lead to potential
major accidents. Both the highest risk incidents and the overall profile of
risks from all incidents must be determined, so that the risk can be shown to
be adequately controlled. In cases where a large number of different
hazards and potential accidents exist, the cumulative risk may be significant
even if the risk arising from each event is low.

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The "bow tie" diagram (Figure 7) is similar to a combined fault and event
tree that shows how a range of causes, controls and consequences can be
linked together and associated with each major accident scenario.
Cumulative consideration of the hazards can be seen as the overall
evaluation of interactions between different parts of a single bow tie or
consideration of a range of bow ties together.
Cumulative consideration of hazards enables the employer to assess the
overall risk picture for the facility and to understand how different causes
and events can combine to lead to an accident. It also enables the key causes
and controls for the risks to be identified and evaluated in more detail if
required.

Figure 7: Examples of bow tie diagram

Uncertainty and assumptions in risk assessment


Handling uncertainties and assumptions in risk assessment is a difficult
issue, but necessary. A complete and accurate understanding of the risk of
major accidents is unlikely. Uncertainty cannot be eliminated and it will be
necessary to make assumptions in some areas. The key is to record and test
assumptions wherever possible and to explicitly recognise where the main
gaps or uncertainties exist.
Where important assumptions are made (e.g. assuming a control measure
has a high level of effectiveness), the employer should ensure these
assumptions are consistent throughout the safety report, and are
implemented, tested and confirmed in practice.
Employers should consider using sensitivity analysis to test the robustness
of the risk assessment results against variations within the key areas of
uncertainty. This may involve changing key assumptions and determining if
the changes in results would affect any decisions that have been made based
on those results. Where sensitivity analysis or consideration of the gaps in
knowledge indicates a significant level of uncertainty or poor confidence in
the resulting decisions, further detailed assessment may be required.

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Is quantitative risk assessment required?


QRA is only one tool within the risk assessment toolkit. It involves
calculation of the frequency and consequence of a range of hazardous events
and numeric combination of these to estimate the risk in a numerical format
to allow direct comparison of results, including a measurement of risk to
nearby neighbours and society as a whole.
However, it is not a requirement of the Regulations that a QRA is
performed. The methods used must be appropriate to the hazards, the nature
of the options available, the facility safety philosophy and the decisions that
are required from the risk assessment. A decision not to perform QRA does
not preclude the employer from carrying out specific quantitative
calculations regarding frequencies, consequences or other aspects of the
risk.
If QRA assists understanding of the risks and the appropriateness of control
measure options, then it should be considered as a tool to support the risk
assessment. However, QRA may not provide all the answers and is typically
best suited to differentiating design, layout, location and engineering
options. QRA is generally considered to be most useful for quantifying offsite risk; however, it can be useful in assessing on-site risk if sufficient
detail and an understanding of the reality of peoples response to accidents
are included.

5.2

Examples of risk assessment methods


To recap, risk assessment must involve an investigation and analysis of the
identified hazards and major accidents, so as to provide an understanding
(and documentation) of the:
a) nature of each hazard and major accident
b) likelihood of each hazard causing a major accident
c) magnitude of each major accident
d) severity of consequences of each major accident to persons on-site and
off-site
e) range of control measures available to control each major accident
f)

effectiveness and viability of control measures for each major accident

g) individual and cumulative effects of hazards


Each of these aspects is discussed below, with examples to illustrate the
concepts, together with discussion of simplified, overall, preliminary
qualitative methods of risk assessment, that may be used to focus the detail
of the assessment onto the high-risk cases.
This section is not intended to be a detailed or comprehensive description of
risk assessment methods. The methods and figures shown below are purely
selective examples to illustrate the approaches and are not a
recommendation for any specific application.

Preliminary or qualitative risk assessment


The most common form of preliminary or qualitative risk assessment is a
risk matrix, which assesses individual incidents in terms of categories,
e.g. low, medium and high, according to their expected consequence and
likelihood. An example of the risk matrix approach is provided in Australian
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Standard AS4360 (Risk Management). Risk matrices may need to be


tailored to the requirements of the MHF Regulations as they are not
typically designed for very low frequency events. Risk nomograms provide
an alternative approach; although it is little used in practice (see Figures 8 &
9).
These methods can provide a relatively rapid understanding of the risk
profile of the facility and can be based on judgment or be refined using
more detailed information. However, the understanding gained will be
relatively coarse, and the methods have limitations. For example, it is not
easy to incorporate the effects of risk reduction measures within the risk
matrix, and neither method is easy to use to assess cumulative hazards, in
particular at facilities where a large number of hazards exist. To assess such
issues, methods that are more detailed are likely to be required.
When using risk matrices or nomograms it is important to define individual
incidents or scenarios on a consistent basis so that comparable events are
assessed. For example, a risk matrix could be used to evaluate specific
outcomes of incidents or individual incidents or a specific cause of an
incident. The likelihoods and consequences would be defined very
differently depending on which definition of incident is used. Hence, the
employer should decide how incidents will be defined and use the same
approach for all incidents. A balance must be struck between defining events
in sufficient detail and defining too many events to manage in the
assessment.

Figure 8: Example of a risk matrix

Figure 9: Example of a risk nomogram

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Ranking methods
Most forms of preliminary risk assessment can be used as a basis for
ranking different incidents to establish their approximate order of
importance. In the risk matrix example, a simple scoring system can be
introduced to represent the combined effect of likelihood and consequence.
For example, the highest-ranking incident is m.a.7 (i.e. major accident
number 7) with a score or risk index of 16, closely followed by m.a.12 with
a risk index of 15. The sum of the risk indices for all incidents is 76;
therefore, the contribution of incident m.a.7 is 16/76 or about 21% of the
cumulative risk. Note that the risk index on the matrix is a multiplication of
the numbers assigned to the rows and columns NOT an addition.
An extension of the above scoring approach is to define a range of specific
factors that affect the likelihood or consequences of each incident. For each
factor, each incident may be given a score such as from 1 to 5 or a simple
rating such as low, medium or high based on specific, established criteria.
The scores for each incident are then added to give an overall likelihood,
consequence or risk score for each incident.

Investigating and analysing the nature of hazards and


major accidents
A range of different techniques is available for investigating and analysing
the nature of hazards and major accidents. The MHF Regulations do not
prescribe a specific method; therefore, it is the employers responsibility to
determine the most appropriate for the circumstances of the particular MHF.
To assess the nature of hazards and potential major accidents requires
knowledge of what may go wrong within the facility if measures to
eliminate or prevent accidents are not present. Depending on the different
types of hazards and potential outcomes, the employer may need to employ
a combination of techniques to develop a complete understanding.
Techniques, which may have been used for identifying hazards and
accidents, can sometimes also be used in the risk assessment to assist in
understanding the nature, consequences and likelihood of the hazards and
their control. For example, while HAZOP is primarily a tool for hazard
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identification, the HAZOP process can also include assessment of the causes
of accidents, their likelihood and the consequences that may arise, so as to
decide if the risk is acceptable, unacceptable or requires further study.
However, within the scope of a combined HAZID and risk assessment
workshop, this assessment would necessarily be coarse, qualitative and
subjective and would in many cases need to be supplemented by more
detailed assessment outside the workshop.
A HAZOP would not necessarily be the appropriate technique for detailed
analysis of the causes of some other types of accidents (e.g. failures within
complex electrical or mechanical equipment). In such cases, a failure mode
effects and criticality analysis (FMECA) may be more useful and
supplemented by whatever mechanical integrity information already exists
for the systems within the facilitys maintenance and breakdown records.1
Alternatively, a Fault Tree Analysis may provide the necessary
understanding of the nature and causes of different types of hazard.2 In
many cases, an FMEA may be used to identify what can go wrong, and how
low-level failures may affect higher-level systems.3 A Fault Tree may then
be used to show how low-level failures, combined with external aspects
such as loss of power supply or human error may combine to cause overall
system failure. The Fault Tree can also be used, in principle, to estimate the
likelihood or frequency of the failure occurring.

Figure 10: Example of a Fault Tree

Investigating and analysing the likelihood of hazards


causing major accidents
Likelihood analysis is a complex and potentially difficult process. The range
of values in this process varies from may occur within a plant lifetime,
through to extremely rare or never known within industry. Likelihood
is highly dependent on a range of site-specific factors such as the number of

See under the heading Examples of HAZID techniques in section 6.6 of this booklet for a brief
explanation of an FMECA.
2

Also see the reference above for a brief explanation of a fault tree and event tree analysis.

Also see the reference above for a brief explanation of an FMEA.

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equipment items, its condition, activity frequencies, the quality of the


management system and human error levels.
Likelihood analysis should consist of a mixture of qualitative and
quantitative information that, overall, gives an indication of likelihood of
each incident. This may be based on calculations of basic task frequencies,
analysis of how often errors are made, the reliability of safety devices,
previous incident history or near miss data for the facility or industry sector.
If historical data is used, it should be critically assessed and the sources of
such information documented. If simple judgment or other techniques are
used, the employer must record the assumptions and logic used to determine
likelihoods.
Likelihood analysis flows directly from the preceding process of assessing
the nature of hazards and accidents. Further evaluation of information
generated in these processes may be carried out to derive an understanding
of likelihood. For example, Fault Trees can be used to produce a qualitative
or quantitative understanding of the likelihood of different hazards and how
they may combine to lead to a specific accident.
Event Trees may be used to determine what alternative outcomes may arise
from an initial event, and the relative likelihood of each outcome. Again, it
is possible to develop qualitative or quantitative event trees. Event trees also
assist in defining the significant consequence scenarios, which need to be
evaluated in detail.
Both Event Trees and Fault Trees can be used to evaluate quantitatively or
qualitatively what effect existing or potential control measures have on risk
levels. The effects of control measures assumed in these assessments should
be reflected in the performance indicators defined for the control measures.

Figure 11: Example of an Event Tree

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Human factors and likelihood


Human factors can have a major effect on the likelihood of breakdowns,
hazards or overall incidents. It is very difficult to fully quantify the effects
of human factors on likelihood; however there is some robust general
information on human error rates that may be utilised in risk assessment.

Investigating and analysing the magnitude and severity


of accidents
The magnitude and severity of accidents can be determined using
consequence and impact analysis. Consequence analysis involves
calculation of the size and duration of the physical and or chemical effects
of accidents, while impact analysis involves determination of the harm done
to people and property.
There are complex computer packages available for consequence analysis,
but also simple equations and nomogram techniques for some cases such as
the radiation from pool fires or the toxic gas cloud formation from releases
of chlorine. Typical consequences which need to be considered within a risk
assessment are toxic exposure from gas clouds or smoke inside or outside
buildings. The selective use of worst-case consequence modelling can
improve the efficiency of a process when it is necessary to identify which
areas of the facility can cause offsite effects.
It is necessary to also consider less than worst-case conditions to develop a
comprehensive understanding of the risk. The Regulations apply equally to
onsite and offsite populations, and the worst-case scenarios for onsite and
offsite populations may be very different.
The worst-case approach involves defining the credible combination of
conditions giving rise to the maximum consequence zone for the identified
accident, in relation to the target population. This can include defining
release quantity, duration, pressure, composition, location, wind speed and
other atmospheric conditions, time of ignition and functioning of control
measures.
It is common to assume the worst-case release quantity is the maximum
vessel contents, released over a defined period of time. However it should
be noted that this cannot be assumed to be the correct assumption for all
types of plant or storage area. Where there is a clear mechanism for
releasing more than the maximum vessel inventory, this should be
considered in the consequence analysis.
Active control systems such as isolation valves and blowdown systems need
to be assessed for worst-case scenario. Passive control measures that are
assured of functioning in the event of the worst-case accident may be
included in the assessment.
The impact distance in all directions from the release point should be
determined allowing for the fact that the wind can blow from any direction.
The impact distance is usually determined to a predefined consequence
criterion which can be material and/or effect specific.
For example, LPG flash fires will occur to a defined lower flammable limit
while LPG can also produce fireballs or jet fires that can cause injury or
damage from thermal radiation effects. Thermal radiation criteria are the

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same for all flammable materials. Employers should carefully define all
relevant consequence criteria based on their definition of a major accident.
Below is an example of one method for illustrating the consequences and
effects of a major accident. The example is a major accident involving a
pool fire. This method may prove helpful during the risk assessment
process and, if used, should be included in risk assessment documentation.

Figure 12: Pool fire consequences & effects

The employer should consider consequences under a range of


meteorological conditions. Usually the worst-case meteorological condition
for toxic or non-dense gas releases is high atmospheric stability and a low
wind speed, typically experienced at night-time or in the very early
morning. For dense gases, the worst-case condition is typically a high wind
speed, which tends to occur at neutral atmospheric stability and during the
day. Definitions of stability and other environmental conditions can be
found in safety or meteorology literature.
Ambient temperature and humidity may also affect the consequences of
releases. In particular, high temperature can increase the flammable effect
range of low volatility materials. Surface type and topography can also
affect the consequence, such as a spill into water or onto sloping areas.

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For flammable materials the consequences should be analysed both when


ignition occurs immediately following the release, and if ignition occurs
after sufficient delay for a flammable cloud to fully develop. Further factors
to consider include day versus night conditions, extreme weather conditions
such as flooding, storms and including cyclones for facilities located in
cyclone-prone areas of Australia.
To evaluate the impacts of major accidents on people, it is necessary to
consider the number and distribution of potentially exposed people, and
their characteristics. Variations in these factors should also be considered
such as temporary populations, maintenance crews and on-site populations
for specific operational modes. A further factor that should be considered is
that people such as emergency services or investigators may be present
specifically because there is a developing incident.

Presentation of risk assessment results


Risk assessment results can be presented in many different ways (see the
example below). Again it is important to provide the results showing
explicitly which control measures are reflected in each result.

Figure 13: Example risk assessment results

Key achievements for a quality risk assessment

The risk assessment is conducted for all hazards and potential major
accidents at a facility, ensuring that:
a) it is comprehensive, systematic, rigorous and transparent;
b) it generates all information required by the Regulations, and provides
employers with sufficient knowledge to operate safely;
c) the knowledge is kept up to date, through review and revision;
d) the information is provided to persons who require it to work safely;
e) an appropriate group of employees is actively involved;
f)

uncertainties are explicitly identified and reduced to an acceptable


level;

g) all methods, results, assumptions and data reflect the nature of the
hazards considered and are documented;
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h) a range of control measures are considered and their effects on risk are
explicitly addressed;
i)

it supports the development of the safety management system;

j)

it is used as a basis for adoption of control measures, including


emergency planning; and

k) it is used as a basis for the demonstrations in the safety report.

Control measures

6.1

Introduction
The previous sections discussed key elements for the range of control
measures that should be in place at an MHF. This section provides more
detailed guidance on how to select and judge the effectiveness of specific
control measures. Choosing the best control measures and being able to
demonstrate their effectiveness is a critical feature of compliance with the
Regulations.

6.2

What is a control measure?


A control measure is the part of a facility, including any system, procedure,
process or device that is intended to eliminate hazards, prevent hazardous
incidents from occurring or reduce the severity of consequences of any
incident that does occur.
It is the principal tool that delivers safe operation. Control measures are not
only physical equipment; they may include high-level procedures or detailed
operating instructions and information systems. Control measures may be
proactive, in that they eliminate, prevent or reduce the likelihood of
incidents, or they may be reactive, in that they reduce the consequences of
incidents. They must be implemented under and fully supported by the
managerial elements of the SMS.
The employer should identify control measures carefully for the MHF, to
avoid unnecessary effort or confusion via assessing measures that are not
relevant to major accidents. Understanding what part is a control measure,
and how it actually controls or affects hazards and risks, is critical to safe
operation. This understanding is also essential to the safety report and the
associated justification of adequacy of the adopted control measures.
Control measures can be regarded as the barriers between the hazards of
an MHF, the occurrence of a major accident as a result of these hazards, and
ultimately the harm that may be caused to people, property and the
environment in the event of a major accident. This concept is illustrated in
Figure 14.

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Figure 14: Control measures as barriers to major accidents

con
seq
uen
ces

Control measures can be identified while identifying hazards and during the
risk assessment. Employers should be able to identify a range of control
measures immediately, both the existing measures and possible alternatives.
Checklists of "typical" control measures may be able to assist in the process,
but these should not be used in isolation. The specific nature of each hazard
and the associated part of the facility should be considered when identifying
control measures. The table below is an example of the consequences and
key control measures that might apply for a warehouse.
An example: Identification of scenarios and control measures,
dangerous goods warehouse
Scenarios
Flash or pool fires from
puncturing drums containing
flammable liquids.
Fires in packaged goods
areas, in pallet storage stacks,
or amongst general rubbish.
Fire escalation.

6.3

Key Controls
Drum inspection and handling
procedures
Ignition source control
Fire fighting equipment
Housekeeping
Ignition source control
Smoke detection and automatic
vents
Separation and segregation rules
Stacking restrictions
Fire fighting equipment and
emergency response

Understanding control measures

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Each identified control measure should be clearly linked to the causes,


hazards, major accidents or outcomes they are designed to control.
Employers should understand the nature, scale and range of hazards and
outcomes each control measure must deal with and the effects each control
measure has on these factors. This understanding is required to cover the
whole range of conditions that might exist at the facility.
This knowledge provides a clear basis for defining which control measures
are critical to safe operation. It also provides a basis for defining
performance indicators and standards for control measures.

Using a risk control hierarchy to determine control


measures
In an occupational health and safety context, risk control is often
categorised according to an effectiveness hierarchy; often simply called the
risk control hierarchy. The hierarchy lists the type of control measures in
a priority order, based on the extent each measure has an impact on risk.
In the context of MHFs, a useful effectiveness hierarchy of control measures
is as follows:
a) eliminate hazards;
b) prevent incidents;
c) reduce consequences; and
d) mitigate the harm.
The different categories are defined below.
The control "hierarchy" in an MHF context:
Control measures that eliminate a hazard are clearly the most effective. If
practicable they should be selected in preference to any other type, as their
existence removes the need for other controls.
Control measures for prevention are those intended to remove certain
causes of incidents or reduce their likelihood. The corresponding hazard
remains, but the frequency of incidents involving the hazard is lowered.
Control measures for reduction are those intended to reduce the severity
(consequences) of incidents. They include reduction of inventory.
Control measures for mitigation are those that take effect in response to an
incident to limit the consequences. They may include fire-fighting systems
and, in particular, the emergency response plan. While they may be the "last
line of defence", they remain necessary if risk cannot be reduced to a
negligible level by other means.
Control measures can also be categorised as hardware (i.e. engineered
systems) or software (e.g. management systems or operating /maintenance
procedures). Controls may also be grouped into categories that define the
nature and spread of the control such as engineering, organisational,
procedural and administrative controls. Whatever method of categorisation
is employed, safe operation will depend on an appropriate balance of
different types of control measures.

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These categorisations can help in determining the most effective control


measures for a facility and in ensuring a range of measures is chosen so that
one failure does not remove many controls.
A single category of control measure will rarely be enough for a risk to be
controlled as far as is reasonably practicable unless the elimination of the
hazard has occurred. Most commonly, layers of protection will be required
to reduce a risk so far as is reasonably practicable.
For most facilities or items of equipment, there are numerous layers acting
as barriers to eliminate, prevent, reduce or mitigate incidents. This is
illustrated in Figure 15. Equipment integrity, operating and maintenance
procedures are the "inner layers", and are the barriers normally relied on to
ensure incidents do not occur. Systems that reduce or mitigate incidents are
the "outer layers" which are relied on in abnormal or emergency conditions.
A robust risk control regime will feature a range of risk control layers; the
number and integrity of which should reflect the inherent level of hazard
and risk within the protected part of the facility.

Figure 15: Layers of Protection


COMMUNITY EMERGENCY RESPONSE
PLANT EMERGENCY RESPONSE
PHYSICAL PROTECTION &
MITIGATION SYSTEMS
AUTOMATIC SAFETY
INSTRUMENT SYSTEM
CRITICAL ALARMS AND
OPERATING PROCEDURES
BASIC
PROCESS
CONTROL SYSTEM
PROCESS
DESIGN

Examples of control measures are shown below, using the above


categorisation. The table is illustrative only, and is not intended to be a
complete list of possible controls for any facility. The categorisation shown
is not intended to be rigid, and many controls may apply in more than one
category.

Some examples of control measures


Type

Engineering Controls

Administrative Controls

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Elimination

Prevention

Mounding of LPG storage


tanks.

Inherently safe process


concept.

Substitution with nonhazardous materials.

Feedstock quality
specifications.

Inherent design features,


layout.

Plant design procedures.

Impact and dropped object Operating procedures and


barriers.
instructions.
Isolation valves to enable
safe maintenance work.

Maintenance and isolation


procedures.

Mechanical ventilation
systems.

Management of change.

Process Control systems.


Corrosion and erosion
probes.
Materials specifications,
corrosion allowance.
Reduction

Physical barriers between


incompatible materials.

Spill containment and


clean-up procedures.

Secondary containment of
hazardous substances.

Ignition suppression
equipment.

Process emergency
controls and alarms.

Procedures.

Shutdown, isolation and


de-pressurisation systems.
Bursting disks.
Safety and relief valves.
Bunds, other containment
and drainage systems.
Mitigation

Fire detection systems.

Emergency alarms.

Fire suppression and


cooling systems.

Emergency planning and


procedures.

Passive fire protection


systems.

Employer-owned buffer
zones.

Control measures may vary for different stages of the facility's life cycle.
For example, design and construction standards are important for new
facilities, but as the facility ages more emphasis may be required on asset
integrity management. Similarly, control measures may themselves have life
cycles that may need to be considered.
The balance and type of control measures are expected to be consistent with
the employers overall safety philosophy. If the safety philosophy is based
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primarily on engineering controls there is less need for other controls such
as administrative ones. On the other hand, if the safety philosophy is based
on personnel knowledge and skills, then procedural and competency
controls might be dominant, although there would need to be additional
hardware controls.
The assessment required to understand control measures, their function and
their effects on hazards and associated risks, is driven by three factors:
a) a highly complex reaction process, new technology, or complex process
equipment may require detailed assessment to understand the control
measures, whereas a simple system can be understood more rapidly and
without using sophisticated methods of assessment;
b) where there are numerous options available to control the associated
risk, more effort is likely to be required to reach an understanding of the
available controls, to differentiate the options in terms of their effects
on risk and to provide a basis for selecting or rejecting options
appropriately; and
c) a high level of uncertainty regarding the nature of the hazard or risk or
the behaviour of the control measures is likely to require greater effort
to reach an overall understanding; e.g. Class 6.1 liquids are more
straightforward to analyse than Class 2.3 toxic gases.
The above concepts illustrate the issues that need to be considered in
defining and understanding control measures. There may be many other
issues that need to be considered in developing an understanding of control
measures for a facility. For many facilities this may result in a significant
amount of information. Therefore a simple method of linking and
communicating the information together should be considered, for example
"bow tie" diagrams or registers of hazards and controls. Figure 16
provides examples of how to use bow tie diagrams or registers to link and
communicate control measure information. Alternatively, simple hazard
management tables or diagrams can be developed.

Figure 16: Examples of presentation formats for hazard and


control information
a) "Bow Tie" diagram

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b) Register of hazards and controls

6.4

Selecting and rejecting control measures


There are several factors to consider when selecting or rejecting control
measures. These factors have a bearing on the fundamentally important
requirement to:
a) justify the adequacy of control measures (where adequacy means
adequate to eliminate risk or reduce it so far as practicable);
b) identify potential common mode failures; and
c) define performance indicators for the control measures.
The text below sets out a series of core questions that the employer may
consider using when selecting or rejecting control measures:

Core questions to ask when selecting or rejecting control measures


Are there controls clearly linked to each hazard, or are there some
hazards having no (or insufficient) control measures? Does the number of
controls reflect the level of severity of the hazards? The extent of
demonstration should be proportional to the level of risk.

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What is the functionality of a control measure against the relevant hazards?


Is it sufficient to control the hazard in the intended manner, i.e. is it fit for
purpose, will it suppress the hazard completely, prevent escalation or simply
mitigate effects?
What is the survivability of the control measure in an accident? Is the
control measure able to function as intended during the types of accidents it
is intended to reduce or mitigate?
Is the reliability of individual control measures, and of all control measures
in combination, appropriate to the level of risk presented by the associated
hazards? Is function testing sufficiently frequent to detect failures, and will
failures once detected be rectified sufficiently promptly?
Has the hierarchy of control measures been considered, with measures to
eliminate the hazard adopted first if practicable, followed by measures to
prevent, reduce and mitigate?
Is there a balance of different types of control measure for each hazard,
i.e. is there a diversity of control measures? Are the control measures
associated with individual hazards independent of each other, or can they all
be disabled by the same mechanism?
Are the control measures maintainable? For example, are they accessible,
can they be maintained (i.e. safety valve with no means for
removal/maintenance as it is the only one and must remain in service)?
Are new control measures compatible with the facility, and any other
control measures already in use?
Can the control measures be implemented at the facility considering their
availability and cost?

6.5

Additional or alternative control measures.


Employers should objectively challenge how safety is achieved and consider
ways to improve safety. This means that alternative control measures not
currently in place must be considered alongside existing control measures,
and either adopted or rejected according to the results of the risk assessment.
In particular, additional controls should be considered if the risk is not
reduced as far as practicable or hazards have been identified with no control
measures in place. Alternative controls should be identified where the risk
is not reduced as far as practicable.
The importance of being prepared to challenge the "norms" of facility
operation has been highlighted in past disaster inquiries such as the
Longford Royal Commission and the Cullen Inquiry into Piper Alpha.
Therefore the employer should typically consider the following
circumstances:
a) existing control measures which are believed to be fully functional and
appropriate;
b) existing control measures which may have become disabled, degraded
or deficient;
c) existing control measures which function as intended but could be
improved;

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d) control measures which were considered or used in the past and rejected
for some reason;
e) existing control measures which are to be replaced due to obsolescence
or old age;
f) new control measures which could replace or add to the existing range
of control measures; and
g) new control measures for modifications to the facility.
For many existing facilities, there may be control measures that were
adopted or rejected in the past without records to support those decisions.
Employers should identify past decisions and control measures that need to
be recorded and reviewed, to understand what was done in the past and why
it was done, and to maintain the integrity of existing control measures in the
future.
This relates to the need for a knowledge base of the control measures on the
facility and is an important part of justifying the adequacy of an existing
facility in the safety report. Given the potentially large number of decisions
and control measures for a typical MHF, which may have decades of
operating experience, the employer will need to identify the critical areas
that require review, and determine which areas need to be reviewed in brief
or in detail.
Circumstances where control measures would require review include:
a) new operating conditions have arisen;
b) knowledge of the basis for safe operation has been lost;
c) there may have been a degradation in effectiveness of existing controls;
d) the knowledge or technology employed is now outdated; and
e) an incident occurred.
The employer should identify both proven technology and newly developed
options, as appropriate and not dismiss any option on the grounds that it is
"unproven". The process of risk assessment should include the evaluation
of new technologies and practices to determine if they are appropriate to the
facility.
A reasonable number of existing and alternative control measures should
therefore be considered, depending on:
a) the scale and complexity of the facility;
b) the nature of the risk profile; and
c) the rate of development of new technologies and practices.

6.6

Defining performance indicators for control measures


Performance indicators for control measures will generally relate to some
standards or target levels of performance (performance standards) to ensure
safe operation. Performance indicators and the corresponding standards play
a vital role in the justification of the adequacy of control measures.
A performance indicator is defined as information that is used to measure
the effectiveness of a control, e.g. a test of effectiveness, an indicator of
failure, an action taken to report a failure or a corrective action taken in the
event of a failure. An indicator is an objective measure, which shows current
and/or past performance.

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A performance standard is defined as the target set for a performance


indicator. The standard represents the required performance for the
control/SMS (whatever) to be considered effective in managing the risk to
ALARP.
Once the employer has decided which control measures are to be adopted,
performance indicators must be defined for the control measures, which
enable the employer to:
a) measure, monitor or test the effectiveness or failure of each control
measure; and
b) determine the best reporting and corrective actions to be taken in the
event of failure.
Performance indicators should measure not only how well the control
measures can perform, but also how well the management system is
monitoring and maintaining them. This shows how performance indicators
for control measures overlap with the performance standards required for
the SMS.
Some performance indicators and their corresponding performance
standards for engineered control measures may be adopted from
manufacturer's recommendations; however, the employer should determine
if these are appropriate to the specific conditions of the facility.
Performance indicators take many forms, and can be quantitatively or
qualitatively expressed. One type of target is a desirable long-term goal or a
limit, the breaching of which can be tolerated to a certain extent or under
certain conditions in the short-term. Another type of target is one that needs
to be achieved within a prescribed timeframe, or where there is zero
tolerance for any breaches.

An example of performance indicators for control measures:


A hardware control measure has performance standards relating to its
capacity and reliability, plus management system standards for inspection,
testing and maintenance, which aim to assure that the capacity and
reliability of the control measure are maintained. Performance indicators
need to be set that measure performance against these standards.
For example, for a pressure relief valve the performance indicators and
standards may relate to:
Min number on-line: x
Min relief rate: y kg/s
Max probability of failure: y%
Max interval between tests : z yrs
One example of a performance indicator that provides a range of acceptable
performance is a pre-alarm limit that can be exceeded for a period of
abnormal operations provided this is monitored. A performance indicator
that does not allow a range of acceptable performance is set at the level of
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the critical operating parameter (see the section on critical operating


parameters).
Performance indicators for control measures should include the following
considerations:
a) failure of any control measures - what are the performance
requirements for functionality, availability, reliability and survivability
of control measures that indicate how or how often the control measures
may fail to perform, and what performance standards are required for
any activities necessary to achieve these standards?
b) reporting of control measure failures - what activities are necessary
to confirm or assure performance, what degree of reporting of failures
is required, how quickly will the reporting system identify a failure, and
what level of independent verification is needed in addition to routine
assurance?
c) corrective action in the event of such failures - what steps are to be
taken and how quickly following detection, and what performance
standards are required of the corrective process?
Performance indicators can be defined at various levels, e.g. there may be
high-level performance indicators as well as lower level and detailed
performance indicators. High-level indicators tend to address overall
performance issues, for example:
a) employee perceptions, incident rates, improvement programs,
availability of control measures which may be taken as indicators of
overall safety performance;
b) maintenance of operating conditions within a critical operating
envelope, which may indicate overall integrity of the process control
regime; and
c) total number of resources dedicated to testing, inspection and
maintenance of critical control measures.
Detailed performance indicators tend to relate to individual measures that
when combined; contribute to achieving overall high-level performance. At
a detailed level, there are many different types of performance indicators
that can be defined for each control measure.
When specifying performance indicators or standards, it may be necessary
to provide detail on who, what, where, and when for implementation of
procedures and activities relating to these indicators and standards. The
responsibility for implementation of performance indicators can be defined
at a very specific level for each performance standard. For example,
responsibility for operational parameters may lie with operations
management teams.
Where performance standards relate to control measures, they should be
assessed as part of the justification of adequacy. It is also necessary to show
that the control measures achieve the standard that has been set. In the
simplest cases, performance standards may be industry standards, codes or
norms. However, these need to be shown to be appropriate to the specific
facility and this can be by a combination of techniques such as:
a) risk assessment results;
b) qualitative argument or reference to the basis for the standard; and
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c) cost-benefit or cost-effectiveness analysis of options.


In more complex cases, where there may be no appropriate existing
standards, the employer may need to demonstrate the suitability of the
performance standard based solely on the risk assessment.
Some examples of performance indicators for control measures:
Management system compliance levels as shown by audit.
Test frequency/interval for safety-critical equipment.
Average skill level of the operations shift personnel.
Compliance level with operating procedures as shown by monitoring.
Number of failures in specific safety devices.
Number of times staffing levels fall below target minimum numbers.
Number of times pressure, temperature etc exceed particular levels.
Measured mechanical integrity (e.g. extent of corrosion).
Detection and response times for unintended material releases.
Sensitivity levels and response times for process alarms.
Compliance levels with manufacturer's or design standards.
Vibration levels in rotating equipment (e.g. compressors).

6.7

Critical operating parameters


For the purposes of this booklet, a critical operating parameter (COP) is the
upper or lower performance limit of any equipment, process or procedure,
compliance with which is necessary to avoid a major accident.
The sum total of COPs may define an overall safe operating envelope for
the facility. Control measures are required to prevent COPs being exceeded;
in general each COP will have at least one associated control measure, and
each control measure will relate to at least one COP. A COP is a process or
other variable that can be measured instantaneously, and where a breach of
the safe operating envelope may be detected by exceeding the COP limit.
This contrasts with performance standards, which are generally something
against which performance may need to be tracked over a period of time, to
determine whether operations are acceptably safe. Performance standards
might include the number of times COPs are exceeded each year. Examples
of COPs are the quantity, pressure, temperature or composition of a material
in storage or process systems, or the manning level at the facility, or the
number of fire-water pumps available on-line.
Each COP may have an associated performance standard, such as the
allowable number of times a soft target associated with the COP is
exceeded. This performance standard then also relates to the associated
control measure. There may be critical design or maintenance parameters
that can be used in setting performance standards. The concept of COPs is
illustrated in Figure 17.

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Figure 17: Illustration of critical operating parameters

6.8

Involving employees in control measures


The Regulations require employers to consult with employees and
contractors (where practicable) in all decision-making processes associated
with controlling risks. The employer should consider defining roles for
employees in relation to adopting or reviewing control measures. Through
this involvement, employees are able to provide their knowledge of how the
facility is operated in practice and assist in identifying the control measures
actually in place. The employees knowledge may also assist in providing
an understanding of how control measures function in practice, and how
they may fail or be defeated. Employees will be aware of issues such as
compatibility and maintainability of alternative control measures and are
vital to the process of selecting or rejecting control measures. The objective
is to make use of employees knowledge and experiences in the working of
the facility.
In practice, only particular employees are involved in this way, however, all
employees must be provided with information, instruction and training on
the adopted control measures regardless of their involvement in the review
and assessment activities. This ensures that all individuals understand the
control measures to the extent necessary to perform their work safely.
Evidence of genuine participation by employees in all aspects of selecting
control measures will make an important contribution to the quality of the
safety report.

6.9

Control measures within the safety report and SMS


Control measures should be systematically managed within the SMS and
must be presented within the safety report. This information should include

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statements on the viability and effectiveness of the range of control


measures considered, methods and results of the corresponding risk
assessments, and the reasons for selection or rejection of control measures.
It should also include the COPs and performance indicators for the adopted
control measures and a justification of the adequacy of control measures,
including the means by which performance is assured. The SMS must relate
to each activity used in the selection and ongoing maintenance of control
measures. Each element of the SMS should have performance standards to
provide regular monitoring of the effectiveness of each element.
Consultative methods used to involve the people working at the facility to
identify and develop control measures should be described.
The employers processes for adopting and managing control measures and
their related information are illustrated in Figure 18. Examples of methods
for recording information, such as a register of hazards and control
measures, were discussed above. However, these can be expanded if
necessary to include additional data on the control measures, for example
consequence and likelihood information from the risk assessment,
performance indicators, the responsibility for "who, what, when and how",
and information to support the justification of adequacy.

Figure 18: Adopting and Managing Control Measures

6.10 Reviewing and revising control measures


Control measures must remain valid or effective for the conditions at the
MHF. Ordinarily, it is improbable that all control measures will always
remain valid or effective, given changes at the facility and new knowledge
about hazards, risks and control measure options.
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Reviews of control measures should be triggered whenever a situation arises


that would indicate that control measures are no longer valid or effective,
for example if there is a proposal to modify the facility, if there has been a
major accident or if a control measure fails to meet the set performance
standard.
In addition, reviews of the safety report HAZID and risk assessment are
required if requested by Comcare and at least every 5 years. It follows that
an ongoing process of reviewing and revising control measures simplifies
the 5-year requirement to review the safety report.

Investigating and analysing control measures


Throughout the above steps, the employer will be reflecting upon existing or
potential new control measures in the determination of causes, likelihood,
consequence and risk. It is essential to be explicit about what control
measures are being included and how they are considered to affect risk
levels. The investigation, adoption and rejection of control measures are
discussed later in this guidance material.

6.11 SMS - A suggested combination of key elements


This section discusses the key SMS elements for the range of control
measures at an MHF.4 This booklet provides guidance on the nature of
control measures, selecting facility-specific measures and ensuring the
effectiveness of the control measures. Refer to Booklet 3 for further
information on the SMS.
The actual configuration of control measures used must suit the facility.
This suggested combination of key SMS elements for control measures is
not intended as a template, but as an indication of the type of elements and
features that should be in place at the facility (refer to Figure 19).

Figure 19: Suggested combination of key control measure SMS


elements

This combination of key elements is mainly derived from the US Department of Labours
Occupational Safety and Health Administrations (usually contracted to OSHA) guidelines for
process safety management (see reference in Appendix A under the topic heading Role and
development of an SMS.)

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