SPE 87030 Development and Implementation of Risk Based Inspection Methodology in Managing Inspection of Pressurized Production Facilities

Kusmaryanto Dewanto and Rommy Christian, VICO Indonesia, and Ricky Wibowo, PT Radiant Utama

Copyright 2004, Society of Petroleum Engineers Inc. This paper was prepared for presentation at the SPE Asia Pacific Conference on Integrated Modelling for Asset Management held in Kuala Lumpur, Malaysia, 29-30 March 2004. This paper was selected for presentation by an SPE Program Committee following review of information contained in an abstract submitted by the author(s). Contents of the paper, as presented, have not been reviewed by the Society of Petroleum Engineers and are subject to correction by the author(s). The material, as presented, does not necessarily reflect any position of the Society of Petroleum Engineers, its officers, or members. Papers presented at SPE meetings are subject to publication review by Editorial Committees of the Society of Petroleum Engineers. Electronic reproduction, distribution, or storage of any part of this paper for commercial purposes without the written consent of the Society of Petroleum Engineers is prohibited. Permission to reproduce in print is restricted to an abstract of not more than 300 words; illustrations may not be copied. The abstract must contain conspicuous acknowledgment of where and by whom the paper was presented. Write Librarian, SPE, P.O. Box 833836, Richardson, TX 75083-3836 U.S.A., fax 01-972-952-9435.

Introduction VICO Indonesia operates in Sanga-sanga PSC, East Kalimantan Indonesia, since 1968. It became major gas producer for world largest LNG plant in Bontang, Indonesia, since 1977. Current production is 1.0 BCFPD and 30,000 BOPD. It has pressurized production facilities such as 1,379 static equipment, 11,096 in-plant piping, 568 flowlines and 43 pipeline/trunkline at 5 (five) main fields i.e. Badak, Nilam, Semberah, Mutiara, and Pamaguan/Beras. The oldest plant is Badak, built in 1976, and the youngest is Mutiara, built in 1991. The goal for VICO Indonesia is to develop, produce and deliver oil and gas in reliable manner with the highest priority by conducting all activities safely, with no harm to people or the environmental damage. As a responsible operator, it has two main objectives in operation of its facilities. They are; to ensure the integrity of all the time and ensure safe and serviceable facilities throughout the end of Production Sharing Contract (PSC) contract. Equipment inspection for mechanical integrity, safe and serviceable facilities is a major issue to verify that equipments is capable for use to prevent accident or minimizing catastrophic hazard. It is known that there are two extremes inspection, both undesirable. One extreme is very little inspection by replacing the equipment when it leaks or fail. The reason why this extreme is unacceptable is obvious. On the other extreme is inspection of all pressure equipment so often and so thoroughly that it becomes high cost. Risk Based Inspection (RBI) breaks the both extreme inspection in that it uses risk as a basis prioritizing and managing the effort of an inspection program. RBI is implemented as apart of strategy to reduce risk and at the same time to improve mechanical integrity and operation reliability. Some examples of RBI in action and lesson learned are presented showing the benefit achieved through application of RBI and feedback for its continuous improvement. Inspection Option History The most important factor in operation integrity is reducing the rate and severity failure of facility, especially during operation. The Operation Efficiency Study in 1994 identified that the facilities damage in VICO Indonesia is mostly caused by CO2 corrosion process. Previously, there was no much

Abstract VICO Indonesia operates in Sanga-Sanga, East Kalimantan produce gas and oil with approximately 1.0 BSCFD and 30,000 BOPD in 5 main plants; Badak, Nilam, Semberah, Mutiara, and Pamaguan. VICO Indonesia is continuously encouraged to reduce operating costs by minimizing operations cost and optimizing operability. One of the strategies is using Risk based approach methodology in carrying out inspection management for pressurized production facility. The objective of risk-based inspection is to ensure and maintain the required confidence of pressurized production facilities and maximizes its operating availability by planning of inspection interval and methods. The basic steps of risk-based inspection are: Creation and maintenance of asset register Assessment of consequence and probability of failure Creation inspection planning Evaluate the inspection results Review by risk based team approach The feedback loop of risk-based inspection is essential for the continuous improvement. This paper summarizes the experience in developing and implementing risk based inspection strategy for tackling the most failure mode in VICO Indonesias pressurized surface production facilities. A description is given on how to focus inspection resources using risk based team approach involving inspection, operation and process engineers. A challenge of obtaining a reliable and cost effective inspection technique is also described. Finally, some useful lesson learned are included to prevent common problems from recurring, to stimulate the application of better practice and where possible to prevent or reduce the failure.

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inspection history on the most of equipment to rely for its Preventive/Predictive inspection program. Initially, the program was reactive and conducted when equipments was fail or break and some cases statutory or time based, such as pressure vessel. To reduce the unexpected failure of facilities in operation and change the previous reactive inspection philosophy, the Production Operation Review in 1997 recommended implementing integrated inspection program. The traditional inspections that are based on probability of failure or consequences of failure alone only are applied without making any distinction on the risk category items. In an operating field, a relative large percentage of risk is usually associated with a small percentage of equipments items. As such, if inspection were carried out without any discrimination, the inspection costs will be certainly high. A Risk Based Inspection (RBI) method, which is based on probability of failure and consequences of failure, were then chosen. The RBI project implementation was started on 1998 and fully implemented in 2000 for static equipment and in-plant piping. A lot of time was consumed to find out all correct information, since the accuracy data is crucial. Implementation of RBI allows the inspection focused on the high risk items, apply effective inspection technique to monitor them and improve safety and reliability as well as reducing costs. The RBI implementation project for flowline and pipeline/trunkline was started on 2002 and just finished initial integrity review. Risk Based Inspection Risk. Risk is product probability and consequence. In the term of risk-based inspection this is product of probability of failure and consequences of failure. Risk Based Inspection (RBI) Methodology. The goal of inspection is to detect deterioration before failure. In most circumstances it is not possible to set date that will ensure absolutely that deterioration is detected before failure. RBI is a systematic approach, which prioritizes the inspection activities on the basis of risk. The concept of risk is used to target the inspection resources of pressurized production facilities where they can have the greatest effect in reducing level of risks, unplanned failures and unnecessary inspection. RBI is both a qualitative and quantitative process for systematically combining both the probabilities of failure and consequences of failures. There are three possible approach of RBI assessment qualitative, semi quantitative and quantitative where each having different level of complexity, different degree of accuracy and different potential cost benefit. All the approach is useful at various stage of the development of inspection plan. Qualitative assessment uses engineering judgment, expertise, and specific operation experience for the analysis of probability and consequence of failure. Use of engineering opinion maybe more accurate in many situation that are not adequately covered by an empirical model. The accuracy of results from a qualitative analysis is dependent on the

background and expertise of the analysts. Semi quantitative methods are primarily based on rule based analysis. The rule for predicting probability of failure is generally standard mode such as de Waard and Milliam for CO2 corrosion. The accuracy of predictions will be influenced as much by the quality of input data as by inherent accuracy of the models. Quantitative assessments are based on statistical calculation using large historical database for probability of failure. In practice, a RBI typically uses aspects of qualitative, quantitative and semi-quantitative approaches. These RBI approaches are not considered as competing but rather as complementary. In this case, the most of static equipment and in-plant piping uses semi-quantitative assessment. A qualitative assessment uses in the most of flowline, pipeline and trunkline Compliance The codes are currently used as guidelines are API RP-580 for RBI, API BRD 581 for RBI Base Resource Document and API RP 579 for Fitness for Services (FFS). API RBI covers only the breach of pressure containing members. It does not cover the functional failure of non-pressurized equipment. Though the RBI technique is in infancy, both API 510 (Pressure Vessel Inspection Code) and API 570 (Piping Inspection Code) endorse the use of RBI. Risk Based Inspection Program Development There are 8 (eight) steps to developing RBI program: 1. RBI company policy 2. Create an asset register 3. Carry out process review and define pressure system or segmentation 4. Determine consequence of failure 5. Determine probability of failure 6. Determine Risk Rating 7. Carry out initial integrity review 8. Define an Inspection program (Interval, Methods and Scope) Once the initial program has been developed, a feed back of looping including the following to be put into place to ensure continuous improvement 1. Implement inspection 2. Assess inspection results 3. Integrity Review 4. Update database 5. Update inspection program A schematic of the RBI system and development is shown in figure 1. RBI Company Policy A RBI program must include updating from the results of inspection, monitoring and process change. Since RBI reflects the state of the plant at the time data were collected, it is essential to maintain the RBI data up to date with plant changes and the results of inspections

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RBI is a team-based activity. A company policy was needed to establish a framework for: - Who are involved on the team - What are their roles in RBI process - Who are responsible and accountable for what action - How the RBI process is carried out - When the RBI is updated Creation and Maintenance of Asset Register, and Process Reviews The asset register contains all equipment data completed with operating and design of equipment and the others information related to corrosion process and others failure modes. This data is the basis for computing the probability and consequences of failures, and unless it is properly maintained, the resulting inspection strategy is not correct. The data may be gathered from Piping and Instrumentation Drawing (P&ID), Process and Flow Diagram (PFD), design calculations, fabrications drawing, piping specification, isometric, operating parameters, and past inspection records. One of purpose of Integrity Review is to ensure that all data having impact on RBI assessment remains valid and historical inspection has been incorporated in the Probability of Failure Ratings. The asset register is subdivided by plant area, piping system and equipment type for static equipments (including pressure vessel, tanks and heat exchanger) and in-plant piping. For pipeline, trunkline and flowline divided by sections. The initial task was to determine what item were to be evaluated. The P&ID or isometric drawing were then color coded accordingly to specific pressure system and/or its segment and sections prior to be input into databases and software. Design data, operating condition, and interviews with operations personnel are then used for RBI assessment. Pressure System. Pressure system for static equipment and in-plant piping is defined as the system contains a similar fluid that flows under similar operating condition. Section. The pipelines, trunklines and flowlines were divided into sections based on virtue location, pipe specification, pipe dimension data, and population Consequences of Failures There are three mains areas of consequences to be assessed economic, safety and environmental. Economic covers to standby and financial. Safety covers location class, fluid content, inventory, pressure, and population. Environmental impact covers environment. The criteria are typically given in qualitative terms such as 1, 2 and 3 high based on the value data range value of each. The overall consequence of failures is noted as high, medium or low. Operation personnel having sufficient knowledge of the process unit operation assess standby, Financial and Location criteria.

The calculation of overall consequences is based on average of the seven criteria rating, excluding the financial value where shown in table 1. If the financial rating is high and the total consequence rating is low or medium, the total consequences rating is increased by one level from low to medium or from medium to high. If the financial rating is medium and the total consequences rating is low, the total consequences rating is increased by one level from low to medium. Probability of Failures Based on the experience in implementation of RBI, the probability of failures is divided into internal corrosion, external corrosion, erosion, mechanical damage and cracking. The probability of failures is noted as high, medium or low. The dominant probability of failure is internal corrosion by CO2. The probabilities of failure due to internal corrosion is assessed using semi quantitative approach The typical model to determine probability of internal corrosion is described on figure 2. The other type deterioration mechanism such as external corrosion, erosion, cracking, mechanical damage, corrosion-erosion, are assessed by qualitative assessment. Criticality Determination The criticality rating is determined by combination of the Consequence of Failures and Probability of Failures, the summary is described in table 2. Integrity Review. Integrity review is conducted to up-date the asset register and to review the results of inspection. The purpose of integrity review is: - to identify any addition, change or deletion to the asset register - to determine the actual condition of items and their fitness for purpose - to observe the deterioration mechanism and rate. - to establish confidence level in deterioration rate predictability Integrity Review Team. A competent team that includes inspector, inspection engineer, plant operator, process engineer, and corrosion engineer carries out the Integrity Review. The communication on team may be directly or via email. Process review. The team shall review all available design and construction data. It is also included reviewing inspection report and determining whether the extent of inspection will be done. Confidence Level. The confidence level of any deterioration rate is represent by inspection grade, as follows: Grade 0. Equating to the high probability of failures. Item for which: - No inspection history or deterioration data or unpredictable rate - The rate of deterioration may not be forecast from past data

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Remaining life 4 years Measure rate 5 mpy

Grade 1. Equating to the medium probability of failures. Item for which: - At least one inspection at grade 0 and deterioration has been shown to be a reasonable medium predictive/ inspection results rate. - Remaining life > 4 years, but 8 years - Measure rate < 5 mpy, but 3 mpy Grade 2. Equating to the low probability of failures. Item for which: - At least one inspection at grade 0 and deterioration has been shown to be a low predictive/ inspection results rate. - Remaining life > 8 years, but 12 years - Measure rate < 3 mpy, but 1 mpy Grade 3. Equating to the negligible probability of failures. Item for which: - At least one inspection at grade 1 or 2 and deterioration has been shown to be a very low predictive/ inspection results rate. - Remaining life > 12 years - Measure rate < 1 mpy

assessment of internal condition. Table 4 show assessment condition of static equipment and table 5 described a Non Destructive Test (NDT) requirement based on probability of failure. Example RBI in Action Example 1. Based on asset register list, there are 11,096 inplant piping. The criticality status after the last integrity review indicated 731 items or 6.6% having risk ranking 1 and 2 (criticality-1 and criticality-2). The inspection strategy is focused only on this lines group. This will save approximately US$ 172,000 compare with the conventional inspection philosophy. Example 2. Figure 3, 4, 5 and 6 represent criticality distribution of in-plant piping, static equipment, flowline and pipeline/trunkline. Figure 3 and 4 show the risk distribution of in-plant piping and static equipments shift from high risk into low risk as the inspection program and integrity review were implemented. The inspection strategy then focused on this high risk. The RBI implementation will reduce the overall risk of the plant operation. Figure 5 and 6 show risk distribution of flowline and pipeline/trunklines. This distribution will allow prioritizing the inspection items Example 3. The inspection on one of 16 header piping having criticality 1 at Badak Field revealed severe internal corrosion indication as well as RBI prediction. The header capacity at that time was 426 mmscf/d with operating pressure of 820 psi. The corroded pipe was then replaced as well as RBI team recommendation. It is an example of RBI as preventive action to avoid the unexpected failure or unplanned shutdown Lesson Learned Data Gathering. Data gathering at beginning of RBI project was consuming time. This includes initial data entry and systemization. In addition to that missing data resulted some lost time in attempts at sourcing and retrieval. Minor Leaking. Some minor unpredictable leaking were found as results of: - Corrosion erosion on one chemical injection piping. It caused by impingement process of flow turbulence fluids. The extension of inspection on the other similar piping also found corrosion erosion indication. A similar recurrence has been avoiding by replacing or close monitoring to the section lines having corrosion erosion. The corrosion erosion has been remedied by installing quill at chemical injection points. - Fatigue cracking at piping due to poor quality weldment at fabricator. An extension of inspection on similar type weld and fabricator also found poor welding quality on some weldments. The poor welding quality were then repaired/replaced.

Inspection Plan Development The purpose of inspection or examinations is for ensuring that the equipment is in satisfactory condition for continued operation There is 3 degree of freedom in developing inspection plan. They are: - The criticality, in combination with the inspection grade is used to determine the inspection interval. - The consequence of failure is used to derive the inspection scope - The probability of failure is used to select appropriate inspection methods Inspection Intervals. The criticality rating together with inspection grade are used to determine the inspection intervals. The table 3 is used for determining the interval inspection periods for the case of internal corrosion. In some case, a qualitative assessment may be used for determining inspection interval. Inspection Scope. Inspection scope is determined by consequence of failure. A detailed inspection scope is assigned to items with high consequences of failures. A general scope is assigned to items with medium consequences of failure and a limited scope is assigned for the item having low consequence of failure. Inspection Methods. For pressurized production facilities such as piping and static equipment, the inspection scope should be included an external visual inspection and an

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Conclusion An economic advantage can be obtained by implementing risk based inspection strategy which this strategy involve effective inspection methods and scope compared to the traditional methods The RBI methodology implementation has been outlined briefly in the example of RBI in action where not only was substantial cost saving, but a much clearer understanding in risk reduction of pressurized production facilities, help in ranking the item based on risk to prioritized inspection, and avoid unexpected failure or unplanned shutdown. Some lesson learned and experiences are gathered as an input to continuously improve inspection program to be implemented to pro-actively manage any probability of failures.

Acknowledgement The authors appreciate and thanks to BPMIGAS, BP-ENI and VICO Indonesia management for permission of this paper to be presented. Reference 1. Cusnaghan, Susan, Economic of Risk Based Inspection Systems in Offshore Oil and Gas Production, Tischuk, Enterprises Ltd (UK) 2. Tischuk, John L., The Application of Risk Based Inspection Approach to Inspection Planning, Tischuk Enterprise Ltd (UK) 3. VICO Indonesia, Recommended Practice for Risk Based Inspection, 1998 4. API Recommended Practice 580, Risk Based Inspection, first edition, 2002 5. API Publication 581, Base Resource Document-Risk Based Inspection, 2000 6. Keong, Lim See and Ravi, K.N.K, Risk Based Inspection: Experience and Benefits, Hydrocarbon Asia, March 2000 7. API 510, Pressure Vessel Inspection Codes, Eight edition, June 1997, Addendum 3, December 2001 8. API 570, Piping Inspection Code, second edition, October 1998, Addendum 1, February 2000

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Create Asset Register Collect Technical Data Verify Data Collect Operational Data

Initial Integrity Review

Determine Consequences of Failure

Determine Probability of Failure

Determine Criticality and Inspection Grade

Inspection Program

Inspection Interval

Inspection Method

Integrity Review

Inspection Scope

Assess Results

Figure 1. A schematic of Risk Based Inspection System Development

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Average of consequences Less than or equal 1.5 Greater than 1.5 and less than 2.5 Greater than and equal 2.5

Consequences High Medium Low

Table 1. Calculation to determine consequence rating, except financial aspect.

Figure 2. Flow chart to determine probability of failures due to internal corrosion

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Probabilities of Failure HIGH MEDIUM LOW HIGH 1 2 3

Consequences of Failures MEDIUM 2 3 4 LOW 3 4 5

Table 2. Matrix for determining criticality

CRITICALITIES

GRADE 0

GRADE 1

GRADE 2

GRADE 3

CONSEQUENCES

1 2 3 4 5
PROBABILITY OF FAILURE

2 2 2 3 3
HIGH

N/A 3 3 4 N/A
MEDIUM

N/A N/A 6 7 7
LOW

N/A N/A 8 10 12
NEGLIGIBLE

H H/M H/M/L M/L L

Table 3 - Illustrating the relationships between Inspection grades, Criticalities, Probabilities of Failure, Consequences of failure and the Integrity Examination Intervals (in years) for Piping and Static Equipment.

Low Consequences of Failure Limited Assessment Borescope Or External NDT Or Process review

Medium Consequences of Failure - General Assessment Borescope and External NDT Or Internal entry Or Process review and External NDT

High Consequences of Failure - Detailed Assessment External NDT and corrosion monitoring and process review or Internal entry

Table 4 - Requirements for Internal Assessment

Failure Mode Internal Wall Thinning

External Wall Thinning

Mechanisms Internal Corrosion Erosion Weld Corrosion External Corrosion Corrosion Under Insulation Fatigue

NDT Methods Ultrasonic Radiography Visual Inspection Radiography Thermography Ultrasonic Radiography Magnetic Particle Liquid Penetrant

Cracking

Table 5- NDT Inspection Methods Based on Probability of Failures

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4500 4000 3500 3000 Piping 2500 2000 1500 1000 500 0 1999 2000 2001 Year 2002 2003

N/D Crit 1 Crit 2 Crit 3 Crit 4 Crit 5

Figure 3 In Plant Piping criticality Distribution

1000 900 800 Static Equipment 700 600 500 400 300 200 100 0 1999 2000 2001 Year 2002 2003

N/D Crit 1 Crit 2 Crit 3 Crit 4 Crit 5

Figure 4. Static Equipment criticality Distribution

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180 160 140 120 100 80 60 40 20 0

Crit-1 Crit-2 Crit-3 Criticality Crit-4 Crit-5

Number of Flowline

Figure 5. Flowline Criticality Distribution Based on Initial Integrity Review

250 200 150 100 50 0 Crit 1 Crit 2 Crit 3 Risk Crit 4 Crit 5

Number of Sections

Figure 6. Pipeline/Trunkline Section Criticality Distribution Based on Initial Integrity Review

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