Abnormal Situation Management

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					Abnormal Situation Management
Ian Nimmo ASM Program Director Honeywell IAC, 16404 N. Black Canyon Highway Phoenix, AZ, 85023, MS AZ15/2E7

Alarms, Filtering, Emergency Situations, Quality, Productivity, Safety, Environment, Operators, Training, Incident.

This article discusses the impact of abnormal plant operations and the implications of design, operations, maintenance, and training. Today abnormal plant operations cost industry in excess of $20 billion. A Consortium consisting of Amoco, Applied Training Resources, Exxon, Chevron, Gensym, Honeywell, Mobil, Novacor Chemicals, Shell, and Texaco with the aid of a National Institute of Science & Technology Advanced Technology Program (NIST-ATP), are coordinating resources to address this problem. This paper will address the issues facing the ASM consortium and the challenges that the Hydro Carbon Processing Industry (HPI), Chemical Process Industry (CPI) faces. This is also relevant to the Oil & Gas, Power Generation , Iron & Steel and Pulp & Paper Industry.

Although individual perceptions of abnormal situation management varies, there is consensus that “normal” and “abnormal” represent two distinct modes of operation. Furthermore, abnormal operations are more likely during transition events such as startup and shutdown. Errors in situation assessment can be a source of abnormal situations, assumptions can direct plant personnel down the wrong diagnostic path and due to the response times required to correctly deal with a situation the problem may escalate. The Abnormal Situation Management team spent last year evaluating plant operations and identifying the sources of abnormal operations, and the current management practices that either prevent or are used whilst responding to, abnormal situations. The team discovered that whilst major catastrophes are of concern they are fortunately infrequent and the major costs can be attributed to loss in production, quality problems, economic and conversion efficiency, equipment replacement and a collection of environmental issues. The Consortium has developed a proposal to investigate the benefits of an Abnormal Event Guidance Information System.

1994 Impact Statement It is not the intention of this paper to distort the facts about abnormal situations in the Hydrocarbon Processing Industry (HPI), and the Chemical Process Industry (CPI), however, we can not hide the fact that governments, neighborhoods and workers are concerned by the number of large scale disasters that have occurred over the last thirty years and the potential for loss of life. Fortunately there are few events that give rise to that impact on society that Union Carbide’s Bhopal Plant had and the large loss of life and personal injury. Abnormal situations are clearly a major concern to the process industry, given their potentially catastrophic consequences. According to Lorenzo1, between 1985 and 1990 there were approximately 30 major chemical and hydrocarbon accidents. These severely injured hundreds of people, contaminated the environment, and caused billions of dollars of damage, including cleanup costs, legal costs, loss of market share, fines, and interruption costs. According to John McNamee2 " in the past 30 years, there have been more than 95 fires or explosions in plants around the world which have exceeded ten billion dollars property damage. The average number of major losses has grown from an average of one per year in 1960 to 5.4 per year today. Since 1977, the total property damage has been in excess of three billion dollars. These figures only represent the cost of damaged property and do not include lost revenue to the facility owners while their plants are shut down for repair." Insurance companies are starting to pay attention to the large claims being generated. For example an explosion and fire occurred at approximately 11:00 p.m. in a 50,000 barrel-per-day fluid catalytic cracking (FCC) unit, which was being brought on-line after a seven-week shutdown for maintenance. During the start-up, a drain valve at the bottom of a pressure vessel was improperly closed, letting water accumulate in the vessel. When superheated oil was allowed into the vessel and mixed with the water, a steam explosion resulted, rupturing the vessel. The oil released from this vessel ignited and fire engulfed the FCC unit.3 After the explosion, plant operators isolated the involved FCC unit and two other FCC units at this refinery. The fire then burned itself out at approximately 1:30 a.m. The two other FCC units were brought back on-line since they were not damaged by the explosion or subsequent fire. The business interruption loss associated with this incident is estimated at $44,000,000. Insurance companies often quote the top 100 large property losses in the hydrocarbon-chemical industries over the last 30 years. These losses represent approximately $6.38 billion in property damage, (stated in January 1, 1993,

Lorenzo, D.K. (1990) A Manager's Guide to Reducing Human Errors: Improving Human Performance in the Chemical Industry. Chemical Manufacturers Association. 2 John McNamee, Vice President National Loss Control Division, Alexander & Alexander: "Loss control in Petrochemical Facilities 3 O’Donovan, D.F. (1993) An Insurance broker’s perspective. In Large Property Damage Losses in the Hydrocarbon-chemical Industries

dollars). The loss amounts were trended using an inflation index for petroleum equipment published by Industrial Risk insurers, allowing a comparison of events on a constant-dollar basis over the 30-year period. The loss amounts include property damage, debris removal, and cleanup costs only.3 If we are to address this problem and prevent these incidents and provide tools for operators to perform more efficiently in these situations we must understand the root causes of these incidents and the steps that need to be taken to eliminate or prevent escalation from a abnormal condition to a major catastrophe. The Bhopal accident started out as a minor problem and eventually escalated, the operator was trained and understood the actions needed to make the plant safe. As he implemented the procedures he soon discovered that backup systems were not available, cooling systems had been stripped down for use in other working parts of the plant, the flare stack was under maintenance and he was not aware of the full extent of what was in commission and was not available. When things went wrong it was not from the operators wrong choices, but from their inability to take the correct action. That incident was based on a series of unfortunate circumstances and lack of management of change and coordination of information. There is a very fine line between success and failure in the management of many of these situations. Time is the biggest enemy, and there is little opportunity for correction of mistakes. During the last year as we have studied plants and identified and shared “best management practices” , investigated limitations in today’s technology and ways to improve human performance within the member companies. We have also witnessed these dedicated companies experience many abnormal situations and although they have many safety, quality, environmental improvement initiatives even the “best of class” still experience abnormal situations. In a five month period we witnessed a series of events shown in figure 1 which when viewed from the US economies perspective reveals millions of dollars of lost productivity and market position. As the consortium gathered the facts, they have also been reviewing the work of many companies and organizations who can contribute to a better solution to this problem. The consortium found inspiration in the excellent work done by Don Lorenzo for the Chemical Manufacturers Association, Inc. in his work “A Manager’s Guide to Reducing Human Errors Improving Human Performance in the Chemical Industry”. In this book Lorenzo states:“Historically managers in the CPI have found human errors to be significant factors in almost every quality problem, production outage, or accident at their facilities. One study4 of 190 accidents in chemical facilities found the top four

B. Rasmussen, “Chemical Process Hazard Identification,”Reliability engineering & System safety, Vol. 24, Elsevier Science Publishers Ltd., great Britain, 1989, pp 11-20.

causes were insufficient knowledge (34%), procedure errors (24%), and operator errors (16%). A study5 of accident in petrochemical and refining units identified the following causes: equipment and design failures (41%), operator and maintenance errors (41%), inadequate or improper procedures (11%), inadequate or improper inspection (5%), and miscellaneous causes (2%). In systems where a high degree of hardware redundancy minimizes the consequences of single component failures, human errors may compromise over 90% of the system failure probability”.

Recent Incidents
•Chevron’s Pascagoula MS refinery fire (May) •Chevron’s El Paso refinery explosion (June) •Chevron contaminated AvGas problem (Summer)
•– •will reengine N. California’s light aircraft fleet at cost of $80-100M

•Shell Chemical’s Belpre OH fire (June)
•– •Plant out of service for one year •– •Thermoplastic elastomer supply to international markets strained

•Texaco’s Pembroke refinery explosion and fire (July)
•– •10% of U.K. Refining capacity •– •Both Gasoline and Crude futures displaced 3% in two days

•Exxon Chemical’s Baton Rouge explosion (August 8)
•– •Plant capacity reduced 80%—1% of U.S. total production

•Shell Chemical’s Norco LA plant fire (August 18)
•– •U.S. now has critical shortage of ethylene
Page No. 6

Figure 1 Sample Abnormal Situations for 1994

The facts demonstrate that the CPI has to get serious about eliminating these type of errors but must not use them as an excuse for all failures, or for hiding lack of or poor management to safety. It is easy to associate blame to operator error or alternatively on manpower reduction for failure to respond correctly. An example of this is reported by a Wall Street journal staff reporter who covered a German chemical plant accident. The company had experienced eleven accidents in three weeks and the latest was responsible for the loss of life of one of the company’s employees. The German government called

R. E. Butikofer, Safety Digest of Lessons Learned, API Publication 758, American Petroleum Institute, Washington, DC, 1986.

for more intensive controls of plant safety and after a union official stated that in the interest of safety, firms should stop shedding personnel, the government responded by insisting the firm should recruit and stop its previous policy. The incident occurred at the end of the night shift and has been blamed on a string of human errors-which a company spokesperson says could not be anticipated. Other errors were made directly after the accident. The procedure in the event of malfunctions is intended to protect people outside the works. This incident demonstrated that the company failed to achieve the coordination between works, authorities, and people affected, which is provided for in a company procedure. Adding numbers to this problem will not resolve anything, identification of the root cause, correcting known problems, provision of better tools to eliminate human error combined with a structured strategy for improving human performance must be the way forward. We have seen within the aircraft industry how easy it is for the airlines to quickly conclude pilot error in many situations and for them to take little responsibility for the events which caused the crash or why the pilot failed to recover from the events. One of the strengths that the aircraft industry has is its reporting system which allows unanimous reporting of aircraft problems or near misses and how the database is used by designers, operators, pilots and maintenance organizations together with positive reinforcement from government watchdog bureau. This common learning and strategy of team work which eliminates potential problems has saved many lives. However, the CPI has the opposite views sharing is restricted because of fear of litigation, extremes of either protecting individuals from criticism or legal rebuke to sacrificing operators as the easy “escape goat”. This problem has reached epidemic proportion since OSHA Process Safety Management Regulations became law and new powers and mandates to become self sufficient by issuing violations to industry and extremes such as the OSHA destruction of one of Arcadian’s plants6. It is not enough for a group of individuals to try to solve this problem. The problem is bigger than any one organization or supplier. It requires a coordinated effort from all parties to correctly address this problem. That means that government will have to work with industry, management and workers must work hand in hand and operators and suppliers must be all part of the same team. Management of Abnormal Situations Understanding of Abnormal Situation Management should be driven by management targets and objectives. This I believe is the number one problem that industry faces, management are not providing leadership and direction. This is difficult for a supplier to tell his customers but my hero Winston Churchill stated:6

Catastrophe - the Aftermath: Lessons from OSHA by E. R. Elsbury Presented AIChE 28th loss Prevention Symposium, Atlant, Georgia. April 17-21st, 1994

“You cannot ask us to take sides against the obvious facts of the situation.”
We must apply the lessons that we learned during the Quality revolution, remember W E Deming said,

“The quality problem has started with management condoning inadequate systems, the aim of leadership is to help people and machines to do a better job, Management’s job is to improve systems - what else?”.
I was recently criticized in an ISA ChemPID Feedforward Newsletter by a more experienced engineer now in his ninety second year, who said,

“Up to a point I agree with Mr. Nimmo’s views on the hazards that bring catastrophic consequences, but he does not go far enough in laying the blame for such occurrences. I have seen it too often, management is the culprit. Knowledge is available (most of the time) of how to accomplish safe operation, but the money cost, says let’s do this, and instruct the operators to be cautious, or, I can depend on the operator to keep things under control. Most of the time, the money managers sitting in a plush office miles away for the plant, put a constant pressure on the plant manager, to produce the product at the lowest possible cost. This means the local plant manager is faced with either to skimp on the number of men employed, or hire cheap labor, or purchase cheaper equipment. The priority goes to cost, not to safety.” Ed. E. Scott Feedforward Newsletter Vol. 31 Number 1 January, 1995

While I would agree that elements of Mr. Scott’s letter are true, I do not believe any management would accept anything but safety as their number one priority regardless of the cost. Perhaps I am naïve, but having worked for the United Kingdoms number one petrochemical company for over twenty years, I know were they stand on safety, I remember Denys Henderson, ICI Chairman once saying,

“ICI worldwide must give the highest priority to quality and safety in the pursuit of its objectives. We have to get it right first time, both in the way we work and for the product we deliver to the all-essential customer.”
After visiting many leading companies here in the United States I do not see many differences, however, with the OSHA 29 CFR 1910.119 Process Safety Management Standards, I believe the US has a great potential advantage that will pay back safety investment with productivity, quality improvements, and economic rewards. I am delighted to be working with companies that are prepared to invest in safety as demonstrated by the NIST program and remain confident in the knowledge that we will see substantial economic benefits from the ASM program, for those who participate and

learn from each other. I remember a quote from David Lascelles, UMIST (UK) winner of 1989 EFQM award for a thesis on quality, who said, “There are companies that make things happen, companies that watch things happening, and companies that wonder what happened.” What I do see is both management and workforce struggling with this issue of abnormal situation management, (“Obviously the obvious isn’t so obvious or more people would be doing it” - Tom Peters). They may not call it ASM but I can guarantee it is an issue for them. If companies know how to do something that makes sense they generally do it or go out of business. These statements are endorsed by the lack of metrics in this area, remember again the quality principles,

“What gets measured gets attention and gets done!” - Tom Peters “I often say that when you can measure what you are speaking about, and express it in numbers, you know something about it.” - Lord Kelvin
Once the sources of incidents has been determined and a strategy has been adopted to reduce and eliminate them, metrics can be derived to monitor progress. A formal review of the removal of the individual incidents needs a good feedback and closed loop mechanism similar to the Quality Improvement Process-Corrective Action Reports. ASM requires an understanding by all plant disciplines who team together to remove the potential for errors and during an abnormal event they use their strengths and support their weaknesses to return the process to normal operation, or to mitigate escalation of an event. It is not often the initial event that cause the catastrophic or economic incident, but often lack of time to respond, poor diagnosis, lack of knowledge, incorrect action, or poor use of resources leading to over commitment of individuals. This has been the circumstance in many recent incidents which started quite innocently as a plant shutdown due to say an environmental disturbance such as an electric storm. During a restart the operators have been overwhelmed by the workload introduced by non essential alarm reporting, fast process conditions and equipment intermittent failures. One form of knowledge that is often lost is referred to as the “Corporate Knowledge”, simply described as a set of circumstances that occur and cause an event, and months and even years later the same event happens and the people involved have lost the knowledge or experience from the lessons learnt. Often they only find correlation of the event during an incident investigation. This problem is more dominant today due to the large changes in the workforce. Engineers are often only expected to spend one or two years on a given plant, capable operators move more rapidly through the organization as promotions are now more achievable than they were ten years ago. Out-sourcing of maintenance groups hampers familiarity with equipment, long term life-cycle models and reliability integrity. Other sources of knowledge and information are often hidden in Operator Log Books, individuals (Crib) notes and incident investigation reports. Often only the costly or

near miss incidents get widely circulated, the minor incidents often do not provide feedback to all personnel. Each member of a processing plant’s personnel should understand the safety, environmental, productivity, quality and economic goals that the plant is striving to achieve. The work environment can also play a big part in the success of the operator managing abnormal situations. The organization structure and job design are critical issues that the industry is facing. The ASM team did not investigate job design but tried to identify compatibility to work Structuring practices and seven best practice principles that a partner has developed for Work Structure Analysis:-

The most fundamental structure in any organization is the work process itself. A work process can be defined as a series of steps (i.e. activities), by which raw material is changed into finished product. It also includes business processes. The work structuring methodology allows all other systems and structures to be matched to the work process. Work Structure Definition:Work Structure is an approach to reshaping the way that an organization performs its work. The tools it provides are effective at all levels of an organization from workgroup management to business strategy. Work Structure has built onto the foundations of process analysis the fundamental motivations and needs of people in their place of work. Consequently, its effect is to create a balanced, effective, responsible, stable and therefore productive working environment. Work Structure has proven in industry since the early eighties, improving the effectiveness of a wide variety of companies from manufacturing to the Health Service, from medium sized organizations to large national and multinational companies. Work Structuring has been shown to be far more than a passing “management fashion”. There is clear evidence that as a company adopts its principles, tools and innovative approach to its own business, the effects are strongly beneficial in the short term and cumulative over time. A number of work structuring programs have been running for over ten years and are still yielding new insights and increasing profit. Best Practice Principles:1. Work should be organized around the work processes to form “whole tasks”. 2. The basic organizational unit should be the primary workgroup (i.e., 4-20 people).

3. Each workgroup should include a designated leader. 4. Each workgroup and their leader should, as far as possible, plan and organize their own work. 5. Each workgroup should be able to fully evaluate its performance against agreed standards of excellence. 6. Jobs should be structured so that workgroup members can personally plan, do and evaluate at least one transformation in the process. 7. Personal and structural conditions that encourage teamworking and participation throughout the organization should be established.7
The plant's organization structure needs to provide excellent problem solving capability, speed of judgment, participation by individuals, cohesion and friendship, consensus, flexibility, individual productivity and group productivity. The impact of team working during a twelve hour shift was extremely important to the success of the operation, having a workable rotation system so the operators could continuously improve their overall experience and perform multiple jobs. Many sites we visited the shift system penalized the workforce and often caused fatigue, the handover training needs to be flexible to enable an operator to competently learn new skills and perform his duties as good as the best operator on the plant. The team working and empowerment of all personnel and not just operators needs to be a specific goal of the plant. There seems to be a stronger and more unified connection between management and operations, than by the maintenance and other groups. The maintenance and engineering groups often have a very good relationship with operations but are often hindered by their lack of empowerment. This is a major contributing factor to ASM prevention and resolution. The teaming encourages and enforces ownership of problems. The total environment from management leadership style, work facilities, job satisfaction, and benefits contributed to high individual ownership and personnel productivity. A revolving administrative role also impacts the way a team functions and significantly contributes to addressing the common problems experienced by all shift workers. The shift system at one plant was far superior and less problematic than any other system we have investigated. Job rotation across the shift was very successful based on the teaming skills, joint problem solving and the leadership of the shift team leader. We did see excellent collaboration between cross-functional groups on a plant but are concerned by the lack of site collaboration especially for plants with identical processes and similar equipment. The competitive spirit enforced by management was healthy but the lack of accountability across the site has a negative effect on site productivity. The design of the control room can impact the teams ability to perform to the standards expected, which introduces a serious problem for most manufacturers who adopt old 1940’s control room designs with today’s technology and do not take into consideration

Transforming Your Business Through Work Structure:- P.C. Schumacher, Work Structure Limited

ergonomics. Control rooms tend to evolve over many years and many mistakes are introduced especially during instrumentation revamping projects. Control rooms are often lucky to get an investment of new lighting let alone consideration for human performance and removal of probable human error scenarios. Good ASM promises significant economic returns From the existing plant surveys we have already witnessed the payback that some companies are getting from good ASM practices. However, some of these practices on the surface and during normal operations are difficult to justify with today’s business pressures. In the infrequent times when things really go wrong they are a God-send and can justify their existence many times over, even through years of normal operation balanced against worst case scenarios. One site that we visited had a good practice which involved an extra resource on-shift, who was capable of doing any of the process operations. By using that person during shift rotation to allow training for unfamiliar operators with new work responsibility and technology. The extra person was also used during upset conditions to keep an overview of the whole operation, to check specific operating procedures and ensure the responsible person is following the procedures and no steps are missed in the heat of the disturbance. We witnessed the person monitoring a minor disturbance, checking for procedural errors and finally after corrective actions that person coordinating all other team members to strategize and evaluate the consequences by implementing what-if scenarios if the problem does not go away. This proactive diagnosis prepared the operations team for any future consequence and often eliminated potential escalation of problems. It is very difficult to cost justify the benefit of what might happen and in the case of this plant the extra person was cut because of economic pressures, lack of understanding by decision makers and following industrial trends such as Solomon. Other practices such as designing for abnormal, as well as normal, have easy and well understood benefits. Part of our prime directive within the ASM program is to decrease the total costs of preventable abnormal situations in refinery, petrochemical, and chemical plants by developing better methods for informing operators, better methods for aiding operators during process disruptions, and better methods for preventing process disruptions in the first place. The Consortium believes that the current monetary cost of such disruptions to the U.S. economy exceeds $20B each year. This estimate does not include important but intangible costs, such as environmental damage, human injury, and the impact on quality of life and quality of employment in and near these plants that our solutions will also address. The factors that contribute to this cost are described below.

Petroleum, Petrochemical, and Chemical companies (here referred to simply as petrochemical companies) add value to the economy by efficiently converting raw materials such as crude oil and natural gas and intermediate products such as ethane and hydrogen into useful commodities such as gasoline, agricultural chemicals, synthetic fiber, and plastic resins. The annual revenues of U.S. owned petrochemical installations, or those operated in the U.S. by U.S.-based subsidiaries of foreign companies, were just over $400B in 1993—over 6% of the U.S. GDP of nearly $6,000B. [Statistical Abstract of the U.S.] The operating margins of the business averaged less than 4%, so that only about $15B in profit was generated by these business activities. The cost of converting raw materials include the cost of the materials themselves and manufacturing costs such as large capital investments in processing equipment, energy and materials required for processing, and the specific environmental and safety costs associated with vitally important but potentially dangerous processes. These latter costs include insurance, environmental mitigation, safety equipment, training, hazardous waste treatment, and health and safety monitoring. Abnormal situations are defined here as the development of non optimal conditions in a plant which the automatic control equipment can not cope with, and which require human intervention. Abnormal situations can arise from equipment failure, human errors of various types (e.g., operational, maintenance-related, plant design), unexpected process chemistry (e.g., contaminated feed stock), weather (lightning strikes, extremes of temperature, wind), and a variety of other causes. Most such abnormal situations are quickly and efficiently dealt with by plant personnel. Some abnormal situations result in poor quality product (which must be discarded or reprocessed), schedule delays, decreased process efficiency (more fuel is burned to provide additional heat to a reactor), and other real operational costs. A small percentage of abnormal situations require the process to be shut down and restarted, leading to interruption of business and disturbances in upstream and downstream business operations. And, a tiny fraction of abnormal situations result in significant equipment damage, release of undesirable materials into the environment, and even human injury or death. Analysis of the impact of abnormal situations requires assessment of the costs due to various sources, and some of these costs are difficult to determine occur only rarely. The impact of abnormal situations on the economy includes costs due to:     Damage to process equipment, surrounding communities, and the environment. Injuries, and, rarely, loss of life. Loss of production from damaged process equipment. Business disruptions caused by the lost consumption of intermediate products produced elsewhere (e.g., the loss of a polyethylene unit may result in a plant needing to reduce throughput in other areas to cut back on the production of ethane which would normally be consumed by the damaged process).

  

The need to reprocess or otherwise dispose of product that does not meet quality standards. The practice of running plants less efficiently than could be attempted, in order to maintain safety margins for operator response. Insurance premiums.

The need for the continual and intensive training required, especially given the absence of good proven training technologies such as simulators. Any reduction in the costs of petrochemical products will be magnified by the economic system: Changes in the cost of energy and raw materials would lower the costs associated with producing and transporting textiles, consumer products, agricultural products, and almost all other segments of the economy. Many of these impacts are difficult to assess, and we have been conservative in developing a model of the impact of abnormal situations. Nevertheless, very large impacts can be easily justified.  Damage to process equipment, surrounding communities, and the environment. Plant damage figures associated with accidents are relatively easy to identify. According to insurance industry figures, there have been over 550 major accidents (damages exceeding $500K) over the last five years, with total equipment damage costs of 12.9B—nearly $2.6B per year. The worst accident during this period, and indeed the most costly non-natural disaster in U.S. history, was the 1989 explosion in the Phillips polyethylene plant near Houston (caused in part by human error), which resulted in a total economic loss of $1.6B, $700M of which was damages to the plant and the surrounding community. Most petrochemical installations self-insure smaller losses, so the cumulative cost of incidents is more difficult to determine. However, since data from petrochemical and insurance industry sources indicates that the distribution of incident costs fits an exponential decay function, we can assume that the total cost of smaller incidents is at least the same order of magnitude as the cost of the larger ones. Total equipment damage costs due to abnormal situations, therefore, are estimated to be at least $5B per year world wide; since U.S. operations and the operations of U.S. companies constitute 75%* of the world-wide total, the loss to the U.S. economy from this factor is $3.75B annually. Claims for death or injuries. Compared to many heavy industries, the safety record of the petrochemical industry is exemplary. Lost time accidents therefore represent a comparatively minor economic impact, and costs due to injuries resulting from abnormal situations (as opposed to, for example, falls from scaffolding) are less significant still. Nevertheless, the potential for extremely severe impact (as in Bhopal, an accident in which human error played a significant role) while extremely unlikely, is always present. Despite the large psychological impact, we estimate the economic impact of this factor to be relatively insignificant on an actuarial basis.



Loss of production from damaged process equipment and other operational impacts of accidents. This factor contributes significantly to the cost of abnormal situations. The same insurance analysis cited above puts the costs of business interruption at 1.5 to 3.5 times that of plant damage. These costs are becoming much more significant as the industry continues to consolidate production in fewer, more efficient facilities. Even in the recent period of relative over-capacity in the industry, the impact of lost production has been significant because of the disruption to operations that results when complex feed stock supply and production routing relationships are disrupted. For example, the 1989 Phillips explosion required an unaffected refinery in Texas to drastically reduce output to 40% of normal because there was no market for the ethane that its processes had been optimized to produce as a key feed stock for the polyethylene facility. The overall loss of production impact from this single incident approached $1B. Assuming a currently conservative ratio of loss of production to equipment damages of 2.5 to 1, the annual cost of loss of production to the U.S. petrochemical industry is about $9.375B annually. Losses due to inefficiencies not caused by or resulting in equipment damage. Many petrochemical processes can reach very high levels of efficiency when controlled by advanced process control equipment. Multiple-input, multiple output controllers, neural networks, and other global and localized optimization techniques, enabled by modern distributed control system architectures, have become increasingly available. Unfortunately, these advanced techniques and the complexities of modern processes have taxed the capabilities of plant personnel to respond effectively to process disruptions Processes therefore rarely run at their designed maximum levels of efficiency for sustained periods of time. The opinions of industry experts vary widely on the extent of these losses; numbers in this section represent the most conservative consensus of ASM Consortium members.


In addition to losses from inefficient processing, plants using advanced control which require very fast response times from plant personnel are sometimes deliberately run at lower than maximum levels of efficiency in order to provide a safety margin for operations personnel. Just as advanced flight control systems are capable of controlling the flight of experimental aircraft that are otherwise uncontrollable, automated control systems are capable of performance that operators can not duplicate. While the requirement to eject when the flight control system fails is an appropriate risk for a test pilot, it is not an option open to responsible process operators. Consequently, many petrochemical processes are normally and/or deliberately run at efficiencies well under what could be achieved using existing equipment. Since the capital equipment, operational staff, raw materials, and most other process costs are already paid for, any increase in efficiency would directly impact the industry’s bottom line. Efficiency gains are often expressed in this industry as a percent of the cost of feed. Three percent of the current $90B cost of crude input to U.S.-operated refineries—which industry sources believe is readily attainable— is $2.7B of additional earnings, which amounts to approximately 5% of refinery gross operating margin.


Insurance, training, and other operational costs. The expenses associated with insuring the petrochemical industry are reflected in coverage which costs more, which has higher deductibles, and which is more difficult to obtain, even for companies with loss-free records. The costs of training plant personnel to efficiently operate today’s complex processes are higher than they could be if the process control systems provided more support for the operators, particularly during infrequent operational activities such as start-up or shut down. While these costs are significant, they are difficult to estimate and so are excluded from this analysis. Also excluded are costs of complying with environmental and health and safety regulations. With increased environmental awareness has come new restrictions on plant emissions, which can sometimes lead to the imposition of financial penalties on plants when actions are taken which, while necessary to safely resolve an incident, lead to e.g., excess flaring. The Future Once we have fixed and enhanced the existing management systems we can contemplate addressing the missing technology area that lies between return to normal operation and bring to a safe state. The site study can deliver significant benefits as we contemplate changing the culture from a reactive control system, driven by alarm symptoms that support designs for normal and emergency situations to one which invests significant design time to abnormal situations as it does to normal and moves to a culture of prevent and predict and strives to eliminate reacting. For the next generation technology to deliver its promises we must first encourage CEO’s to become evangelists for safety and abnormal situation management, to remove inadequate systems and practices, to insist on root cause analysis and ASM metrics, to understand the issues relating to human performance, ergonomic designs and elimination of human errors. Every plant must have a human performance improvement program that incorporates a human reliability analysis. We need human factor expertise and this can be achieved by developing this new discipline and/or by making all personnel competent in human factor assessment. Once we achieve this suppliers can provide technology such as Honeywell’s “Abnormal Event Guidance Information System” (AEGIS) which will bridge the knowledge gap and provide the benefits of computer technology:      Fast processing of multiple systems Information and data context sensitivity Predictive diagnosis, analysis and state estimation Multi-disciplined information retrieval and communications systems Complex calculations and rationalization Development of operations and control strategies based on plant objectives

The future will allow complex models to be used for multiple applications, which in turn will provide very cost effective ROI. Integration of operator equipment and removal of non-essential equipment is a priority.

Within the next five years we should see field operators with hand held devices which will allow them to diagnose problems for the themselves and bring their knowledge of the process up to the same level as the control room console operator. Supervisors currently have lost their view of the process and their process knowledge has become very poor compared to the console operator. The big overview panel may return but this time not hardwired but programmable and be just projection images with touch sensitive navigation and zooming. Ian Nimmo  ASM Program Director

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