Lessons Learned From PSM Audits: Presenters: Carolina Del Din May 23, 2018

Lessons Learned from
PSM Audits
Presenters: Carolina Del Din

May 23, 2018
Copyright © 2018 PSRG Inc.

2
Outline
• What is an audit?
• Why are audits important?
• Regulatory requirements
• Audit procedure
• Common deficiencies found in PSM audits
• MaturityModelTM

3
What is an Audit
• An audit is a systematic, independent review to
verify conformance with established guidelines or
standards. It employs a well defined review
process to ensure consistency and to allow the
auditor to reach defensible conclusions.
(Guidelines for Auditing Process Safety
Management Systems, 2nd Edition, CCPS 2011)
• Systematic, independent and documented process
for obtaining audit evidence and evaluating it
objectively to determine the extent to which
the audit criteria are fulfilled. (ISO 19011:2011(en)
Guidelines for auditing management systems)

Why is PSM Auditing Important?

5
Lessons from the Past

Bhopal
1974 Seveso
1979 1989
Flixborough 1976 Three mile

Island
1984 Phillips
Pasadena, TX

6
Process Safety Regulations
• 29 CFR 1910.119, OSHA Process Safety Management

of Highly Hazardous Chemicals – Promulgated 1992
• 40 CFR Part 68, EPA Risk Management Program Rule

– Promulgated 1996

7
Are the Regulations Working?

DuPont Insecticide
Deep Water Plant
2005 Horizon
2013
2010 2015
Buncefield West, TX
and
BP Texas City
8
What is Being Done?

PSM Regulations have not changed since their
promulgation, but…
• Letters of Interpretation
• OSHA Petroleum Refinery Process Safety Management
National Emphasis Program (NEP) Directive – 2007
• OSHA PSM Covered Chemical Facilities National
Emphasis Program (NEP) Directive – 2011
• Executive Order 13650 (August 1, 2013)
• More chemicals, lower TQs, more covered facilities
• EPA revised the RMP Rule

9
Compliance Audit – Why?

• Excellent tool to assess an
organization’s Process Safety
effectiveness – written program and
implementation
• Assess compliance; benchmark
performance with industry
• Identify and mitigate “early warning
signs” before a potential incident
• Integral to “PLAN – DO – CHECK – ACT”
cycle of continuous improvement
• Required under PSM/RMP

Regulatory Requirements

11
Elements of PSM
1. Employee Participation 8. Mechanical Integrity

2. Process Safety 9. Hot Work
Information 10. Management of Change
3. Process Hazard Analysis 11. Incident Investigation
4. Operating Procedures 12.Emergency Planning and
5. Training Response
6. Contractors 13. Compliance Audits
7. Pre-startup Safety Review 14. Trade Secrets

12
Processes & Chemicals Covered

• OSHA (29CFR1910.119)
• A process which involves a chemical at or above the specified
threshold quantities listed in Appendix A of OSHA 29CFR
1910.119
• A process which involves a Category 1 flammable gas or a
flammable liquid with a flashpoint below 100 oF on site in one
location, in a quantity of 10,000 pounds or more
• EPA (40CFR68)
• A threshold quantity of a regulated substance listed in
§68.130 is present at a stationary source if the total quantity
of the regulated substance contained in a process exceeds
the threshold

13
Compliance Audits
• 1910.119(o)(1), 68.79(a): Employers shall certify that they

have evaluated compliance with the provisions of this section
at least every three years to verify that the procedures and
practices developed under the standard are adequate and are
being followed.
• 1910.119(o)(2), 68.79 (b): The compliance audit shall be
conducted by at least one person knowledgeable in the
process.
• 1910.119(o)(3), 68.79 (c): A report of the findings of the
audit shall be developed.

14
Compliance Audits
• 1910.119(o)(4), 68.79 (d): The employer shall promptly

determine and document an appropriate response to each
of the findings of the compliance audit, and document that
deficiencies have been corrected.
• Employers shall retain the two (2) most recent
compliance audit reports.

15
What the Facility and/or Company

Hopes to Get Out of the Activity?
• Gap analysis
• Communication of information and Feedback
• Performance Measurement
• Monitoring PSM program continuous improvement
• Reducing the process safety risk
• Training of Auditors
• Sharing successful or best practices

16
Audit Procedure
• Lead Auditor puts a team put together
• An audit schedule is put together
• Request for information is sent to the facility
• An audit protocol is developed
• Site Tour
• Audit information is gathered through
• Interviews
• Site walk-through
• Records review
• Audit results are analyzed and findings are presented to
the facility
• A report is prepared and certified
Common Deficiencies

18
Common Deficiencies
Employee Hot Work Permit
Participation PSSR 1% Trade Secrets
Emergency Planning 1% 1% 0%
and Response
2%
Training
3%
Contractors Mechanical Integrity

3% 19%
Compliance Audit
4%
Incident
Investigation
7%
Management of
Change Process Safety
8% Information
17%
Operating
Procedures
17% Process Hazard
Analysis
17%

19
Common Deficiencies
• OSHA NEP for Refinery
• Total 1088 PSM citations
• 70 % are part of the MI, PSI, PHA and Operating
Procedures elements!

20
Common Deficiencies
Employee Pre-Startup Hot Work Permit
Safety
Participation Review 0% Trade Secrets
Emergency Planning 2% 0%
1%
and Response
1%
Training
3%
Contractors
2% Mechanical Integrity
23%
Compliance Audit
5%
Incident
Investigation Management of
3% Change
6%
Operating
Procedures Process Safety
17% Information
21%
Process Hazard
Analysis
16%

21
Common Deficiencies
• OSHA NEP for Chemical Facilities
• Total 678 PSM citations
• 76 % are part of the MI, PSI, PHA and Operating
Procedures elements!

22
Common Deficiencies - BASIS
• 350+ audits / assessments performed

• 2010 – 2016
• Large, major operating companies to smaller, niche
specialty chemical companies and industries

23
Site Walk-through Observations
Cracked Hoses
Leaking Liquids

24
Site Walk-through Observations

Lack of ID for
Manual
Valves
Rusty Pipes
Lack of Hazard Communication Signage

25
Common Deficiencies
Definitions of PSM Boundaries
• Boundaries of PSM-covered process not well-defined or
documented; leading to inconsistent interpretation of PSM
boundaries across different departments and incomplete PHA
assessment
• Failure to include interconnecting utilities in the PSM-covered
process and PHA review process (e.g., steam, nitrogen, cooling
water, etc.)
Any possible solutions to this problem?
SOLUTION: Redline/mark PSM-covered process

boundaries on Facility Plot Plan AND process P&ID(s)
AND Communicate

26
Common Deficiencies
Process Safety Information
• Hazardous effects of inadvertent mixing of different chemicals

that could foreseeably occur not addressed
• Lack of complete Electrical Area Classification
documentation and field survey
• Design basis information for emergency relief/PSV and flare
systems incomplete (e.g., API RP520/521 RV sizing
“contingency analysis ” and flare analysis)

27
Common Deficiencies
• Design basis information for safeguards, which prevent
or mitigate a potential release, incomplete (e.g., fire
water systems).
• Materials of construction information not on file for all
equipment in the “covered process”.
• Lack of reference Plant design codes and standards
identified (“RAGAGEP”).

28
Common Deficiencies
Standard Title
API 520 Sizing, Selection & Installation of Pressure-Relieving Devices in
Refineries
API 521 Pressure-Relieving and Depressuring Systems
API 752 Management of Hazards Associated with Location of Process
Plant Permanent Buildings
API 753 Management of Hazards Associated with Location of Process
Plant Portable Buildings
API 510 Pressure Vessel Inspection Code – In-service Inspection,
Rating, Repair and Alteration
API 570 Piping Inspection Code – In-service Inspection, Rating, Repair
and Alteration of Piping
API 574 Inspection Practices for Piping System Components
ANSI/ISA Functional Safety – Safety Instrumented Systems for the
S84.01 Process Industry Sector
29
Common Deficiencies
Process Hazard Analysis
• PHA fails to comprehensively identify all hazards of the
process because:
• Selection of the wrong methodology based on
complexity of the process
• Incomplete set of Guidewords + Parameters
(“Deviations”) utilized
• Failure to review Startup / Shutdown issues,
Abnormal Operations

30
Common Deficiencies
• PHA performed in the absence of at least one employee
who has experience and knowledge specific to the
process being evaluated.
• Failure to assess consequences to “ultimate” loss event
assuming safeguards are non-existent or ineffective as
designed.
• Safeguards not independent of the initiating event /
cause. Failure to perform Layer of Protection Analysis
(LOPA) to assess effectiveness of safeguards.

31
Common Deficiencies
• Previous incidents, including “near
misses”, not considered by the PHA
team.
• Overdue PHA recommendations with
no managed schedule for resolution
and completion.
• Incomplete compilation of Process
Safety Information prior to
performing the PHA.

32
Common Deficiencies
• Process hazard analyses were not updated and
revalidated at least every five (5) years.
• Failure to address FACI LI TY SI TI NG issues.
• Failure to address HUM AN FACTORS issues.
USE I N DUSTRY-STAN DARD CHECK LI STS!!!

33
Common Deficiencies – Mechanical

Integrity
• “FIX IT WHEN IT BREAKS” mentality
• Failure to identify “critical equipment” relative to the PSM-
covered process
• Lack of written deficiency management program for non-
conformances identified during inspection and testing activities
• Overdue inspections
• Failure to identify and implement RAGAGEPs for inspections
and tests

34
Common Deficiencies – Mechanical

Integrity
• Failure to review PHA and include all “safeguards” in
Mechanical Integrity program.
• Focus on stationary equipment; less emphasis on
Rotating Equipment and Instrumentation & Controls.
• Lack of “fitness for service” documentation for process
equipment.
• MOC process not used for changes to inspection
frequency.

35
Common Deficiencies
Operating Procedures
• SOPs not written for ALL phases of operation (esp., non-
routine operations, e.g., purging, cleaning, sampling,
temporary operation, emergency operation, etc.)
• Safe operating limits and consequences of deviation from
these limits not well-defined. Steps to correct/avoid
deviations not documented
• No written procedures for Shift Change / Handover
operations
• Lack of annual certification

36
Common Deficiencies – Incident

Investigation
• “Near misses” not recorded; possibly due to:
• Lack of good, uniform understanding of what the definition of a
“near miss”
• Lack of positive culture that promotes reporting of “near misses”
• Focus on reporting and investigation of personnel safety
incidents (a “lagging” indicator) versus “near misses” (a
leading indicator)

37
Common Deficiencies –Training

• Missing records of initial training for qualified operators.
• Refresher training not conducted at least every three (3)
years.
• Lack of verification of personnel comprehension of training
program.
• No written proof that operators were consulted on
frequency or content of refresher training.
• Refresher training too much focused on
“normal” operations.

38
Common Deficiencies – Employee

Involvement
• Lack of well-articulated management expectations and
defined goals; leading to weak employee morale and
decreased employee participation.
• Employees do not know how to access PHAs and other
PSM information.

MaturityModel™

40
Maturity Model
• Based on Levels 1-4 where 1 is
Level Definition
Reactive and 4 is Optimized
(Best-in-Class) 1 Reactive/Initial
• Ability to gauge overall as well 2 Dependent/Defined

as individual PSM element
performance 3 Managed/
Independent
Managed
• Model defines Best-in-Class 4 Optimized/
Safety Management System Interdependent

41
Definition of Levels
Level 3: Managed/
Level 1: Level 2: Level 4: Optimized/
Reactive/Initial Dependent/Defined Independent
Interdependent
Managed
• Immature safety • Structured and • Individuals use wide • Everyone takes
system, procedures documented policies range of tools and proactive approach,
reviewed when with focus on behaviors to care for peer to peer focus,
needed. following procedures themselves with assessment through
• Employer meets less • Good understanding managers taking continuous
than 80% of the of the requirements action when needed. improvement.
criteria developed in outlined in 29 CFR • The employer meets • The employer has
Level 4. 1910.119. at least 90% of the consistently achieved
• The employer meets criteria developed in 98% of the criteria
at least 80% of the Level 4. developed for the
criteria developed in past three PSM
Level 4 audits as certified by
external auditors.

42
Example Checklist for Element PHA

Element Level 1 Level 2 Level 3 Level 4
Process • Hazards inadequately • Procedure developed • Procedure developed • Procedure developed with
Hazard addressed with methodologies with methodologies methodologies including
Analysis • Lack of full team • Subsequent PHAs including LOPA LOPA
member ID and timely updated or • Subsequent PHAs timely • Subsequent PHAs timely
Expertise revalidated updated or revalidated updated or revalidated
• No system to • Employees trained in before 5-year anniversary before 5-year anniversary
promptly address leadership or PHA • Employees trained in • Employees trained in
recommendations participation leadership or PHA leadership or PHA
• Actions not • Pre-formatted participation participation
communicated to industry standard • Pre-formatted industry • Pre-formatted industry
working groups templates used standard templates used standard templates used
• Not timely • Team members and • Team members and • Team members and areas
updated/revalidated areas of expertise areas of expertise of expertise identified
within 5 years identified identified • Comprehensive reports
• Not retrievable • Comprehensive • Comprehensive reports • System to promptly
reports • System to promptly communicate
• System to promptly communicate recommendations
communicate recommendations • Tracking System for
recommendations • Tracking System for actions includes metrics
• PHA revalidated actions includes metrics • Findings/Actions
every 5 years • System to promptly communicated to affected
• Records Retrievable communicate workforce
actions/findings • 5 year PHA schedule
• 5 year PHA schedule developed, reviewed
developed annually for planning and
team assignment

43
Comparison Between Different

Sites/Benchmarking
5 Maturity Score
Level
Target (Best-in-Class)
4 Between 1 (Below Compliance)
C Level 1 & 2
3
Level
A Level 2 2 (Compliance)
2
B Between 3 (Compliance plus)
1 D Level 2 & 3
0 Level 4 4 (Best-in-Class)
Facility
Levels 1-4 where 1 is below par and 4 is
Best-in-Class

44
Summary
• Why is Auditing Important
• Regulatory Requirements
• Common PSM Audit Deficiencies
• MaturityModel™

45
Thank You!

Lessons Learned From PSM Audits: Presenters: Carolina Del Din May 23, 2018

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Lessons Learned from

Presenters: Carolina Del Din

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Lessons from the Past

Flixborough 1976 Three mile

Copyright © 2017 PSRG Inc.

Process Safety Regulations

• 29 CFR 1910.119, OSHA Process Safety Management

• 40 CFR Part 68, EPA Risk Management Program Rule

Copyright © 2017 PSRG Inc.

Are the Regulations Working?

What is Being Done?

• EPA revised the RMP Rule

Copyright © 2018 PSRG Inc.

Compliance Audit – Why?

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

1. Employee Participation 8. Mechanical Integrity

Copyright © 2018 PSRG Inc.

Processes & Chemicals Covered

Copyright © 2017 PSRG Inc.

• 1910.119(o)(1), 68.79(a): Employers shall certify that they

Copyright © 2017 PSRG Inc.

• 1910.119(o)(4), 68.79 (d): The employer shall promptly

Copyright © 2017 PSRG Inc.

What the Facility and/or Company

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Contractors Mechanical Integrity

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Common Deficiencies - BASIS

• 350+ audits / assessments performed

Copyright © 2018 PSRG Inc.

Site Walk-through Observations

Copyright © 2018 PSRG Inc.

Site Walk-through Observations

Lack of Hazard Communication Signage

SOLUTION: Redline/mark PSM-covered process

Copyright © 2018 PSRG Inc.

• Hazardous effects of inadvertent mixing of different chemicals

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

USE I N DUSTRY-STAN DARD CHECK LI STS!!!

Copyright © 2018 PSRG Inc.

Common Deficiencies – Mechanical

Copyright © 2018 PSRG Inc.

Common Deficiencies – Mechanical

Copyright © 2018 PSRG Inc.

Copyright © 2018 PSRG Inc.

Common Deficiencies – Incident

Copyright © 2018 PSRG Inc.

Common Deficiencies –Training

Copyright © 2018 PSRG Inc.

Common Deficiencies – Employee