Certain installations warrant special consideration in a risk assessment. An HDD is a good example. As a non-routine, more expensive, more protected, and more challenging type of installation, the HDD has several key differences in risk from a conventionally installed pipeline segment.
A life-cycle risk assessment (RA) is appropriate for HDD pipeline segments, with separate monetized risk values generated for each pipeline at this HDD installation. Two types of risk are assessed. One is defined as any significant issue arising during installation that results in significantly more costs than anticipated—installation risk. The other is defined as a leak or rupture of an operating pipeline segment—operational risk. Both are monetized, i.e., risk is expressed in terms of potential dollars loss.
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Life Cycle Risk—An HDD Example
Life Cycle Risk—An HDD Example
In previous articles, we’ve discussed some non-regulatory-IMP applications of pipeline risk assessment (due diligence, portfolio management, strategic risk planning, etc)
In this article, let’s examine a risk assessment application slightly-expanded from a conventional operational risk assessment.
A life-cycle risk assessment (RA) can generate risk estimates for, in our case, two phases of an asset’s life. Each requires a definition of ‘failure’ for which risk is being assessed. One failure is defined as any significant issue arising during installation that results in significantly more costs than anticipated—installation risk. The other is defined as a leak or rupture of an operating pipeline segment–operational risk. Both risks are monetized, as regular readers will recognize our preferred way to measures risk, i.e., risk is expressed in terms of potential dollars loss.
Each failure definition generates consequence scenarios. Consequences, or ‘costs’, associated with ‘failures’ as defined above are estimated under two main categories as 1) potential receptor damages during long term operations and 2) losses to owner/operator during installation. Included are scenarios involving installation damages that may manifest as operational failures long after operations begin.
There is overlap since all receptor damage scenarios generate consequences to owner/operator and some of the installation scenarios may eventually contribute to receptor damages (via leak/rupture scenarios).
A framework for HDD installation risk could evaluate ‘failure’ scenarios that fall into 3 three general categories of loss (additional and unplanned costs):
- Re-drill HDD, where a full or partial re-drilling is required but does not include reinstallation of pipe.
- Re-install the HDD, where installation issues are so severe that a full re-installation is required.
- Other Installation Incidents (where unanticipated actions are required, including where obstacles, errors, or inefficiencies are encountered that do not require re-drill or re-install but nonetheless generate additional costs.
Installation errors/failures involve numerous potential scenarios, each with varying probabilities and consequences. They emerge from either design phase or execution phase errors. Cost exceedances including time delays, re-work, and others are often the most common consequences. Examples of re-work include conducting addition soil investigations, re-design, re-bore, and others. Property damages, legal costs, and increased regulatory requirements are additional potential consequences.
Both types of risk –installation and operational–are expressed in units of $/year. A significant change in risk is anticipated at the point where the installed pipeline segment begins operations–ie, is placed into hydrocarbon transportation service. This is seen in the profile of risk vs time.
Life cycle risk assessment illustrates important nuances for segments such as an HDD installation. Despites its many benefits, there are also some interesting risk implications of long term ownership. An HDD installed pipeline segment has risks unique from its conventionally installed neighboring segments. Many of the differences in risk are directly related to the installation itself. The differences appear in both probability of failure (PoF) and consequence of failure (CoF) potential.
PoF Issues
- Installation
- Precise location of neighboring pipelines/utilities
- Contractor methods to be utilized
- Potential for hydraulic fracture
- Operations
- Increased depth reduces certain threats
- Inability to perform certain mitigations
- Possible installation weaknesses
CoF Issues
- Inability to repair HDD crossings—i.e., higher frequencies of replacements if defects occur during operations of if neighboring facilities are contacted
- High replacement costs of HDD crossings
The differences in risk will impact costs of ownership and should be considered. If assessing a yet-to-be-installed segment, pre-installation uncertainty will play a role. A risk assessment may have to make assumptions around installation issues pending final regulatory approval and installation contractor choices. For example, a regulator and/or the installer must make choices related to the specifics of how the installation and quality assurance will be performed. These choices are made in the context of incomplete knowledge of subsurface conditions. ‘Incomplete’ since, despite normal geotechnical investigations, much will still be unknown.
There are unique perils associated with an HDD installation. Unlike the conventional installations, if even minor contact is made with a deeply buried neighboring asset while drilling, consequences can be dramatic, eg, the cost of replacing the neighboring asset. Similarly, an HDD installation may place pipe and welds under stresses that would not occur in convention installation, perhaps introducing weaknesses manifesting as contributors to future failures. Of course there are mitigation measures available to at least partially offset any increased failure potential. But, consistent with good RA practice, a mitigated threat is never as ‘safe’ as a non-existent threat.
This in no way suggests that HDD installation are not valuable. A non HDD installation thru the same area could be prohibitively expensive, requiring sometimes impractical re-routes and greater risks. But understanding the risks allows optimum decision-making.
Preliminary risk estimates will often appear high for HDD installations compared to conventional installations. The higher risks will likely be due to the issues previously noted, especially the increased CoF costs. In a recent assessment, preliminary estimates of installations risk showed that expected losses were about 7% of installation costs. This means that an installation cost of $100/ft actually carries a cost of $107/ft initially, and on-going risk costs that may exceed those of a conventional installation.
Total life-cycle risk is the sum of installation risk and operations risk. Both are measured in terms of Expected Loss (EL) which is a function of PoF and CoF and expressed in monetary units. Annualizing the installation risk (over , say, 30 years) and combining with the operational risks per year allows comparisons with other pipeline segments. Recall that these ‘annualized potential losses’ are a measure of risk and should be viewed as being additive to costs of installation, operations, and maintenance.
Operational risks (after installation, while transporting product) may also be higher for HDD segments, for reasons linked to those differentiating installation risks. An operational risk assessment must take care to include all failure modes. For instance, a focus solely on rupture incidents usually results in very low failure frequencies for many threats. Analyses may show that the external corrosion rupture frequency carries extremely low incidence rates (when the focus is solely on rupture, ignoring leak potential). This may cause an important aspect to be missed: the expensive proposition that the HDD installation must be replaced, even if damage would be repairable in most other segments. Rupture is not a reasonable sole basis for RA on pipelines installed by HDD.
Once risk estimates are finalized, many opportunities exist to reduce PoF risk in both installation and operational risk, should risks be deemed unacceptable. There are fewer opportunities to reduce CoF risk in HDD installations.
For a good summary of the HDD process, consider this advertising blurb from Technical Toolboxes course advertisement:
Horizontal Directional Drilling – Coverage of HDD Technologies for Pipeline and Utility Application – 13 hours
Instructor: David Willoughby – Director of Energy and Corrosion, RKK Ret.
The Horizontal Directional Drilling webinar is offered as a 12-hour webinar that covers Horizontal Directional Drilling (HDD) feasibility analysis and design. This webinar provides technical information on HDD equipment, design, product pipe stress analysis, and construction techniques. The course is geared to provide the student with a thorough knowledge of the HDD basics and transition to an in-depth overview of HDD feasibility and design.
A key aspect of HDD design is determining if crossing an obstacle by HDD is technically feasible. That is, can the proposed crossing be installed using today’s tools and techniques? Technical feasibility is demonstrated primarily by comparing the proposed crossing with previously completed installations. There are many factors to consider when evaluating the technical feasibility of a HDD project. Conducting a site survey, usually the first step is important for all HDD projects and is a significant part of the HDD site characterization. The site survey should include both surface and some level of subsurface investigations. This webinar will cover the basic tasks from a site survey. We will discuss information related to the surface and subsurface feasibility concerns. We will discuss how existing features, both natural and man-made, can impact the way an HDD crossing is configured. We will discuss how the subsurface conditions can impact the various phases of the HDD construction. We will look at the key characteristics such as earth material types, stratification, and groundwater conditions. Also included, are the various aspects of the site’s surface such as the topographic/hydrographic relief and the presence of human activities.
Due to an increasing focus on minimizing environmental impact, it has become standard practice in the HDD industry to evaluate the potential for drilling fluid to inadvertently flow to the surface due to hydro fracture. We discuss methods for evaluating the risk of inadvertent returns due to hydro fracture by comparing the confining capacity of the soils overlying the drilled path to the annular pressure necessary to conduct HDD operations. The course focus will be on HDD with steel and plastic pipelines. The webinar includes design calculations with examples.
- HDD Basics
- HDD Equipment & Tracking
- Subsurface Conditions
- Borehole Stability
- HDD Feasibility
- HDD Design
- Steel Pipe Stress Analysis
- Plastic Pipe Stress
- HDD Workshop & Examples