Jeff Baker, Lloyd’s Register – Asia: FLNG Facilities – A regulatory and classification viewpoint

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Jeff Baker, Energy Compliance, Integrity and Inspection Manager, Australasia, Lloyd’s Register – Asia delivered this presentation at the 2013 FLNG Forum in Perth. The two day conference brings attendees key insights into the technology and concepts that will unlock Australia’s stranded gas reserves. This event brings together case studies, keynote and technical presentations from the experts at the forefront of the Floating LNG projects. For more information about the forum, please visit the event website: http://www.informa.com.au/flngforum2013

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Jeff Baker, Lloyd’s Register – Asia: FLNG Facilities – A regulatory and classification viewpoint

  1. 1. Lloyd’s Register services to the energy industry FLNG Facilities – A Regulatory and Classification Viewpoint. FLNG Forum 4th December 2013 Jeff Baker, Energy Compliance Technical Manager Australasia Lloyd's Register International (Reg. No. 6676406) is a Company Limited by Guarantee registered in England and Wales. A Charity (Reg. No. 1151987) registered in England and Wales by the Charity Commission. Registered Office: 71 Fenchurch Street, London, ECM3M 4BS, UK. A subsidiary of Lloyd's Register Group Limited. Lloyd's Register Group Limited, its affiliates and subsidiaries and their respective officers, employees or agents are, individually and collectively, referred to in this clause as 'Lloyd's Register''. Lloyd's Register assumes no responsibility and shall not be liable to any person for any loss, damage or expense caused by reliance on the information or advice in this document or howsoever provided, unless that person has signed a contract with the relevant Lloyd's Register entity for the provision of this information or advice and in that case any responsibility or liability is exclusively on the terms and conditions set out in that contract.
  2. 2. Lloyd’s Register services to the energy industry Agenda Introduction • Introduction to LR • A summary of Australian offshore regulatory requirements as administered by NOPSEMA, including notes on the various Australian States and Territories Regulators. LR experience in interpreting the Regulations: • Validation, Verification, Classification and Flag and how they relate to each other. • Conflict of Interest and how to avoid it. • Recognition of the activities of other independent parties • Management of Validation, Verification, Classification and Flag LR FLNG Rules: • Current and planned releases. • Technical issues.
  3. 3. Lloyd’s Register services to the energy industry Introduction to Lloyd’s Register Lloyd’s Register (LR) is a global engineering, technical and business services organisation wholly owned by the Lloyd’s Register Foundation, a UK charity dedicated to research and education in science and engineering. Founded in 1760 as a marine classification society, LR now operates across many industry sectors, with over 9000 employees in 78 countries. LR has a long-standing reputation for integrity, impartiality and technical excellence. Our compliance, risk and technical consultancy services give clients confidence that their assets and businesses are safe, sustainable and dependable. Through our Global Technology Centres and research network, LR is at the forefront of understanding the application of new science and technology to future-proof our clients’ businesses. Sustained presence in Australia since 1871, and operating in the Australian Energy Market since 1955
  4. 4. Lloyd’s Register services to the energy industry Lloyd’s Register Organisation • Four global business divisions: • Marine • Energy • Transportation • Management Systems (LRQA) Lloyd’s Register Foundation Lloyd’s Register Group Ltd. Management Systems Transportation Energy Marine
  5. 5. Lloyd’s Register services to the energy industry Energy Services Organisation Group CEO Richard Sadler Global services structure, providing full range of services to upstream, downstream, power and manufacturing sectors. Energy Director John Wishart Consulting Drilling Asset Integrity Inspection Compliance Five operating divisions with one overarching Technology function. Recent acquisition - Senergy.
  6. 6. Lloyd’s Register services to the energy industry Energy Services & Project Lifecycle
  7. 7. Lloyd’s Register services to the energy industry LR Major Offshore Projects Experience in Australia & NZ Project Name Company Type Bayu Undan (LPG FSU Liberdade) ConocoPhillips LPG FSO Internal, permanent turret Bayu Undan CUQ, CPP, WP1 ConocoPhillips Fixed Facilities, Pipelines BassGas Yolla Clough/Origin Fixed platform, Pipeline Enfield (Nganhurra FPSO) Woodside FPSO External, disconnectable turret Otway (Thylacine) Woodside Fixed Platform, Pipeline Kupe Origin NZ Fixed Platform, Pipeline Maari OMV NZ/Clough Fixed Platform. Angel Woodside Fixed Platform, Pipelines Vincent (Ngujima-Yin FPSO) Woodside (Maersk) FPSO Internal, disconnectable turret Montara PTTEP Fixed Platform, Pipelines Van Gogh (Ningaloo Vision FPSO) Apache (Prosafe Production) FPSO Internal, disconnectable turret Kitan (Glas Dowr FPSO) ENI (Bluewater) FPSO Internal permanent turret NR2 (NRB and NRA relifing) Woodside Fixed Platforms Prelude FLNG Technip/Shell FLNG Internal permanent turret Balnaves (Armada Claire) FPSO Apache/ Bumi Armada FPSO External, disconnectable turret Coniston Apache Subsea, Pipeline Gorgon Upstream and in-plant scopes Chevron/GUJV/KJV Subsea, Pipelines and reception facilities
  8. 8. Lloyd’s Register services to the energy industry Australian Safety Regulations Summary 1 of 3 NOPSEMA’s Legislation and Regulations web link: http://www.nopsema.gov.au/legislation-and-regulations/ For offshore “facilities” there may be Commonwealth, State, Territory (or Timor Sea JPDA) waters requirements applicable to location of the particular facility. For facilities in Commonwealth waters the applicable safety regulations are: Offshore Petroleum & Greenhouse Gas Storage (Safety) Regulations 2009 - OPGGS(S)R. AMSA requirements for Offshore facilities web link http://www.amsa.gov.au/
  9. 9. Lloyd’s Register services to the energy industry Australian Safety Regulations Summary 2 of 3 – Key Requirements For new offshore facilities (and for significant modifications to existing facilities), the regulations generally require • A new safety case, or modifications to an existing safety case. • For OPGGS(S)R, a “Validation”, conducted by an independent competent party, where required by the Regulator. Verification (and, where applicable, Classification) activities are required in addition to support the safety case (and these activities effectively underpin Validation). NOPSEMA’s Validation web page: http:// www.nopsema.gov.au/safety/safety-case/validation/
  10. 10. Lloyd’s Register services to the energy industry Australian Safety Regulations Summary 3 of 3 Aims of the Safety Case Regulatory Regime To provide an alternative documented system to a ‘prescriptive’ rulebook of National Regulations, by requiring the Operator to prepare a Safety Case (incorporating a Formal Safety Assessment) for the full life of the Facility, including: • Identify Hazards and resulting MAEs. • Set in place a process for the Identification of barriers to MAEs (defined by NOPSEMA as Control Measures, which in turn include SCEs). • Provide assurance of the suitability and consistency with the FSA of SCEs, by reference to agreed, codes, standards, rules, regulations and technical analyses. • By means of the above, drive risks to ALARP • Ensure suitable examination regimes are implemented to confirm compliance with the Safety Case and thus suitability of the facilities to be brought into use and remain in operation (includes both Validation and Verification). Thus establish a baseline for Safety for the full life cycle management of the facility.
  11. 11. Lloyd’s Register services to the energy industry Validation NOPSEMA’s Validation Guidelines N-04200-GL0525, provide an explanation, including the following key items. • Validation definition versus verification (the latter being clarified as required as part of the safety case) • Formal “Scope of Validation” required by NOPSEMA • Selection and agreement of codes and standards to be used • Validation deliverables • Validation sequencing versus safety case • Relationship of Classification to Validation • Independence of the Validator and Conflict of interest policy
  12. 12. Lloyd’s Register services to the energy industry Scope of Validation (SOV) document NOPSEMA require a “Scope of Validation” to be presented for their agreement before a Safety Case can be submitted. The Plan should include: • Overview of the facility. • The selection and competence of Independent Validation Body (IVB). • The identification and recording of Major Accident Events (MAEs and Safety Critical Elements (SCEs). • Establishing the performance standards for SCEs (possibly including listings of likely codes and standards to be used). • General methodology for conducting the Validation of the SCE’s. • Credit taken for other Independent Body activities. • Reporting of the findings of the document reviews and recording of the remedial actions associated with these examinations. • Issuance of final deliverables (Validation Report and/or Statement).
  13. 13. Lloyd’s Register services to the energy industry What does the Validator need to do? • Review the “Formal Safety Assessment”, including selected Risk Analyses • Review List of Safety Critical Elements and associated design, construction and installation Codes and Standards (which may or may not include formal Performance Standards, since these are not mandatory for design) . • Full review of Basis of Design, high level specifications and philosophies for design, construction and installation to ensure the specified codes and standards for each SCE have been carried through and correctly interpreted into the top level of the design. • Review selected detailed design, construction and installation deliverables (drawings, analyses, datasheets, etc) to further ensure application of the specified codes and standards to the level of detailed design (should include documents defining how the specified codes and standards will be implemented in construction and installation). • Prepare and issue a Validation Report and/or Statement on completion.
  14. 14. Lloyd’s Register services to the energy industry Validation Deliverable A statement in writing by an independent validator regarding the agreed matters (design, construction, installation) to the extent covered by the scope of validation developed by the operator and agreed by NOPSEMA. If the SOV is sufficiently well defined this can be a simple “Validation Statement”, but if not a “Validation Report” may be needed. As per NOPSEMA Guidance Notes to Validation N-04200-GL0525 the deliverable of Validation should be assurance that: a) For all safety critical elements covered by the agreed scope of validation, the design, construction and installation codes and standards applied in relation to a facility are appropriate; b) That if these codes and standards are used then the design, construction, and installation of the facility will incorporate measures that will protect the health and safety of person at the facility and are consistent with the formal safety assessment for the facility, where appropriate.
  15. 15. Lloyd’s Register services to the energy industry Verification, Classification and Flag • • • • Current NOPSEMA guidance makes the distinction that the process of physically checking the design, construction, installation and commissioning of a facility for compliance with agreed codes and standards and against formal safety assessment requirements is a separate activity from Validation. This process is required to establish the final compliance of the facilities with the formal safety assessment as a part of the safety case and is termed verification in NOPSEMA guidelines. Classification and flag state requirements are suitable codes and standards in their own right and certification against these can be regarded as a form of verification. Independent verification and classification activities can deliver Validation, provided independence from project design, construction and installation activities is maintained by the body concerned.
  16. 16. Lloyd’s Register services to the energy industry What is the relationship between Validation, Classification & Flag? “When agreeing the scope of validation for facilities subject to marine classification, the marine classification certification may be accepted as providing the reasonable level of assurance that those elements of the vessel to which they apply incorporate measures to protect the health and safety of the facility, as required by the regulations. “ (NOPSEMA Validation Guideline, Ref. N-04200-GL0525) • Class and Flag (IMO) requirements go hand-in-hand. • The hull and the primary marine systems will be included in list of Safety Critical Elements (SCEs) - however, it is likely that classification and Flag will not capture all SCEs • Class Rules are a suitable hull and machinery performance standard recognised by regulators, financiers and marine underwriters
  17. 17. Lloyd’s Register services to the energy industry Classification and Flag as Performance Standards Class rules and IMO regulations will help to address the following primary concerns: • Is the hull strong enough to withstand all foreseeable loads, considering it will be in a fixed location? • Is the hull design tough enough to withstand the high and low cycle fatigue loadings? • Will the containment system achieve the required service life free from failure • In the event of a major incident, are there adequate means of protecting personnel, allowing them to escape and ultimately to evacuate the installation • Will the hydrodynamic performance protect the topside equipment from green water and from undue loadings? • Can the unit maintain a benign orientation for efficient cargo offtake? • Navigation (propulsion and steering) for disconnectable vessels.
  18. 18. Lloyd’s Register services to the energy industry What is included in Classification and Flag • Hull Structures and Cargo Containment Systems. • Topsides Supports structure/Interface (Strength/Fatigue). • Mooring System. • Essential marine equipment (bilge, ballast, power, propulsion and steering). • Fire Protection, Active and Passive. • Marine essential Emergency generators and UPS. • Essential marine Shutdown, Control and Detection Systems. • Stability, Intact and Damaged. • Control of discharges (MARPOL) • Navaids, helidecks. • Life Saving equipment, PPE, escape and evacuation. • Essential marine cranes and lifting appliances. • There is an optional class notation for Topsides Process Plant, Production Risers, Offloading systems, non-essential Control Systems, Cranes and lifting appliances,
  19. 19. Lloyd’s Register services to the energy industry Are Classification and Flag Mandatory?  For permanently moored floating facilities, Classification & Flag are not currently mandatory on station, however they are mandatory for disconnectable vessels.  AMSA as the responsible coastal state require the installation to remain registered and compliant with the environment focussed requirements of MARPOL regardless of the Flag status of the facility.  During tow, any free floating FOI will require Flag and Classification if manned by more than a minimum tow “riding crew” (e.g. if a commissioning crew is on board). May trigger a requirement for specific marine personnel manning, ISM and ISPS requirements.  Flag State “Marine Orders” will apply, but concessions and exemptions can be granted by the Flag State, with LR support (e.g. Bridge visibility forward and navaids).  LR recommends that the installation should be Classed and maintained in Class in order to ensure a suitable standard for hull and marine systems is demonstrably maintained.
  20. 20. Lloyd’s Register services to the energy industry Harmonising Classification Rules with the Regulatory Regime – LR Risk based Classification Approach LR supports a Risk-based approach to offshore facilities, in the “LR Rules and Regulation for the Classification of a Floating Offshore Installation at Fixed Location” part 1A: • Risk assessment may be used to define the basis of classification, by: • (a) identifying the hazards to safety and integrity of the installation, and evaluating them considering both consequence and frequency; • (b) identifying systems or elements of the installation that are critical in relation to the hazards; and • (c) defining performance standards which the critical systems or elements must meet to prevent, detect, control, mitigate or recover from, the identified hazards.
  21. 21. Lloyd’s Register services to the energy industry Validator “Conflict of Interest” In their guidelines, NOPSEMA require that: “The validator must be sufficiently independent to form an impartial opinion on the matter.” And: “Note: a validator working for an operator or an organisation involved in the design, fabrication or installation of the validated equipment (even if the validator is working in a unit separate to the design, fabrication or installation division, department or branch etc), is not considered sufficiently independent.” • LR is confident that a combination of Validation, Verification and Classification can be delivered without COI by ensuring we do not guide the Operator or EPC to a particular solution • LR cannot Validate its own work so all work must be an independent activity undertaken to check the work of the Project. • LR has delivered all three services on many occasions in the past
  22. 22. Lloyd’s Register services to the energy industry What about the activities of other independent parties? NOPSEMA appear to prefer a single Validation Body for a particular project. If the Operator has assigned responsibility for independent Validation or verification to their EPCs, more than one independent body may be appointed, which may in turn lead to the need for an “Overarching Validator” to assess the overall result. These questions need to be asked: • Does the overall scope of work cover all SCEs for the facility without gaps? • Is the scope of work for each body consistent with the SOV (can it be credited)? • Is the scope of work carried out to suitable level of detail and thoroughness? • Are all the bodies truly independent (no COI arising) Work by IACS bodies – the big 4 - LR, DNV, ABS, BV is generally mutually acceptable. Work by other established and reputable inspection bodies (e.g. pressure vessel and lifting appliance IIA) is also accepted but subject to more scrutiny. Work by other organisations will need more thorough assessment.
  23. 23. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units The background: • In 1764, LR published it’s first “Register of Ships” which gave both underwriters and merchants information on the condition of the vessels they insured and chartered. • To ensure that the LR inspections were non-subjective we formulated Rules for all aspects of a ships hull and equipment. When a ship met the requirements of the Rules it became “Classed”. For today’s Energy assets: • Our Rules and Regulations set appropriate standards for the design, construction and lifetime maintenance of offshore units of all types. • To keep pace with changes in technology, market trends and new legislation, we are dedicated to an on-going programme of research and development to enhance existing technical standards and publish updates or new Rules every year.
  24. 24. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units Using the rules and gaining an appropriate Classification notation gives: • A designer, yard or operator access to procedures, methodologies , software and an unrivalled knowledge base of technical experts • An operator the assurance that an offshore unit meets recognised requirements to maintain essential services on board. • A standard for hulls and machinery recognised by all offshore Regulators including NOPSEMA, all Flag States including AMSA, by financiers and by Insurance Underwriters. • An offshore unit the ability to trade or transit in International waters.
  25. 25. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units There are currently two Offshore Rule-sets: The Rules for Floating Offshore Installations at a Fixed Location, Released June 2013 Covering FPSO, FSO, FPU and FLNG complemented with Guidelines for the Calculation of Probabilistic Explosion Loads. The Rules for Mobile Offshore Units, Released June 2013 Covering MODU, accommodation units, tender rigs, fire-fighting units, heavy lift vessels etc.
  26. 26. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units Guidance notes, procedures and software in support of the Rules Rules Prescriptive Requirements Guidance Procedures Software Asset or subject based client 1. Methodology to assess the strength & Software to assess the strength & guidance to clarify or expand fatigue of the hull structure of units fatigue of the hull structure of units on the Rules. against LR Class requirements. against LR Class requirements. 2. Survey Procedures.
  27. 27. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units The Governance process for updating the rules The Rules are continuously reviewed, updated and developed by LR and approved by the Lloyd’s Register Technical Committees, based on • • • Currently accepted and leading edge engineering principles Proven industry best practice Empirical feedback from the performance of assets in service Our Offshore Technical Committee includes Drilling Operators, Engineering, Procurement & Construction companies, Lease Operators, National & International Oil Companies, Regulators, Universities, Yards & Vendors
  28. 28. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units
  29. 29. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units What’s new and planned in the Rules? A phased approach to the rules updates: Phase One - Already Published June 2013 Phase Two - To be published July 2014 Phase Three - To be advised - July 2015
  30. 30. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units What’s new in the Rules? - Phase One FLNG Floating Liquefied Natural Gas units • Using the IMO IGC code as the base document we added LR’s hull structure requirements along with other best practice requirements from our Gas ship Rules • Using project experience the discipline engineers analysed the IGC Code and removed content not relevant to FLNG units., adapting requirements for application to FLNG, replaced requirements with offshore best practice and kept requirements considered best practice • The IGC Code covers 38 different liquefied gases with many gas specific requirements, most of the gases are not relevant to FLNG. Our FLNG Rules incorporate only the requirements for the gases applicable to FLNG, namely Methane, Ethane, Propane, Butane, Pentane, Nitrogen and Carbon Dioxide (carbon capture storage) • The reduction to LNG, LPG and CO2 also permits the reduction of the four IGC Code ship types to one; Ship type 2G moderately toxic liquefied gases (LNG/LPG)
  31. 31. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units What’s new in the Rules? - Phase One FLNG Floating Liquefied Natural Gas units • To avoid misapplication the requirements specific to re-gas ships have been removed for the FLNG Rules. Lloyd’s Register is developing separate Rules for use with re-gasification facilities. • As an International Certificate of Fitness is not required, the related IGC code statutory survey procedure and requirements have been removed. For FLNG statements of compliance will be project specific. • 10,000 year return period wave loading has been added as a design case for the gas containment system. • The environmental design temperatures adopted by the IGC Code have been replaced with site-specific temperature requirements. This approach aligns with offshore design philosophy. • Prescriptive requirements for hazardous areas have been made goal based to address the identified risks and to allow the facility to be treated as whole entity rather than a serious of unrelated modules. •
  32. 32. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for the Classification of Offshore Units What’s planned in the Rules? - Phase Two The current MOU rules have 8 parts, much of which is also contained in the FOIFL rules. This is why Phase 2 will be rolled out as an amalgamation of The Rules for Floating Offshore Installations at a Fixed Location and The Rules for Mobile Offshore Units . o form one rule-set:
  33. 33. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units What’s planned in the Rules? - Phase Two FLNG • • • • • • • • • Floating Liquefied Natural Gas units Update of corrosion requirements Addition of software to calculate hull loads from cyclonic data Release of guidelines for collision loads, dropped objects and fire loads Guidelines on establishing acceptance criteria for risk based design methodology to calibrate partial safety factors for ultimate strength assessment Updated Ship-Right Procedure Requirements for High Voltage Systems, Earthing, Emergency Shutdowns, Alternate Arrangements of emergency power, Quick Disconnect systems Requirements for cryogenic spill Offloading requirements
  34. 34. Lloyd’s Register services to the energy industry Lloyd’s Register’s Rules for Offshore Units Where can I find more information? Webstore Download soft copies of all of Lloyd’s Register’s Rules and receive subscribers update Download soft copies of Procedures Order hard copies of the Rules (from July 2014) LR.org Download soft copies of all of Lloyd’s Register’s Rules Download soft copies of Procedures Find related guidance Email: OffshoreRules@lr.org
  35. 35. Lloyd’s Register services to the energy industry Thank you for your attention. Any questions?

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