API 510 recognizes the need to be able to obtain valid inspection results from conducting and external inspection in-lieu of an internal inspection of Pressure Vessels.

1. Managing Your On-Stream
Inspection Program and External
Versus Internal Inspections
Moderator = Ed Merrick, PE – TVA, APTECH
Panelists = Peter Hunt – Engen, Shell, Suncor, Dupont
Frank Simpton – Amoco, Saudi Aramco, Hovensa,
Acuren, Jacobs

2. Introduction
to Augustus
2015
Seminar/Webinar
Series

3. THE AUGUSTUS GROUP, LLC
(AUGUSTUS) – WHO ARE WE?
 Founded in Houston Texas in 2004
 Privately Owned Small Business Registered in SAM
Program
 Engineering and Consulting Services to Refining and
Chemicals and Aerospace Industry for >10 Years
 Focus is on Materials Technology, Asset Integrity Problem
Solving, and Risk Management On and Off Shore
 Collective Experience in……
 Bolting Technology and Leak Management
 Materials Technology, Failure Analysis, Non-
Destructive Examination, Suitability for Service
 Fitness for Service and Risk Based Inspection
 Aerospace, Petroleum and Chemical, Fossil/Nuclear
Power Consulting Upstream and Downstream

4.  Wrote Chemical Manufacturer’s Association’s
Mechanical Integrity Supplement used to Train
Over 300 Member Companies
 >20 RBI Implementations Since 1995,
 First Known Refinery Program at BHP Hawaii,
 NASA Johnson and Stennis AFB
 Developed APTECH’s (Now Intertek) RBI
Program and Software
 Experience with Most Major Software Packages
& Programs – Tichuk, Meridium, PCMS, The
Welding Institute, Capstone, Reliasoft
 Full Scope RBI Implementations
 Using Capstone and PCMS Software
 Management Systems, Procedures, Audits, Training
EXPERIENCE - MECHANICAL
INTEGRITY AND RBI

5. Areas of Specialty Operating Company Former
Employee
Jim Towers Pipelines, Litigation Exxon, Conoco
Peter Hunt Refinery Management, MI/QAQC Shell
Bob Blackstone Stress Analysis, Fracture Mechanics, Welding,
Fatigue, Design
ABS
Gene Rak Corrosion, MI Exxon
Scott Miller NDE Saudi Aramco
Edwin Merrick RBI, Materials Technology, Welding, Bolting, Leak
Management
TVA, Aptech
Scott Merrick Education, Training City of Nashville
Dick Jones Corrosion, PSM, MI, Chemical Plant Management US Steel/ Aristech
Joel Olener PSM
Les Loushin MI, Materials Technology Arco Chemical, Sunoco
Gene Silverman AST Integrity, Eagle System INTANK
Alan Judkins Business Development US Steel/ Aristech
David Sanders Inspection Program Management & Site
Implementation
Petrochem/TEAM
Marvin Mehler Corrosion Engineering NCRA
James Waldrop TA Planning Citgo
Paul Rose NDE, Data Analysis (EVA, etc.)
Mike Fox Maintenance, MI Implementation, Safety Program
Management
Honeywell
Jesse Meisterling Bolting Technology, Leak Management Raymond Engineering
Dave Holthaus NDE Jacobs Engineering
Frank Simpton Inspection Program Management & Implementation,
Corrosion, Damage Management, On-stream
Inspections
Acuren, Hovensa, Saudi Aramco
ENGINEERING CONSULTANTS

6. AUGUSTUS APPLIES TECHNOLOGY
Manufacturing Excellence
Life Cycle
Management
Process
Safety Management
and
Mechanical Integrity
Incident Investigation
Failure Analysis
Acceptability for
Continued Operation
Insurance
Arbitration
Support
and
Litigation

7.  2/19 - Improving your Turnaround
Performance by Managing for Leak Free
Startup – Webinar
 2/26 11am CST, Use Risk Based Inspection
Tools for Optimizing Performance – Webinar
 3/5, 11am CST, Managing Your On-Stream
Inspection Program and External Versus
Internal Inspections - Webinar
 3/12, 11am CST, Managing Corrosion Under
Insulation - Webinar
 3/17 & 3/18 – MI for PSM Compliance
SEMINAR
 MORE TO BE SCHEDULED, CHECK
WWW.THEAUGUSTUSGROUP.NET
WEBINAR/SEMINAR SERIES – HELPING OUR
CUSTOMERS ALIGN WITH BUSINESS OBJECTIVES

8. THE TURNAROUND PROBLEM
 Inspection Plans Typically do not Govern Turnaround
Requirements
 Facility Design Defines What you Can or Have to do On
Equipment
 Reactors on Ultra-formers/Platformers/Hydrogen Plants
 Chemical Plants
 Operational Requirements Govern
 Catalyst Regeneration or
 Change Requirements
 Inspection Manager Typically is or Was Asked - Can Your
Inspection Documentation Support a Delay in the TA?
 Review of Corrosion Data as Baseline for Decision Making – CRs
and Est RUL
 Fitness for Service Calculations to Justify EXTERNAL VS INTERNAL
 Or, What Work has to be Done when Plant is Down

9. SO MANAGEMENT
WANTS YOU TO
MINIMIZE or
OPTIMIZE
TURNAROUND
INSPECTIONS?
OPERATIONS
SAFETY
INSPECTION
MAINTENANCE
SUPERVISOR
ENGINEERING
PLANT
MANAGER’S
OFFICE
ENGINEERING MAINTENANCE OR INSPECTION
MANAGER’s – Daily Challenges

10. WHAT NEXT?
CONTRACTORS???
ENGINEERING MAINTENANCE OR INSPECTION
MANAGER’s – Daily Challenges

11. HISTORICAL PERSPECTIVE ON INSPECTIONS
IN PROCESS REFINING AND CHEMICAL PLANTS
 Late 1960’s
 Did not have the NDE Technology We Have
Today
 Used a lot of RT
 VT of Fire Proofing, Insulation, Structural
Steel, Flange Leaks ...……
 Some Plants used Tell Tale or Sentry Holes
 On-stream Inspections (OSI) was Part of
Maintenance Program
 Terminology in Those Days was Associated
With QA/QC not MI
 Informal Teams were Assembled to Make
Qualitative Decisions on FFS

12. HISTORICAL PERSPECTIVE
 In 1970’s NDE/NDT (e.g. UT) and Documentation
Improved
 Shut-down Standard Practice was to Open
Everything Every 3 Years
 Krautkramer-D Meter Available early-mid 1970’s
 Everything
 Early Program (circa 1962) from SOHIO (Bob
Burrough) bought by Amoco, Chevron, Exxon, etc…
 Used Cobol, (some may have used Fortran) and Punch
Cards to Store your Data
 Calculated CR and est RUL
 Late 1970’s
 Current CR, Est CR, and Short Term and Long Term CR
 Could Est RUL +/- 2 Months on Some Piping
 Today Practice is to Calculate Half Life and Make
Sure Inspections are Done on a Schedule

13. BEST PRACTICE FOR ON-STREAM
INSPECTION PROGRAM MANAGEMENT
 API 510, 570, and 653 Govern
 Today there are UT Couplants that Can Do UT
at Up to 1000F
 Above 650F Take Care re: Safety Issues
 At the Higher Temperatures Take Care with Variables
 Choose your Inspector Carefully and Do Risk Based
Job Safety Analysis
 Standardize Procedure and Documentation
Requirements
 UP to 400F UT Done Routinely

14. Are You Using All
the Available
Tools???
e.g. Advanced NDE,
Fitness for Service,
NDE Data Analysis,
Quality Control/Assurance,
EPRI, API et al
510/570/579/580/581/584
RISK PRIORITIZATION
and/or RISK BASED
INSPECTION
ON-STREAM
INSPECTIONS

15. NUCLEAR POWER
 Early 1970’s ASME Section XI on In-
service Inspection was Beginning to
Take Shape
 Beginning to Use Developing Fracture
Mechanics Technology for Fitness for
Service Management of Problems
 Evolved into API 579, 580, 581, 584
 EPRI and NRC were Key Players

16. RISK PRIORITIZATION AND OR
e.g. RISK BASED INSPECTION
 By Now we’ve all Seen the Customary
Risk Matrix in Some Format
 Do You have a RBI Program?
 Developed and in Place?
 Do You Understand its Potential?
 Are you Using it to Prioritize your Actions and
Deliver on?
 Or Does Your Company Implement a
Qualitative Approach??
 RISK MANAGEMENT IS THE KEY
Consequence Ranking
ABCDE
1
2
3
4
5
ProbabilityRanking
HIGH
MED HIGH
MEDIUM
LOW

17. RISKLEVEL
COST TO REDUCE RISK
RESIDUAL RISK
 Keep it Simple Make Sure You
Identify the OBVIOUS
 RISK ISSUES and
 OPPORTUNITIES
 DEVELOP/EXECUTE ACTION
PLANS FOR IMPROVEMENT
RISK MANAGEMENT IS THE KEY – Align with
Your Business Objectives and Take the Action

18. AUGUSTUS 4-Step
SURGICAL Risk Based Inspection Program
1. Integrate Qualitative Risk Analysis into the
Process Hazard Analysis
This Will Institutionalize Your RBI Program
2. Focus on Quantifying Consequence by Process
System
3. High & Low Consequence Items Quantitative
RBI Analysis
20 - 30% of Your Equipment Gets the Special
Attention it Needs
4. Medium Consequence Items Are Treated in
Conventional Program Manner
**Augustus Uses Our Custom Sharepoint/Reliasoft
Solution To Make It Happen

19. AUGUSTUS 4-Step
SURGICAL Risk Based Inspection Program

20. MI Program
Requirements
OSHA
1910.119(j)
MI Program
and PHA
Requirements
OSHA
1910.119(e) &
(j)
API 580,.
581, 510,
570
API 580,.
581, 510, 570
HIDDEN VALUE FROM RBI
IMPLEMENTATION
Equipment
Data Collection
Process
System
Corrosion
Analysis
Qualitative
Analysis
Data Entry
Quantitative
Analysis
QC and
Equipment
Integrity
Review
RBI Plan
Approval
Action
(Inspections
etc)
Results
Analysis
Criticality and
Plan Update

21. 21
EVALUATE DAMAGE POTENTIAL DURING PHA –
CSB CONCERN AND RECOMMENDATION
PROBABILITY
1 2 3
S 1
E
1 2 3
V
E 2
R
2 4 6
I
T 3
Y
3 6 9
Likelihood = 1- High, 2 - Medium, 3 - Low
Severity (If Undetected) = 1 - Gross Failure or Rupture, 2 -Sub-critical
Leak, Cracking, or Corrosion, 3 - Minor or Pinhole Leak

22. 22
 API 579 Fitness for Service
Analysis - Simple to Complex
 Level 1, subjective expert
judgment based on evidence
 Level 2, simple hand
calculations (e.g. stress,
fracture mechanics,
embrittlement, corrosion rate)
 Level 3, more complex
calculations and tests (material
samples, NDE, finite element
analysis, process stream
samples, probabilistic analysis,
etc.)
REMAINING USEFUL LIFE ANALYSIS TO PREDICT
POTENTIAL FOR FAILURE DURING RUN PERIOD

23. QUALITATIVE RISK MATRIX FOR
EVERYDAY USE
 At Every Management
Level
 Best Practice is to Manage
Based on Risk
 Situational Decision
Making
 Inputs
 Your RBI Program Data
 Results from a Qualitative
Review During the PHA

24.  PLANT MANAGER’S SECRETARY – There is an
emergency. The toilet is plugged…
 Risk Ranked – High!!!
 Action – Rush mechanic immediately!!!
RISK MATRIX – Applications

25. CONSEQUENCES
MAJOR Fatality or Disabling Injury, Major fire/explosion
requiring off-site response, Toxic/flammable gas release,
Permit exceedance or RQ release of chemicals to air, water
or ground, Production loss (unit shutdown or partial) > 24
hrs, Repair costs >$100K
1
MODERATE OSHA recordable Injury, Minor fire/explosion
requiring plant fire brigade/ERT response, Minor release of
chemicals to air, water or ground requiring ERT response,
Production loss (unit shutdown or partial) between 12 and
24 hrs, Repair costs between $50K to $100K
2
MINOR First aid injury, Local fire requiring operator
response only, Minor release of chemicals to air, water or
ground manageable by routine staffing, Production loss
(unit shutdown or partial) less than 12 hrs, Repair costs
between $10K to $50K
3
NEGLIGIBLE No health, safety and environmental
impact, Minor recoverable production loss, Repair costs < $
10K
4
MOST CRITICAL LESS CRITICAL
CRITICAL LEAST CRITICAL
ASSET CRITICALITY LIKELIHOOD OF FAILURE
E D C B A
Extremely
Unlikely
Unlikely Possible Some
what
likely
Very Likely
Reliability
Excellent
> 5 yrs
Reliability
– Good
3–5yrs
Reliability –
Fair
1–3 yrs
Reliability
– Poor
1 yr
Reliability
Very Poor
<1 yr

26. CONSEQUENCES
MAJOR Fatality or Disabling Injury, Major fire/explosion
requiring off-site response, Toxic/flammable gas release,
Permit exceedance or RQ release of chemicals to air, water
or ground, Production loss (unit shutdown or partial) > 24
hrs, Repair costs >$100K
1
MODERATE OSHA recordable Injury, Minor fire/explosion
requiring plant fire brigade/ERT response, Minor release of
chemicals to air, water or ground requiring ERT response,
Production loss (unit shutdown or partial) between 12 and
24 hrs, Repair costs between $50K to $100K
2
MINOR First aid injury, Local fire requiring operator
response only, Minor release of chemicals to air, water or
ground manageable by routine staffing, Production loss
(unit shutdown or partial) less than 12 hrs, Repair costs
between $10K to $50K
3
NEGLIGIBLE No health, safety and environmental
impact, Minor recoverable production loss, Repair costs < $
10K
4
LIKELIHOOD OF FAILURE
E D C B A
Extremely
Unlikely
Unlikely Possible Some
what
likely
Very Likely
Reliability
Excellent
> 5 yrs
Reliability
– Good
3–5yrs
Reliability –
Fair
1–3 yrs
Reliability
– Poor
1 yr
Reliability
Very Poor
<1 yr
Emergency Work Start
Immediately; OT
approved
Routine Priority < 3 wks
Urgent Priority – Within 1
week
When resources are
available; within 6 months
WORK SCHEDULING

27. CONSEQUENCES
MAJOR Fatality or Disabling Injury, Major fire/explosion
requiring off-site response, Toxic/flammable gas release,
Permit exceedance or RQ release of chemicals to air, water
or ground, Production loss (unit shutdown or partial) > 24
hrs, Repair costs >$100K
1
MODERATE OSHA recordable Injury, Minor fire/explosion
requiring plant fire brigade/ERT response, Minor release of
chemicals to air, water or ground requiring ERT response,
Production loss (unit shutdown or partial) between 12 and
24 hrs, Repair costs between $50K to $100K
2
MINOR First aid injury, Local fire requiring operator
response only, Minor release of chemicals to air, water or
ground manageable by routine staffing, Production loss
(unit shutdown or partial) less than 12 hrs, Repair costs
between $10K to $50K
3
NEGLIGIBLE No health, safety and environmental
impact, Minor recoverable production loss, Repair costs < $
10K
4
TURNAROUND
MUST DO
NOT
NECESSARY
SHOULD DO
NEVER
JUSTIFIED
LIKELIHOOD OF FAILURE
E D C B A
Extremely
Unlikely
Unlikely Possible Some
what
likely
Very Likely
Reliability
Excellent
> 5 yrs
Reliability
– Good
3–5yrs
Reliability –
Fair
1–3 yrs
Reliability
– Poor
1 yr
Reliability
Very Poor
<1 yr

28. REVIEW OF API 510 PARA. 6.5…
 Conventional Program
 No Cracking Mechanisms
 Data to Substantiate Low Corrosion Rate
 Process has been Consistent and is
Stable
 RBI Analysis Can be Used to Manage
Decisions

29. EXPERIENCE WITH API 510
PARAGRAPH 6.5….
1. HF Alky Tower Fitness for Service Calculation to
Run Additional Six Months - $MM Savings
2. Fractionation Unit TA Scope Determination -
Concern was Historically Documented Caustic
Cracking
a) Detail Review of Operating Practice Historical and
Current (Including Changes)
b) Use of Fracture Mechanics to Identify Capability of NDE
Technology for Inspecting Known Problems – 14
Pressure Vessels, Light Hydrocarbons – Butane,
Isopropylene, Propane, etc
c) Recommended AE and/or Angle Beam to Detect
Cracking
d) Documented 10 – 20 M Savings for $83K Investment in
Analysis

30. EXPERIENCE WITH API 510
PARAGRAPH 6.5….
3. Evaluation of Corrosion Rate Documentation at
Plant that Had Historically done No or Very Few
Internal Inspections
a) Identified Major Concerns with Quality of Historical
Corrosion Execution and Documentation
b) No Calculations Done and if Done was Inconsistent
c) Reliability Engineer was Trying to Take Action Where
Required
4. Evaluation of Cracking Potential in Small SS
Tower
a) Owner User Contract MI of Equipment
b) Historical Inspections did not Cover all Potential
Damage Mechanisms
c) RBI Established Required Inspections and Evaluated
Consequences of Failure

31. Sometimes you have to
deliver an Unpopular
Answer
But it is All about
Making the Right
Decisions and Taking the
Right Action
OPERATIONS
SAFETY
INSPECTION
MAINTENANCE
SUPERVISOR
ENGINEERING
PLANT
MANAGER’S
OFFICE
ENGINEERING MANAGER’s – Daily
Challenges

32. 1. Clarifying the PSM exemption for atmospheric storage tanks;
2. Oil- and Gas-Well Drilling and Servicing;
3. Oil- and Gas-Production Facilities; way behind Implementing; don’t follow 510 & 570
4. Expanding PSM Coverage and Requirements for Reactivity Hazards;
5. Updating the List of Highly Hazardous Chemicals in Appendix A of the PSM Standard;
6. Revising the PSM Standard to Require Additional Management-System Elements;
7. Amending Paragraph (d) of the PSM Standard to Require Evaluation of Updates to
Applicable recognized and generally accepted good engineering practices (RAGAGEP);
whatever API or standards writing organizations put out
8. Clarifying the PSM Standard by Adding a Definition for RAGAGEP;
9. Expanding the Scope of Paragraph (j) of the PSM Standard to Cover the Mechanical
Integrity of Any Safety-Critical Equipment;
10. Clarifying Paragraph (l) of the PSM Standard with an Explicit Requirement that
Employers Manage Organizational Changes;
11. Revising Paragraph (n) of the PSM Standard to Require Coordination of Emergency
Planning with Local Emergency-Response Authorities;
12. Revising Paragraph (o) of the PSM Standard to Require Third-
Party Compliance Audits;
13. Expanding the Requirements of §1910.109 to Cover Dismantling and Disposal of
Explosives, Blasting Agents, and Pyrotechnics;
14. Updating §§1910.106 and 1910.107 Based on the Latest Applicable Consensus
Standards;
15. Updating the Regulations Addressing the Storage, Handling, and Management of
Ammonium Nitrate;
16. Changing Enforcement Policy of the PSM Exemption for Retail Facilities; and
17. Changing Enforcement Policy for Highly Hazardous Chemicals Listed in Appendix A of
the PSM Standard without Specific Concentrations.
OSHA PSM RFI signed in August 2013 – potential candidates for
rulemaking or enforcement policy changes – Still Under Review

33. RISK MANAGEMENT – Consider
Augustus’ MI Seminar March 17th & 18th