A Business-Outcome Focussed, Risk-Based Approach to Management of Critical HSSE Aspects on Capital Projects
Authors: Green Elizabeth L , Wills David 
Published: March 2017

The majority of capital projects in the oil and gas industry in recent decades have experienced schedule delays and budget overruns, often as a result of sub-optimal management of health, safety, social and environmental (HSSE) issues. The Critical Aspect Management process described in this paper is a proven approach that identifies HSSE issues that pose a risk to the successful delivery of the project outcomes, integrates the HSSE approval and issue management pathway into the overall project development and decision making, and allows for efficient alignment of HSSE resources based on project risk.

Capital project alternative selection, facility siting, compliance permitting and management, and risk identification and management are all critical aspects that must be evaluated and addressed very early in the project lifecycle and actively managed throughout the lifecycle.

The Critical Aspect Management process begins by evaluating critical HSSE aspects, required for optimal execution of a capital project, with a clear focus on project outcomes as well as HSSE outcomes. The HSSE requirements and project risk are identified and evaluated early and at each stage gate in the capital project lifecycle.

Once identified, the aspects are prioritized based on predefined risk criteria which consider:Potential impact to the Net Present Value (NPV) of the project:Regulatory and social/risks within project alternatives/optionsPotential impacts on cost, schedule and regulatory/social factorsCompliance management and assurance requirements

HSSE aspects in capital projects drive hundreds of project decisions and requirements. If not evaluated and prioritized based on risk criteria, the project can fall victim to complex over management of non-critical issues. Only through risk prioritization and active, integrated management of these aspects can efficient and sustainable practices be imbedded throughout the capital project lifecycle to achieve optimal project outcomes.

The Critical Aspect Management process enables a project to focus its limited resources on the HSSE aspects that present the greatest risk to project success. This process also facilitates more efficient application of resources to lower priority HSSE aspects. When resources are effectively applied based on risk, the outcomes include:Improved project decision making including identification of project optimization opportunitiesBetter integration of HSSE critical inter-dependencies;Improved project schedule due to priority regulatory engagement.

Large capital projects generate hundreds of HSSE related aspects that must be managed over the multi-year lifecycle of a project. As resources within the industry continue to be reduced, it becomes more and more critical to ensure those resources are focused on the most critical aspects of a project. Failure to do so, can results in critical risk not being appropriately managed, while less critical aspects take up valuable resources. In addition, failure to prioritize risk can result in poorly integrated and overly complex risk management systems. The Critical Aspect Management process ensures effective and efficient management of high priority critical HSSE aspects.