1. Engineering Risk Assessments and Risk Communication Sarah Arulanandam, Hazard and Risk Group RWDI West Inc. DISCLOSURE OF MATERIAL ENVIRONMENTAL EXPOSURES: What should investors expect? January 20, 2005

2. Definitions of Risk  Risk = frequency x consequence  Frequency: accidental releases, upset conditions  Consequences: short-term, acute  Risk = exposure x effect  Exposure: low-level, continuous emissions  Effect: long-term chronic  Risk = frequency x consequence x outrage  Outrage: stakeholders, media, public, government  Risk = attractiveness of target x consequence  Attractiveness: likelihood of attack  Risk = ???

3. TECHNOLOGY SELECTION Design & Construction Standards Control Options Accident, Mitigation & Recovery Options RISK BASED DECISIONS RISK ASSESSMENT Public Involvement Guidelines & Standards Risk Utility Risk Acceptability Risk Communication RISK ANALYSIS Employee and Worker Safety Public Safety Environmental Financial HAZARD ANALYSIS Hazard Identification Source Term Modelling Dispersion Modelling & Forecasting Receptor Response Modelling FREQUENCY ANALYSIS Historical Accident Incident Data Predictive Failure Models Event Tree Analysis Fault Tree Analysis RISK MANAGEMENT

4. Steps Involved in Hazard and Risk Management  Identify the hazards  Define the system and characterize the source  Conduct dispersion modelling  Estimate the consequences  Compare hazard results to accepted public health and safety criteria  Review the options for managing the hazards  Examine failure frequencies and event probabilities  Estimate the risk  Compare risk results to accepted risk criteria  Review the options for managing and reducing the hazards and risks (i.e., alternate design and operating parameters, and accident control, reduction and mitigation strategies) Hazard Analysis Risk Analysis Risk Management Hazard Assessment Risk Assessment Hazard Management

5. Threat Spectrum (Courtesy of DND) Least Greatest Most Likely: High Yield Explosive (HYE) Most Likely: High Yield Explosive (HYE) Most Dangerous: Nuclear Weapons Most Dangerous: Nuclear Weapons ----------------------------------------- ----------------------------------------- Greatest Threat: Contagious Biological Pathogen Greatest Threat: Contagious Biological Pathogen HYE Biological Toxins Industrial Chemicals Biological Pathogens Radio- Isotopes Chemical Weapons Nuclear Weapons

6. Example: Hazard Identification Jet Fire: Exposure to flame Exposure to heat Exposure to products Flash Fire: Initial exposure (toxicity) Exposure to flame Exposure to heat Exposure to products Dispersing plume: Exposure (toxicity) Uncontrolled release Immediate ignition No immediate ignition Delayed ignition No ignition

7. Safety Design and Optimization  Compare alternative designs  Assess control systems and operational parameters  Compare risks to accepted standards Generate alternatives and implementation strategies

8. Emergency Planning  Recommendations for emergency planning zones and land-use  Understand the nature and extent of the hazard  Select the level of protection required  Define an emergency planning zone (EPZ) Communicate findings

9. Example: Health and Safety Planning Priorities Advance warning of an accident? Accident occurs Plume disperses Exposure to dispersing plume Area where acute effects may be experienced: Emergency Response Plan (responsibility of company) Selection of EPZ criteria Area where chronic effects may be experienced: Public health response area (shared responsibilities) Selection of health criteria Area where other impacts may be experienced Potential release source

10. Public Involvement and Communications  Present an understanding of the hazards and risks at public meetings  Preparation of materials for presentation to stakeholders  Regulatory applications and expert testimony  Corporate due-diligence and policy development

11. Forensic Incident Analysis  Accident investigation and reporting  Describe the system  Evaluate the meteorology during the event  Recreate the incident  What happened?  Who was affected?

12. Applications: Hazard and Risk Assessments  Safety design and optimization  Recommendations for emergency planning zones and land-use  Public involvement and communications  Regulatory applications and expert testimony  Corporate due-diligence policy  Accident investigation and reporting

13. Incidents Accidents The Heinrich Pyramid Unreported Occurrences