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A decision framework for risk management, with application to the offshore oil and gas industry

Author

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  • Aven, T.
  • Vinnem, J.E.
  • Wiencke, H.S.

Abstract

In this paper we present and discuss a decision framework for risk management. The framework comprises the basic elements: problem definition (challenges, goals and alternatives), stakeholders, concerns that affect the consequence analyses and the value judgments related to these consequences and analyses (frame conditions and constraints), identification of which consequence analyses to execute and the execution of these, managerial review and judgement, and the decision. The framework has novel aspects on the way of classifying the decision situations and characterising risks. The classification is based on the two dimensions, expected consequences, and uncertainties. Our starting point is the offshore oil and gas industry, but our framework and discussion is to a large extent general and could also be applied in other areas. An example is outlined to illustrate the use of the framework.

Suggested Citation

  • Aven, T. & Vinnem, J.E. & Wiencke, H.S., 2007. "A decision framework for risk management, with application to the offshore oil and gas industry," Reliability Engineering and System Safety, Elsevier, vol. 92(4), pages 433-448.
    • Handle: RePEc:eee:reensy:v:92:y:2007:i:4:p:433-448
    DOI: 10.1016/j.ress.2005.12.009
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    Citations

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    Cited by:

    1. Rao Rao & Xingping Zhang & Zhiping Shi & Kaiyan Luo & Zhongfu Tan & Yifan Feng, 2014. "A Systematical Framework of Schedule Risk Management for Power Grid Engineering Projects’ Sustainable Development," Sustainability, MDPI, vol. 6(10), pages 1-30, October.
    2. Aven, Terje, 2011. "Selective critique of risk assessments with recommendations for improving methodology and practise," Reliability Engineering and System Safety, Elsevier, vol. 96(5), pages 509-514.
    3. Alsulieman, Abdullah & Ge, Xihe & Zeng, Zhiguo & Butenko, Sergiy & Khan, Faisal & El-Halwagi, Mahmoud, 2024. "Dynamic risk analysis of evolving scenarios in oil and gas separator," Reliability Engineering and System Safety, Elsevier, vol. 243(C).
    4. Langdalen, Henrik & Abrahamsen, Eirik Bjorheim & Selvik, Jon Tømmerås, 2020. "On the importance of systems thinking when using the ALARP principle for risk management," Reliability Engineering and System Safety, Elsevier, vol. 204(C).
    5. Hardaker, J. Brian & Fleming, Euan M. & Lien, Gudbrand D., 2008. "Risk in Public Policy Making: A Neglected Issue in Australia," 2008 Conference (52nd), February 5-8, 2008, Canberra, Australia 5997, Australian Agricultural and Resource Economics Society.
    6. Flage, R. & Aven, T., 2015. "Emerging risk – Conceptual definition and a relation to black swan type of events," Reliability Engineering and System Safety, Elsevier, vol. 144(C), pages 61-67.
    7. Sørskår, Leif Inge K. & Selvik, Jon T. & Abrahamsen, Eirik B., 2019. "On the use of the vision zero principle and the ALARP principle for production loss in the oil and gas industry," Reliability Engineering and System Safety, Elsevier, vol. 191(C).
    8. Terje Aven, 2014. "The substitution principle in chemical regulation: a constructive critique, by Ragnar Löfstedt," Journal of Risk Research, Taylor & Francis Journals, vol. 17(5), pages 569-571, May.
    9. Aven, Terje & Castro, I.T., 2008. "A minimal repair replacement model with two types of failure and a safety constraint," European Journal of Operational Research, Elsevier, vol. 188(2), pages 506-515, July.
    10. Aven, Terje & Castro, I.T., 2009. "A delay-time model with safety constraint," Reliability Engineering and System Safety, Elsevier, vol. 94(2), pages 261-267.
    11. Gholamreza Dehdasht & Rosli Mohamad Zin & M. Salim Ferwati & Mu’azu Mohammed Abdullahi & Ali Keyvanfar & Ronald McCaffer, 2017. "DEMATEL-ANP Risk Assessment in Oil and Gas Construction Projects," Sustainability, MDPI, vol. 9(8), pages 1-24, August.
    12. Aven, Terje, 2014. "On the meaning of the special-cause variation concept used in the quality discourse – And its link to unforeseen and surprising events in risk management," Reliability Engineering and System Safety, Elsevier, vol. 126(C), pages 81-86.
    13. Wajiha Ansari & Muhammad Asim & Salman Manzoor, 2020. "A systematic frame work of schedule risk management for power grid engineering projects,sustainable development," Technium Social Sciences Journal, Technium Science, vol. 5(1), pages 185-216, March.
    14. Aven, Terje, 2008. "A semi-quantitative approach to risk analysis, as an alternative to QRAs," Reliability Engineering and System Safety, Elsevier, vol. 93(6), pages 790-797.
    15. Yuan Yang, 2019. "Reforming Health, Safety, and Environmental Regulation for Offshore Operations in China: Risk and Resilience Approaches?," Sustainability, MDPI, vol. 11(9), pages 1-13, May.
    16. Fjæran Nygaard, L. & Aven, T., 2010. "On the link between risk perspectives and risk regulation—A comparison between two cases concerning base stations and wireless networks," Reliability Engineering and System Safety, Elsevier, vol. 95(6), pages 689-697.

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