Risk of future Exxon Valdez declines 92% since risk assessment, safety measures, says O.R. study

The danger of a future Exxon Valdez disaster in Alaska’s Prince William Sound has declined substantially since the State of Alaska, environmentalists, oil companies, and the fishing industry brought together a risk management team, according to a study in a journal of the Institute for Operations Research and the Management Sciences (INFORMS®).

Measures taken before the formation of the risk management team had brought down the risk by 75%. Actions taken based on the late 1990’s risk assessment report reduced the risk by an additional 68%, with a 51% reduction in the expected oil outflow. Cumulatively, the risk is down 92%. Hopefully the benefit, say the authors of the $2 million study, is the prevention of another environmental disaster like the 1989 Exxon Valdez oil spill, whose bill was a $2.2 billion cleanup and environmental ruin.

The paper entitled “The Prince William Sound Risk Assessment” is by Jason R.W. Merrick, Virginia Commonwealth University; J. René van Dorp, Thomas Mazzuchi, John R. Harrald, John E. Spahn, The George Washington University; and Martha Grabowski, Rensselaer Polytechnic Institute. It appears in the current issue of the journal Interfaces: An International Journal of the Institute for Operations Research and the Management Sciences. A summary of the study can be found online http://www.informs.org/Press/ExxonValdezabstract.pdf.

Generating Trust Between Oil Companies and Environmentalists

The team’s task was not only making a reliable assessment of something that may never happen again – a future Alaskan oil spill – but also fostering cooperation among distrustful participants, including environmentalists, the fishing industry, and oil companies.

“While the stakeholders in [Prince William Sound] all recognized the need for a rational method to evaluate the merits of risk-intervention measures, to improve the allocation of resources, and to avoid implementing measures that would adversely affect system risk,” write the authors, “they did not trust each other at the beginning of the project.”

The PWS risk assessment fostered a cooperative risk-management atmosphere. The authors write, “All stakeholders finished the project convinced that they had reduced risk of further multibillion dollar accidents and, with the cooperation fostered by the collaborative analysis process, the stage has been set for further improvements in managing risk.”

Constructing an Accident Probability Model

The Prince William Sound team estimated the probability of future accidents involving oil tankers, including collisions, drift groundings, powered groundings, foundering, fire, explosion, and structural failure.

The authors constructed an accident probability model that accounted for the relationships between vessels’ operating environment, triggering incidents, and accidents.

They used operational data such as vessel type and movement data from the US Coast Guard, tanker arrival and departure information from the Ship Escort/Response Vessel System (SERVS), and meteorological data from the National Oceanographic and Atmospheric Administration.

They also conducted surveys to obtain data about open fishing times, locations, and duration. They estimated the probability of mechanical failures using proprietary failure data supplied by local shipping companies. Because large databases of local accident and human error data did not exist, they used expert judgement to estimate the probabilities of such events. All these information sources were combined into a simulation of the Prince William Sound oil transportation system capable of evaluating the risk of oil spills.

Some of the results of the risk assessment proved surprising. Before the operations research study, for example, people believed that the area at greatest risk was the Valdez Narrows or Hinchinbrook Entrance of the Sound. The authors showed greater risk in other parts of the Sound.

And they found that the primary risk was not another future Exxon Valdez-style grounding but tanker collisions with fishing vessels that operate in large numbers during fishing seasons.

They also identified a risk of collisions between tugboats that escort tankers into harbor and tankers leaving the port. And they showed that some proposals actually worsened the risk of collision. One of these was additional weather-based closure restrictions that in fact increased traffic congestion.

In its recommendation, the team developed rules to reduce the number of potential collisions involving tankers, fishing boats, and tugs. They showed the value of improving human and organization performance through the International Safety Management program.

Key Benefits

To date the various organizations comprising the risk-management teams have taken the following actions based on the results:

• Oil companies introduced enhanced capability tug service to escort oil-laden tankers through Prince William Sound’s Hinchinbrook Entrance.
• The team completed a further project to find an improved escort scheme, which was adopted, minimizing interactions between oil tankers and escort tugs, while maintaining the ability to save disabled tankers.
• The Coast Guard Vessel Traffic Service now manages interactions between fishing vessels and tankers.
• SERVS has increased the minimum required bridge crew on board escort tugs to add additional error-capture capability.
• The International Maritime Organization has approved a change to the tanker route through central PWS, reducing the number of course changes required.
• The shipping companies have made long-term plans for quality-assurance and safety-management programs.

The Institute for Operations Research and the Management Sciences (INFORMS®) is an international scientific society with 10,000 members, including Nobel Prize laureates, dedicated to applying scientific methods to help improve decision-making, management, and operations. Members of INFORMS work in business, government, and academia. They are represented in fields as diverse as airlines, health care, law enforcement, the military, the stock market, and telecommunications. The INFORMS website is at http://www.informs.org.