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to a risk-based system into our procedures and policies in the 1990s. David Kroon (DK): Whether it's man- aging our personal health or external corro- sion on a pipeline, risk-based decision- making is something we have practiced over our entire careers. When I entered the industry in 1971, the Natural Gas Pipeline Safety Act of 1968 had just been amended to include requirements for corrosion pro- tection by coatings and cathodic protection (CP). Existing bare steel pipelines were to be evaluated and CP applied where there was a high risk of external corrosion. Mod- els were developed to calculate the proba- bility of encountering certain soil condi- tions that increased the risk of external corrosion. For pipelines and distribution systems, pipe segments or sections were risk-ranked to identify which should be addressed first and to develop a program to mitigate the risk by installing CP based upon corrosion priority. We later developed more sophisticated models to calculate the Mean Time to Corrosion Failure (MTCF) based upon field tests and laboratory tests on soil samples to measure corrosion activ- ity and compare the relative risk of failure due to external corrosion. NACE: What challenges are involved in implementing, managing, and monitoring these systems? TA: We see many companies develop- ing risk assessment tools without first hav- ing a clear picture of how these tools will support decision-making. A successful risk management system goes beyond assess- ment tools to create an integrated system that allows the company to effectively share and utilize risk information. Spending time up front defining some critical aspects, such as the objective of the system, how risks are to be identified and assessed, and how identified risks are evaluated and com- municated across the organization will go a long way in avoiding some of the common pitfalls associated with developing these systems. JD: Any system being incorporated into a prescriptive operating world involves a very intense management of change (MOC). Documenting what we are going to do and how we do it is critical to imple- menting a risk-based system (or any pro- gram) into a pipeline operator's policy and procedures and staying in compliance with local and national codes. Implementation takes the most time as it involves training and documentation and then managing the program, including data storage and analy- sis. Monitoring the actual data can be a challenge. Getting 100% acceptance of the program and the change by operating personnel is also a challenge. DK: The biggest challenge is collecting, storing, and accessing accurate data on the pipeline and the envi- ronmental conditions. Changing conditions is one challenge, but consistent collection of reliable data is of even greater concern. Often overlooked are the importance of test instrumentation, procedures, quality checks, and data reproducibility. How do we recognize poor-quality data? NACE: How are current and emerging U.S. pipeline regulations, such as from the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration (PHMSA), affecting your risk management practices? TA: PHMSA and the industry are mov- ing toward more quantitative and investi- gatory risk modeling. The domain knowl- edge required to develop, maintain, and interpret the results generated in these more complex assessments is not always available for all operators. Therefore, as we strive to continuously improve our risk models, we have also dedicated significant internal development efforts on data ana- lytics to ensure the outputs of the assessment are easily understood and usable to all stakeholders. JD: PHMSA regulations are getting more prescriptive, and incorporating risk- based systems into a prescriptive system is difficult but can be managed. Once you have incorporated the PHMSA policy into your policy and procedures and developed a plan on how to manage the regulation, it may be integrated into your risk-based sys- tem with proper planning and integration. The key is to get into your policy and proce- dure manuals and clearly document how you will be addressing the regulation (stay- ing in compliance) and address risk in your risk program. DK: The risk management practices of our clients are being driven to higher levels of sophistication by pipeline regulations. Qualitative techniques are being replaced by quantitative assessments. For our com- pany, these changes have created the need for developing quantitative risk assessment tools for external corrosion and alternating current interference. NACE: Can you provide one or more examples of how a risk-based system is being successfully used in your work— for example, increased pipeline integrity, safety, environmental protection, and cost savings? TA: Once implemented, a risk manage- ment system provides pipeline operators with critical information they can use to operate and maintain their pipeline sys- tems. For example, the output of a success- ful quantitative risk assessment should be able to tell you, at any location: 1) the sever- ity of each threat acting on the pipeline, 2) the contributing factors driving each threat, 3) the potential impact to people, places, and the environment due to a loss of containment, and 4) the corresponding aggregate risk level. This risk information, when used as part of a larger risk manage- ment program, can then be directly used to develop targeted response plans. These sys- tems provide a significant improvement in safety, reliability, and optimized spending beyond the ad-hoc decision-making of the past. JD: Managing your program using remote monitoring is a successful risk man- agement practice. You are able to gather the data from rectifiers and critical bonds on a 32 APRIL 2017 MATERIALS PERFORMANCE NACE INTERNATIONAL: VOL. 56, NO. 4 FEATURE ARTICLE