Basic Principles of Risk Assessment

Basic Principles of Risk Assessment

07 Nov 2023

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This informal CPD article ‘Basic Principles of Risk Assessment’, was provided by Synergen Oil and Gas UK, an independent engineering consultancy specialising in Process Safety, Technical Risk Management and Operational Safety services.

Risk assessment is a crucial component of ensuring safety and mitigating hazards in the oil and gas industry, where high-risk activities are commonplace. To effectively manage these risks, the industry follows some fundamental principles of risk assessment, which we will explore here in detail.

1. Risk Identification

Risk identification is the initial step in the risk assessment process. In the oil and gas industry, a variety of methods and tools are employed to identify risks systematically.

Below are a few commonly used risk identification techniques.

  • Hazard Identification Studies (HAZID)
  • Process Hazard Analysis
  • Failure Mode and Effects Analysis (FMEA)
  • Job Safety Analysis (JSA)
  • Incident Investigations

2. Risk Analysis

Once risks are identified, the next step is to analyze and assess them. This involves evaluating the likelihood and potential impact of these risks to prioritize mitigation efforts.

Qualitative Risk Analysis: This approach relies on expert judgment and subjective assessment to rank risks based on severity, likelihood, and urgency, providing a quick assessment of risk importance.

Quantitative Risk Analysis: This technique employs numerical analysis and modelling, using data-driven calculations to determine risk probabilities and impacts. It enables more accurate decision-making.

Several tools are used for risk analysis in the oil and gas industry. Some of them are,

  • Bowtie Analysis: Visualizes the relationship between potential hazards, their causes, and consequences, aiding in the identification of control gaps.
  • Fault Tree Analysis (FTA): Analyzes possible failure events and their causes, helping prioritize risk mitigation efforts.
  • Event Tree Analysis (ETA): Models potential consequences resulting from risk events, aiding in the development of prevention and response strategies.

This principle focuses on determining which risks require immediate attention and resources for effective risk mitigation. Key steps include risk scoring and setting risk acceptability criteria.

Risk Scoring and Ranking: Risks are assigned scores based on their likelihood and impact, allowing for the ranking of risks by importance.

Risk Acceptability Criteria: These criteria establish thresholds for acceptable risks based on regulations, industry standards, organizational objectives, and stakeholder expectations.

Risk Assessment Matrix: A visual tool that combines likelihood and impact scores to assess overall risk levels. It helps prioritize risks based on their combined scores.

4. Risk Control and Mitigation

Risk control and mitigation strategies are crucial for preventing accidents, protecting personnel, and ensuring operational continuity in the oil and gas industry. Key strategies include hierarchies of control measures and modelling risk control scenarios.

Hierarchies of Control Measures: This structured approach includes measures like elimination, substitution, engineering controls, administrative controls, and personal protective equipment (PPE).

Modelling and Simulating Risk Control Scenarios: Computer-based simulations evaluate the effectiveness of control measures before implementation, enhancing decision-making.

5. Risk Monitoring and Review

Continuous risk monitoring and review are essential to ensure risks are promptly addressed and effectively managed. Establishing a robust risk management system, using leading and lagging indicators, and conducting regular reviews are key aspects.

Setting up a Risk Management System: A system with clear roles, standardized processes, and appropriate tools is essential for effective monitoring and review.

Leading and Lagging Indicators: Monitoring involves both leading indicators for proactive risk assessment and lagging indicators to track historical performance.

Regular Review and Updates to Risk Assessments: Regularly revisiting identified risks and updating assessments based on changes in the operating environment or regulations helps identify emerging risks and enhance control strategies.


The oil and gas industry faces inherent risks that can have significant consequences. By adhering to these five principles of risk assessment, companies in the industry can proactively manage risks, improve safety, and protect assets and personnel.

We hope this article was helpful. For more information from Synergen Oil and Gas UK, please visit their CPD Member Directory page. Alternatively, you can go to CPD Industry Hubs for more articles, courses and events relevant to your Continuing Professional Development requirements.

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Synergen Oil and Gas UK

Synergen Oil and Gas UK

For more information from Synergen Oil and Gas UK, please visit their CPD Member Directory page. Alternatively please visit the CPD Industry Hubs for more CPD articles, courses and events relevant to your Continuing Professional Development requirements.

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