Risk Management Techniques

Question: Write on Risk management techniques.



Deepwater Horizon was one of the most devastating industrial disasters which were begun in the Gulf of Mexico on April 20, 2010. In the history of the petroleum industry, the deepwater horizon is the largest oil spill (Powers et al., 2017). In this oil spill total of 4.9 million barrels of oil discharged into the sea. 
Due to this incident, it was reported that there was extensive damage to the wildlife and marine habitats. Tourism, as well as fishing, was also affected greatly by the oil spill. It was also reported that the infant dolphin was dying at a rate of 6 times more than the normal rate (Powers et al., 2017). Heart-related diseases have been widespread in the marine life that exposed to the oil spill.
According to the government of the United States, the main cause of the oil spill was the defective cement on the wall (McGowan et al., 2017). Apart from the defective cement contractor Halliburton and the operator of rig Transocean were also responsible for the oil spill. 
BP is highly responsible for the same along with its partners. BP and its partners had adopted a cost-cutting approach to reducing the cost and also there was ineffective safety system. So, these are also the major reasons for the oil spill and extensive damage. Along with all these, ineffective government policies, as well as ineffective and unsystematic industry practices, were also responsible for the oil spill (McGowan et al., 2017). If the government had regulated the petroleum industry effectively, this incident would not have taken place.


Here we need to understand an important thing that such type of disasters should be prevented. If such type of disaster is occurring, there would be extensive damage, and we cannot mitigate the damage up to certain level. So, to deal with or prevent such disaster there should be effective government policies and industry practices. The governing body should monitor the industry on a regular basis (Etnoyer et al., 2016). Apart from this, the government should also direct the industry to ensure the safety. There should be standard safety measures in the petroleum industry to ensure the safety. 
The government should formulate strict policies to charge all the responsible persons for the disaster and damage. There should be capital punishment for the responsible parties. Apart from this, there should be an emergency management department to deal with such disaster immediately (Etnoyer et al., 2016). All the required material and equipment should always be available to deal with such disasters any time.
All the faulty and outdated machinery and equipment should be replaced with the updated and new machinery and equipment. All the drilling activities which are above the danger level should not be permitted by the governing body. 
The decision like cutting cost on the cost of safety should not be taken. It is not a feasible solution to reduce the cost because it ultimately increases the cost (Etnoyer et al., 2016). Along with all these, all the staffs and employees should be well trained and instructed to deal with the entire situation effectively to prevent such type of disasters. 


1, Deepwater: Report to the President, 2011. Princeton, 1999. Available at: https://www.gpo.gov/fdsys/pkg/GPO-OI  LCOMMISSION/pdf/GPO-OILCOMMISSION.pdf 2, Transocean (2010) Archive - Deepwater Horizon Spec. Available at: https://web.archive.org/web/201006191 21120/http://www.deepwater .com/fw/mai n/Deep water-Horizon-56  C17.html
3, Deepwater Horizon Study Group (2011) 'Final Report on the Investigation of the Macondo Well Blowout', pp. 1-124. Available at:
http://ccrm. berkeley.edu/pdfs   papers/bea   pdfs/dhsgfinal report-march201 1-tag.pdf 

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