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The Major Hazard Installation (MHI) Regulations, promulgated under the Occupational Health and Safety (OHS) Act (Act No. 85 of 1993) aims to protect personnel and members of the public from the impacts of fires, explosions and dispersion of toxic vapours resulting from industrial accidents.

Under the regulations, all industrial facilities handling, storing, and processing hazardous materials such as liquefied petroleum gas, ammonia, carbon dioxide are required to quantitatively analyse and assess the risk associated with these installations.

Risk management MMRisk occupational health and safetyAnother major requirement for these MHI sites is the compilation of an Emergency Response Plan (ERP), which requires a preliminary risk assessment to identify potential risk scenarios.

“Our initial risk analysis process at MMRisk involves mathematical modelling to determine the types and sizes of fires and explosions that may result from accidental release, as well as statistical modelling to determine the likelihood of accidents occurring on these sites,” says Motlatsi Mabaso, director, MMRisk.

“From the mathematical modelling we determine the numerical magnitude or level of risk of each facility and make suggestions of risk prevention and mitigation measures in order to manage the risk and ensure it is reduced to broadly acceptable (BA) levels or levels that are as low as reasonably practicable (ALARP).”

Mabaso says, determining the hazards is inherent in the design of the process and MMRisk applies these steps to the oil and gas as well as the mining and metals industries.

“We work with companies to identify hazards in their designs and to suggest methods of managing those hazards and the associated risk. The most common method for this process is our offering of Hazard and Operability (HAZOP) studies. Our most popular service is Major Hazard Installation Risk Assessment, a service that is legally mandated in the OHS Act,” he says.

Mabaso notes the compilation of ERPs at MHI sites is now standardised through the publication of a South African National Standard, SANS 1514: Major Hazard Installation: Emergency Response Planning (2018). This standard was published in December 2018 and is considered industry best practice for emergency response.

“The purpose of the standard is to ensure adequate organisation and communication within the site and between the site and its neighbours to facilitate an effective response in case of emergencies,” says Mabaso. “SANS 1514 is expected to become a legal requirement once currently underway amendments to existing MHI Regulations are completed.”

Rational for revising existing MHI legislation

Mabaso explains that, as it stands, most stakeholders in the South African MHI industry – including the AIAs, owners and operators of MHI facilities and even the regulators – believe there is some difficulty in interpreting and applying the current MHI Regulations.

These include:

  • Confusion around the quantities and types of facilities that qualify for exemption.

  • The definition of ‘Impact on the Public’: Interpretation of the regulations by the various AIAs differ and the meaning of some of the somewhat vague phrases within the regulations is unclear. There is often a range of interpretations depending upon who is reviewing an MHI report, from an AIA, to the local authorities, and the national Department of Labour.

  • There is also the problem of standardisation of the MHIs – two AIAs can give MHI Reports that look completely different – which also has cost and quality implications for the client.

Mabaso believes with the changes in the regulations, certain topics will be resolved –MHIs will be standardised as well as pricing in the market, for example – so that clients know irrespective of who they employ to conduct their assessment, the quality will be guaranteed.

Implications of non-compliance

If companies do not undertake some of the studies, they won’t be able to determine the level of risk on the public and personnel and may find themselves non-compliant with Risk Legislation. Consequences can include, amongst others.

  • Injury and death to people on and offsite.

  • Negative media coverage.

  • Reputation and brand damage.

  • Production stoppages by the Department of Labour and others.

  • Insurer non-payment.

  • Litigation costs.

  • Compensation for injury and death.

Future projections for the company

MMRisk is currently the only 100% Black owned and, therefore, Level 1 BBBEE provider of Major Hazard Installation (MHI) Risk services, says Mabaso. The company is in a rapid growth phase and is growing its client base significantly every year. “The aim is to focus on a small number of niche services and to build our reputation as a thought-leader in the Process Safety and Risk Engineering space. We aim to steadily increase our market share year-on-year to become the biggest supplier of these services in the country,” he concludes.

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