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TECHNOLOGICAL AND NATURAL RISKS
2 Jun, at IST: Risk Governance for South Atlantic
Disciplina: Riscos Naturais e Tecnológicos
Mestrado Integrado em Engenharia do Ambiente
Mestrado Bolonha em Engenharia e Gestão da Energia
Analisar riscos emergentes e sistémicos, de um modo que facilite a adopção de processos de mudança tecnológica, minimizando as consequência negativas de riscos que ameaçam indivíduos e sociedades. A análise concentra-se em riscos tecnológicos e naturais, analisados em conjunto com riscos sistémicos emergentes, incluindo o desemprego e riscos associados de desindustrialização. O objectivo é contribuir para que os estudantes aprendam a conceber e planear praticas de engenharia em contextos de crescente incerteza, incluindo o projeto de estratégias de industrialização que considerem oportunidades associadas á mitigação de riscos energéticos e ambientais. Inclui a discussão de processos de envolvimento de diferentes atores (i.e., “stakeholders”), em particular com base em formas de comunicação de riscos.
A disciplina tem por base a realização de um projeto, orientado pela análise de um problema específico, e inclui o desenvolvimento por grupos de alunos de casos de estudo envolvendo, sempre que necessário, trabalho de campo. Inclui a identificação e formulação de uma questão específica de governança de riscos sistémicos. O tratamento metodológico segue praticas internacionais relevantes, sobretudo as desenvolvidas no contexto da OCDE e do International Risk Governance Council, IRGC ( http://www.irgc.org/risk-governance/irgc-risk-governance-framework/).
Para 2014, a disciplina será orientada para o estudo de riscos sistémicos emergentes no Atlântico Sul, incluindo desafios tecnológicos, económicos e ambientais, associados á exploração de petróleo e gás natural. A análise deve contemplar oportunidades e desafios de desenvolvimento científico, tecnológico e industrial, assim como o desenvolvimento endógeno das regiões. O objectivo final é contribuir para o desenvolvimento efetivo de uma plataforma na internet para estimular a discussão pública sobre as oportunidades e desafios de desenvolvimento associado á exploração de recursos energéticos no Atlântico Sul (ver em www.oipg.org ).
2ªf, 9:30-11:30, Sala V1.26 (Pav Civil)
4ªf, 11:30-13:00, Sala V1.33 (Pav Civil)
Course – Technological and Natural Risks 2014
IST- 2013-14, 2nd semester: February - June 2014
Master in Environmental Engineering, MSc
Master in Engineering and Energy Management, MSc
Master in Mechanical Engineering, MSc
Monday, 9:30-11:30, Room V1.26 (Pav. Civil)
Wednesday, 11:30-13:00, Room V1.33 (Pav. Civil)
Manuel Heitor (MH), PCA, DEM (coordination); email@example.com
Center for Innovation, Technology and Policy Research, IN+, http://in3.dem.ist.utl.pt/
M. Fernanda N. N. Carvalho (MFC), PAX, DEQ; firstname.lastname@example.org
Centro de Quimica Estrutural, CQE, http://cqe.ist.utl.pt/
Invited speakers(to be confirmed):
António Costa e Silva, Partex Oil&gas
António Pascoal, ISR/IST
Franz Kaltner, Technip
Jose Roque, Galp Energia
Luis Guerreiro, Partex Oil&gas
Luis Sebastião, ISR/IST
Nuno Simões, UAVision
Ramiro Neves, Maretec/IST
Ruben Eiras, Galp Energia
Rui Baptista, Galp Energia
Description and General Goals
Analysis of emerging and systemic risks, facilitating societies to benefit from technical change, while minimising the negative consequences of associated risks. The focus is on technological and natural risks, as analysed together with major societal risks, including unemployment and related deindustrialization risks. The ultimate goal is to help design engineering practices to deal with uncertainty, including industrialization strategies that consider major opportunities associated with the need to mitigate energy and environment related risks. This includes the discussion of stakeholder engagement processes to help communicate emerging risks and to foster their mitigation.
The course will be project-based and problem-oriented, including the analysis of specific cases and fieldwork by groups of students. It involves the identification and formulation of a specific issue in risk governance, to be followed by research work by group of students. A comprehensive framework for risk analysis and governance will be used following best international practices, as by the OECD and the International Risk Governance Council, IRGC ( http://www.irgc.org/risk-governance/irgc-risk-governance-framework/ ).
For 2014, the course will be oriented towards the analysis of emerging systemic risks in South Atlantic, in association with technological, economic and environmental challenges of the exploration of oil and gas. Each group of students will identify and analyse a specific issue in energy security, risk governance and/or socioeconomic resilience across the Atlantic. The projects must consider a risk communication strategy.
The ultimate goal is that all projects contribute for the development of a web-based Observatory for risk governance in South Atlantic, stimulating a process of public participation in the discussion of emerging opportunities and challenges in South Atlantic (see at www.oipg.org ).
Proposed Orientation: 2014 Project based learning with relevance for the analysis of emerging systemic risks in South Atlantic, in association with technological, economic and environmental challenges of the exploration of oil and gas.
Emphasis is on new opportunities for industrialization that consider medium and long terms, giving a special attention to the need to consider increasing uncertainties to mitigate energy and environment related risks, together with secure operation of off-shore and industrial platforms, as well as port sites.
Students will work in groups addressing a specific project, considering a specific problem and taking into account opportunities associated with new technological developments and the need to mitigate energy and environment related risks. Student teams should contact different stakeholders, including industrial partners, field practitioners, and experts in relevant fields. Emphasis is on the creative design of engineering practices to deal with uncertainty based on the application of scientific knowledge and the need for social and economic relevance and applicability. It relies on active learning via a major project involving industry-based processes.
Brief Problem definition
The identification of vast hydrocarbons resources in the Brazilian pre-salt and, eventually, in the African pre-salt, as well as the technological innovations that led to the rapid increase of unconventional hydrocarbons resources in the USA both are reshaping the energy geopolitics. The recent gas discoveries in Mozambique sustain this process.
The increase supply of hydrocarbons in the North Atlantic (USA, Canada and potentially Mexico) and in the South Atlantic (Brazil, West Africa and potentially Venezuela) diminishes the economic risks of the disruptions in the Middle East oil supply for the Atlantic nations. In addition, the expansion of the Panama Canal (as expected in 2015) in times of increased uncertainty in the energy markets and potential production of unconventional gas worldwide, may foster new systemic risks to emerge in the Atlantic, particularly in the South Atlantic. This will probably occur together with traffic and major commercial sea routes, which will be significantly enhanced with the emergence of new industries in several parts of the Atlantic coast, including East and West Africa and Northern Brazil.
These changes may impact the overall scenarios for energy security at a global level, which require to be addressed and discussed in detail. In addition, many port zones in Latin America (e.g., Rio de Janeiro and Santos in Southeastern Brazil; Suape, Bahia and Pecém in Northeastern Brazil) and Southern and Atlantic Europe (including Sines, Lisbon and Leixões in Portugal, Valencia in Southeastern Spain, Las Palmas in Canarias, Algeciras), as well as in northern Europe (e.g., Rotterdam, in the Netherlands), will compete for promoting entry/exit gates of merchandise, thus leaden to opportunities to develop, and adding new risks to those regions. This initiative should focus on those changes in terms of technological and systemic risks.
The effects of this new context are not fully understood and, certainly, poorly measured as yet. Recent data suggests that a process of reindustrialization is emerging in North America and that the industrialization process in the South Atlantic is gaining momentum. If so happens, trade among Atlantic nations is likely to take off with obvious impact on trade between Pacific and Atlantic nations.
In any circumstance, the hydrocarbons resources of the Portuguese speaking countries (in particular, (Brazil, Mozambique and Angola) will play a significant role in the reshaping of the geopolitics of energy. This initiative intends to explore this role and to help deepening our understanding of emerging risks and opportunities. It aims to identify the current perception of academics, regulators, government officials and oil operators of Angola, Brazil, Portugal and Mozambique on this issue and to set a new research agenda.
The overall issue was discussed in a workshop organized in Porto, Portugal, by the time of the XV Conference on Latin Ibero-American Management of Technology - ALTEC 2013, http://www.altec2013.org/. It brought together different experts and stakeholders to discuss emerging challenges and opportunities for South Atlantic.
Specific Goals: Student Learning Outcomes
To develop students' competence and self-confidence as engineers able to deal with uncertainty and address complex issues associated with emerging and systemic risks. Emphasis is on the analysis of emerging systemic risks in South Atlantic, in association with technological, economic and environmental challenges of the exploration of oil and gas and related industrialization processes. The ultimate goal is to understand the need to mitigate energy and environment related risks and the secure operation of off-shore and industrial and/or port sites in the South Atlantic.
Phase 1 - Observe and identify an emerging issue in South Atlantic, by interviewing and speaking with experts and stakeholders. Alternative options and suggestions by students are accepted if considering other relevant issues.
Phase 2 - Analyse emerging and systemic risks, in a way to facilitate processes of technical change while minimising the negative consequences of associated risks. Use comprehensive frameworks for risk analysis and governance (International Risk Governance Council, http://www.irgc.org/risk-governance/irgc-risk-governance-framework/).
Phase 3 - Imagine, conceive and design engineering practices to deal with uncertainty, including industrialization strategies that consider major opportunities associated with the need to mitigate energy and environment related risks. Take into consideration major societal needs related with the need to foster job creation.
Phase 4 - Discuss and improve draft solutions, by discussing them with experts and stakeholders.
Phase 5 - Propose solutions (technology-based), identifying their weak and strong characteristics, challenges and opportunities. Specify technical innovations and potential limitations, including the use of scientific and technological knowledge to facilitate the implementation of the proposed solutions. If adequate, plan a business venturefor the proposed solution(s), discussing markets, their potential segmentation and dimensions, as well as identifying the necessary financial incentives to make it happen.
Phase 6 - Design a risk communication strategy, making use of diversified means and tools and using adequate languages for each of them:
The student teams will be able to retain the rights to any inventions they develop in this course. If a team should decide to pursue a patent, they may do this on their own. Alternatively (and this is strongly recommended for potentially sponsored projects), the team can “disclose” their invention to IST, following current rules.
Methods of analysis: risk assessment and governance
Student evaluation will be continuous throughout the course, with emphasis on the quality of the work performed by each group and the relative level of dedication of each student, within the various groups. Each group should submit three distinct elements by the end of the course, which are expected to contribute for the development of a web-based Observatory for risk governance in South Atlantic, stimulating a process of public participation in the discussion of emerging opportunities and challenges in South Atlantic (see at www.oipg.org ):
Main dates: four student presentations, followed by final presentation
FINAL WORKSHOP, with final student presentations: date to be confirmed.
1: Risk Governance for oil&gas exploration in the South Atlantic
2: Deindustrialization as a risk
Background Note – 1: Risk Governance for oil&gas exploration in the South Atlantic
The identification of vast hydrocarbons resources in the Brazilian pre-salt formation and the technological innovations that led to the rapid increase of shale hydrocarbons resources in the USA are both reshaping energy geopolitics . The increase supply of hydrocarbons in the North Atlantic (USA, Canada and potentially Mexico) and in the South Atlantic (Brazil), West Africa (Angola), East Africa (natural gas in Mozambique) and Caribbean’s (potentially Venezuela) diminishes the economic risks of the disruptions in the Middle East oil supply for Europe and the Atlantic nations . Once appropriate infrastructure is in place, they also hold the potential to diminish the risks to Europe arising from dependence on Russian gas .
The effects of this new context are not fully understood and as yet, certainly, poorly measured. Among other issues, the emergence of the area of “digital oil fields” is attracting and increasing attention worldwide in academia and business , with particular relevance to open new frontiers of knowledge for the application of ICT based services and solutions .
In addition, recent data suggest that a process of reindustrialization is emerging in North America and that the industrialization process in the South Atlantic is gaining momentum . If this happens, Latin America, Africa and Europe will need to foster a proactive industrial innovation strategy and better use its historical ties to the south Atlantic and the south Indian Ocean. This is because trade among Atlantic nations is likely to take off with obvious impact on Europe, as well as on trade between Pacific and Atlantic nations .
In any circumstance, the hydrocarbons resources of the Portuguese speaking countries will play a significant and growing role in reshaping the geopolitics of energy, with profound implications for Latin America, Europe and Africa . There is a need for technologies and policies to govern the new offshore Oil&Gas fields in such a way as to promote the clean safe and cost effective development of these resources while simultaneously promoting social and economic development across the region. An additional challenge is to help preparing Atlantic nations for the expansion of the Panama Canal (completion expected in 2015) as a result of which sea traffic and major commercial sea routes will be significantly enhanced .
These changes may impact many port zones and technology parks in Latin America (e.g., Rio de Janeiro and Santos in South-eastern Brazil; Suape, Bahia and Pecém in North-eastern Brazil), in Angola and in Mozambique, as well as in Southern Europe (including Sines and Leixões in Portugal, Valencia in South-eastern Spain, Las Palmas in Canarias, Algeciras).
There will also be impacts on ports in northern Europe (e.g., Rotterdam, in the Netherlands), promoting entry/exit gates of merchandise, thus leading to develop existing and adding new markets and opportunities for trade, as well as new risks to those regions. It will be essential to develop policies that build on these changes for the creation of new jobs and technology-related industries, as well as the need to tackle technological and systemic risks . These include maritime related risks in association with the expected increasing traffic in South Atlantic and the opening of the Panama Canal. But the enormous opportunities for naval and offshore related industries in the coming decades also require attention .
New industrialization strategies around the South Atlantic and Sub-Saharan Africa is of significant interest to Latin America, Africa, as well as to Southern European and Mediterranean countries, including Portugal, Spain, Algeria, Tunisia and Morocco . Literature suggests that the process by which countries or regions can develop and foster their industrial structure in a sustainable and responsible way, is to either explore different combinations of the capabilities they already possess, or accumulate new capabilities . Although exogenous shocks may create opportunities to explore different activities , endogenous growth is a complex and time consuming process, very much dependent on the structure and level of infrastructures, incentives and institutions, which are particularly affected by existing regulatory frameworks.
Potential issues for analysis
1 – Comparative Assessment of Oil&Gas sectors and realted risks in the North Sea, South Atlantic and Sub-Saharan Africa
A characterization of the dynamics of offshore related industries in the last 40 years should be carried out for major EU zones, with emphasis on the North Sea and related industrial development of Norway. The goal is to derive lessons learned to guide prospective studies oriented towards a potential new centrality for the south Atlantic. The work to be carried out should also consider the current situation regarding main infrastructures in South Atlantic and East Africa regions such as major ports and technology/business parks. These are characterized by a few large industrial plants and infrastructures, most of them not contributing for endogenous growth of those regions and, in many cases, having major impact on carbon emissions, as well as on environmental preservation. However, they are still potential sources of short term economic development and thus a trade-off between these two factors is expected.
Using life-cycle assessment and possibly a general equilibrium model, assessments should be conducted to describe both direct and indirect impacts associated with the development of oil and gas in the proposed regions. Indirect environmental impacts would be high compared to the direct: for example, if shipping is increased, there will be an increase in emissions associated increased traffic in north south shipping lanes. These shipping lanes can be identified now in heat maps of methane emissions.
Natural gas and oil developments in the regions will be heavily impacted by other world energy developments and trends, materials costs, and costs of competing energy sources and technologies, and thus cannot be considered in isolation.
Characterisation of macro-level geographies
a characterisation should be carried out of the macro-level geographies to review the historical evolution of the Oil and Gas industry, science and technology capacity, knowledge base, employment, supply chain, qualifications and skills, economic performance, trade flows and social well-being. The analysis should encompass:
Based on the results obtained, the analysis should continue to understand the current supply chains, their competitive profile and evolution, and their impact on the socioeconomic framework, globally and locally. This methodology require to go beyond the existing approach for analysis that is currently based in codes of economic activities, such as the NACE codes (similar to Portuguese CAE). It should consider the available macro and micro data on industrial sectors and firms regarding technology and knowledge bases, outputs and markets, trade flows and employment. The final output of this work should include a better understanding of the evolution of the Oil and Gas sectors in major regional blocks through the characterisation of the dynamic system industry-region-knowledge-people.
Important factors to foster local sustainable and endogenous growth through manufacturing industries include access to low-cost and/or high-skill labour, proximity to demand, efficient transportation and logistics infrastructure, availability of inputs such as natural resources or energy and proximity to centres of science and education.
The main ports and other related facilities such as industrial parks and research centres should be listed, characterised and compared in order to identify main infrastructure barriers and accelerators to the development of the Oil&Gas sector in the Atlantic. Examples of such facilities shall include the South European ports infrastructures in Sines, Portugal, Valencia, Algeciras and Las Palmas in Canarias, Spain, as well as the ports in Rio de Janeiro and Santos in South-eastern Brazil, Suape, Bahia and Pecém in North-eastern Brazil. Since labour skills are paramount to ensure the sustainable endogenous growth of the regions considered, this factor will also be included in the analysis. The characterisation of the industrial evolution in major port zones, as induced by a potential new centrality for the south Atlantic and South Indian Ocean, should be carried out considering the expected trade-offs, to forecast the overall sector development.
A complementary goal is to develop refined data products (e.g. geo-referenced maps and spatial analysis of data sets) to facilitate the interpretation of the analysis mentioned above and to share it with a wider audience. Such products may feed the development of a web-based visualisation tool.
Characterisation of regional geographies
This work should focus on comparative analyses of selected regions with comparable sizes, namely regions that host around 10 to 15 million inhabitants. The initial part of the regional analysis should replicate the one performed on macro-regions to assess derogations from the average that can provide additional insights on the weight of different variables and location-related issues. The comparative study of industrial evolution and accumulation of scientific and technological skills in selected regions should include:
Characterisation of industrial geographies
In parallel to the regional characterisation of industrialisation processes and the impacts of local policies in fostering them, it is necessary to look at the same problem from the perspective of industries and firms in the Oil&Gas sector that, on the one hand, are not bounded to a certain region but have their performance strongly dependent on the regions where they are located. Oil&Gas sectors should be targeted in terms of the following characteristics:
2 – Analysis of the risk governance along the Oil&Gas value chains
Complex sectors of activity, such as the energy or gas, have very complex supply and value chains, with very specific hierarchies. The globalisation of trade and supply chains led to the emergence of increasingly competitive global markets and to facilitated access to new suppliers, independently of their geographic location. Such globalisation involves systemic risks, dependent on global trends and evolution, major global events, variables that shape the geographies of the industry and innovation and socio-economic impacts. The work should include the analysis of vulnerability to hazards of natural, technological, human and other origins, as well as opportunities related with the adequate prevention of such hazards.
Results of the work to be carried out should help delineating a participatory risk governance platform to promote public and key stakeholders’ discussion on the general and specific risks for the sector, as well as to improve public awareness about the sector development, technology and progress.
South Atlantic and Sub-Saharan Africa value chain characterisation
The Oil&Gas value chain of South Atlantic and East Africa should be characterised through the identification of the main companies which are supplying the plants located in related port zones. This assessment will also include what are being supplied locally and what competences are being planned.
Identification of deficits on the potential risk governance
Potential risk governance deficits should be discussed, including insufficient awareness to new threats, unequal organizational capacity, and the difficulty of dealing with dispersed responsibilities among stakeholders with diverging interests.
Background Note - 2: Deindustrialization as a risk
There is a rising - and justified - concern that deindustrialization is hampering growth and undermining the competitiveness of developed economies leading to loss of jobs.
Industrialization has been the main driver behind rapid productivity growth achievement and social well-being improvements in different countries in the last 200 years . Since the first globalization in the end of the 19th century, the industrial landscape has been continuously evolving, showing a clear shift towards emerging Asian and Latin American economies in the last decades. The Asian shift is not something new, since in 1750 more than 50% of the world’s industrial trade was produced in China and India.
In many developed regions recent deindustrialization trends resulted from the emergence of new and fast-expanding markets; the surge of new pools of cost-efficient workforces, as well as emerging countries’ aggressive development policies. In the last 20 years policies have been favouring the development of knowledge intensive services oriented towards short-term growth and the financial markets . Parallel to this process of “technoglobalism”, post-industrialism advocates have promoted in the last decades services as a new panacea for rapid economic growth in developed - and developing - countries, overtaking the role of manufacturing industries as drivers of growth , ; .
This has resulted in “policy shifts” from manufacturing industries to knowledge-intensive services in developed regions worldwide , , including the US but with the notable exception of countries like Germany. Illustrating this trend is the decline in the number of U.S. manufacturing jobs from nearly 20 million in 1979 to about 12 million 30 years later , .
In fact evidence shows that an over-reliance on services, without an adequate balance with industrial activity, damages export performance, reduces labour productivities and favours inequality .
This is an issue for developed and industrialized countries, including the US that is losing ground to other economies or European peripheral countries increasingly focused in services; but also for developing countries such as Brazil where there are few world-class industrial “islands” disconnected from the rest of the country.
At the end of deindustrialization usually is social turmoil , triggering other systemic risks related to Social Unrest . These two risks have a reciprocal causal relation between them since deindustrialization leads to social unrest and the latter leads to deindustrialization as social instability hinders attracting and retaining industrial activities.
It is in this framework that several research centres and universities around the World are analysing this issue, perhaps the most notable one being the “Production in the Innovation Economy” project at the MIT . Other work includes a significant body of research in Brazil on industrialization, namely through regulation and local content policies
Fostering industrialization strategies
In addition to the presence of strong industrial bases, most of the well performing economies share other common features. One is diversification of activities, meaning that the economic output and that of industrial manufacturing in particular is distributed across a broad set of activities, which allows for mitigating risks but also for enhancing the capacity of the innovation system and the growth potential of the economy as a whole. This diversity can be found in countries like Korea or Taiwan , .
Other common feature is supply chain and knowledge networks’ complexity, related to the interactions between people and organizations measured in terms of the activities and job positions needed to produce a certain good within an economy. Complexity has also been shown to be a predictor of economic development and prosperity .
Endogenous growth theories treat R&D investment and education as endogenous variables in the long run of economic expansion, placing strong emphasis on the role played by knowledge creation and commercialization in promoting economic growth , .
However, making economies more diverse and specialized is extremely difficult and requires persistent learning processes and embedding skills and technology into people and organizations as the competitiveness of industries resides increasingly in the capacity to access and use knowledge and technologies in distributed knowledge bases, spread through a wide network of institutions .
Employment and its skills are therefore paramount to ensure the sustainable development of industries and the socioeconomic impact of industrialization25 and this is also true at firm-level, as shown by the analysis of the relationship between the production activity and the knowledge boundaries of a company - in other words, between supply chains and knowledge networks - that are specific to each industry. Innovation and ultimately competitiveness require knowledge boundaries to be much wider than the production ones , exploring historical perceptions of the utility of scientific knowledge, labour division and the shape and emergence of contemporary institutions of knowledge and innovation, as well as depicting and characterizing the tensions between knowledge and power .
Results also show that local access to knowledge and human capital significantly influence entry of knowledge-based firms into regions, confirming the need to look at (de)industrialization processes with a regional focus, without losing sight of the context and taking into account knowledge and innovation capabilities of countries and regions, thus calling the need for a new conceptual framework to address industrialization processes to be developed in the context of this project.
Another important part of the process of developing new capacities in support of industrialization are international partnerships focusing science, technology and innovation that have proven to work as a catalyser by promoting the exposure to other communities of experts and heterogeneous environments .
FINAL LIST OF PROJECTS