This paper is a retrospective analysis of the risk management and risk governance process of liquefied natural gas (LNG) development in Gladstone, Australia. In order to undertake this retrospective analysis, the risk governance framework developed by the International Risk Governance Council (IRGC) is used as a heuristic because it includes and goes beyond the ISO 31000:2009 risk approach that was used in practice. The IRGC framework consists of four different phases reflecting the risk handling chain: pre-assessment, risk appraisal, risk characterisation and evaluation, and risk management. Based on an analysis of the first three phases it was reported that the approach used by the LNG proponents in Gladstone followed relatively robust principles and guidelines despite containing a number of deficiencies. However, during the simultaneous construction of the three LNG facilities a number of environmental, social, and economic impacts and concerns emerged. Therefore, the overall aim of this paper is to explore what can be learned from this type of post-evaluation and to assess the implementation of risk management. The results identify a variety of aspects that have influenced the workability of the risk governance process and point to areas capable of improving similar problems for resource projects in the future.

Introduction

This paper is a retrospective analysis of the risk management and risk governance process of the development of three recently completed liquefied natural gas (LNG) facilities in Gladstone, Australia: Queensland Curtis LNG, Gladstone LNG, and Australia Pacific LNG. The construction company Bechtel was the primary builder for all three of these LNG facilities. This was the case because the technology that was chosen by each of the three proponents was the ConocoPhillips Optimized Cascading Technology and Bechtel has a relationship with ConocoPhillips and is the primary builder when that technology is used. The focus of the analysis is on the risk management and risk governance process of these LNG developments in order to assess its implementation and to explore what can be learned from post-evaluation. The findings provide insight into risk governance and stakeholder involvement for LNG projects which is important for researchers and decisionmakers seeking to increase their understanding and/or improve the effectiveness of the governance of extractive industries. In this context, risk governance refers to a body of scholarly ideas that points at complex multi-actor networks and processes dealing with collective decision-making on challenging public risks (IRGC, 2005; Van Asselt and Renn, 2011; van der Vegt, 2017). On a normative level risk governance is also understood as a set of principles that can inform how collective decision-making in the context of risk can be done responsibly (IRGC, 2005; Van Asselt and Renn, 2011). In this paper the risk governance framework developed by the International Risk Governance Council (IRGC) will be used as a heuristic to analyse the risk management and risk governance process of LNG development in Gladstone. The word heuristic is used to refer to an ‘investigative’ approach looking back at what has happened and seeking improvements on the basis of empirical evidence. It does not mean that the IRGC risk governance framework is seen as an ideal or all-comprehensive model that should be adhered to. Rather, the framework is used as a tool to systematically assess the implementation of risk management during LNG development in Gladstone, by collecting the views of those that were closest to the enactment of that specific governance application – and identify areas that deviated from expectations for specific categories of respondents, and gaps between intentions and outcomes that were considered significant for many.