Introduction: The incidence of fires and explosions have led to severe damage in many industries, primarily in industries’ financial losses. This study was conducted to estimate losses due to fire and explosion and the impact of control measures on the number of losses applying Dow's Fire and Explosion Index. 

Methods: This is a case study conducted in one of the process units of an oil extraction factory. Dow's Fire and Explosion Index Hazard classification guide, 7th edition, issued by the American Institute of Chemical Engineers was applied. Data were obtained mainly through interviews and consultation with experts, as well as reported operating parameters and process documents.

Results: The Dow Index of the processing unit was estimated to be 243.68, and the most probable base damage was approximately $4.15 million in 2008. The actual damages were estimated to be $2,863,500, and the number of lost work days to be 64.56 days. The interruption losses were estimated to be $15,817,200 and the total losses to the system to be $18.67 million. These results demonstrated that losses resulting from production interruptions are greater than losses due to the destruction of equipment. A series of corrections was then proposed and risk analysis was performed again to examine the effects of reforms. The comparison shows that by applying reforms the FEI can change to 86.62 and the total loss can reduce to $9.03 million.

Conclusion: This study shows that Dow's Index is a systematic tool to examine the impact of control measures. It also enhances resource management considering an optimal insurance contract. Considering the priority of reducing damage factors, several correction actions were suggested, such as modifying the drainage system, installation of hexane detectors, an automatic sprinkler system, fire detectors on the cable tray, and finally, using the water spray washing on the tanks.


Keywords: Fire, Explosion, Cost, Losses, DOW Index
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