Risk Management in Construction - Challenging and Emerging Issues (in Vietnam) Part 3

Analyze Risk Factors Affect on Vietnam Construction and Petro Projects

In the Risk Management in Construction FORUM, Mr. Pham Hong Linh and Dr. Trinh Thuy Anh made a presentation on Risk Factors Affecting Vietnam Construction and Petro Projects.

Mr. Pham Hong Linh who is now the General Director of OMMON Pipeline project 400 Km Length and a Vice President of PV Gas shared his years of experience in managing construction projects such as (i) Dung Quat Oil Refinery, (ii) Thi Vai LPG Terminal, (iii) Phu My - Thu Duc Gas Pipeline, (iv) Ca Mau Gas – Power - Fertilizer, and (iv) PVN Tower Building at Le Duan St, HCM. He explained the problems faced in the projects and the causes as follows:

• Dung Quat Oil Refinery - Delay Cost increase due to The Owner Change and Wrong in the estimation
• Thi Vai LPG Terminal - Delay, Crack Settlement due to wrong in design of foundation
• Phu My - Thu Duc Gas Pipeline - Delay due to Change F.S and Cost increase
• Ca Mau Gas – Power - Fertilizer - Delay and not yet operate due to Cost increase from half billion to 900 million.
• PVN Tower Building at Le Duan St, HCM - Delay due to policy change and Design & Build
  

In his conclusion, he gave his positive opinions regarding Risk Management for Vietnam Construction Projects as follows:

• Risk management should be considered as an important part of project management.
• Risks management need to be considered into related regulation. Construction Law or Government Decrees
• Especially focus on the initiation stage:Investment report, Feasibility Study, Project planning and Detail Design.
• The Government required playing an important role in study and providing risk management institution in Investment Projects.
• Proposes in specific institution for risk management in terms of time, cost, resource, regulation, guideline, process and content by the government. For example, the cost estimated for risk management could be considered as essential part among the total investment cost of the project.
• The Investors should pay appropriate attention to risk management along with project planning while those institution and policies do not approve.
• The appendix of the report suggests a risk management process to them.
  

During the Question and Answer session, participants asked following questions:

• When is the best time to conduct Risk Management?
• According to Mr. Linh, Risk Management must be carefully taken in each project phase. In each phase, different risks occur. For example, during the Feasibility Study, we should consider risks related with Land Acquisition. He explained that one of the project must pay a lot of compensation to the contractor because the owner cannot give the compensation to the people on time. Another example, for pipeline project, during the design stage the project may not identify any road construction and then at the construction stage, a new road construction was constructed. This means that additional costs to repair the road after the construction of pipe line occurs.

Posted by

Dr. BHW Hadikusumo
CEIM Coordinator
http://www.set.ait.ac.th/ceim/

" CEIM offers Master and Doctoral degrees in Construction Project Management and Infrastructure Management in Indonesia, Thailand and Vietnam "