Project Schedule Internal Risk Management in EPC Gas Pipeline Project: A Case Study

Oil and gas sector is considered as a backbone of any country’s economy. In Viet Nam, the promotion of gas industry development since the early 1990s has significantly contributed to the economic development of the country.
The demand of domestic gas consumption is being increased in a very short time. Therefore, Petro Vietnam has cooperated with national and international petroleum companies to speed up the plan of developing and building of the new gas fields in the southeast sea and southwest sea of Vietnam. As a result, lot of new pipelines will be installed to transport gas from field to shore of Vietnam, and this process involves many risks. Due to the unique characteristic of this project, the risk management during project execution became very important activity because the risks may have effect on cost, schedule and quality of the project. Risk management is a key to successful project implementation.

For most effective and efficient risk management, it is recommend to plan, analyze and manage risk in all phases of project life cycle specifically from design to construction phase.

Mr. Pham Binh Lam made a case study which objectives were to: (1) describe key activities in EPC gas pipeline project ; (2) identify risk factor in implement the EPC gas pipeline project which may affect the project schedule; and (3) propose risk solution that can be used to manage in the EPC gas pipeline project

Conclusion

Based on the data collected mainly from Bloc B&52-Omon gas pipeline project of Petro VietNam Gas Corporation, the author has clarified that EPC gas pipeline project contains high risk during project execution. The very important stages are from engineering stage to construction stage because these stages influence the quality of gas pipeline project. There are a lot of risk factor impacts on the project schedule in these periods such as experience, knowledge and skill of owner, contractor, subcontractors, design change, and environment impact. Pipeline construction in the offshore environment as well as onshore environment which across many rivers and canals are difficult and dangerous activity which lead to accidents and incidents frequencies happen especially if this project have a long distance from offshore to onshore pipeline route. It will not only cause project delays but also directly and indirectly cause very high project cost.
Major risk factors which may affect EPC gas pipeline project schedule has been identified by and facilitated during the brainstorming session of key experience stakeholders in this project such as top management, project manager, site manager, HSE manager, office personnel and the author.

The author has proposed appropriate strategies to reduce major risks schedule in EPC gas pipeline project by conducting a Framework on EPC Schedule Risk Management through a real gas pipline project case study -Block B – Omon gas pipeline project.The results are shown in the table below.


Recommendation

In order to obtain efficient schedule risk management in EPC gas pipeline project this study proposes a number of recommendations:
- Experience project management team should be appointed to the selection EPC contractor

- The EPC contractor has to contribute audit procedure for detailed designer to select qualified designer effectively. In addition, review and approval by Project Management team (PMT) of both selection of detailed designer and approval of designed document

- The EPC contractor and subcontractor should contribute an effective and efficient safety management system

- An effective communication and coordination system between lower stake holder (e.g. EPC contractor, subcontractor, vendor, etc) should be set up

- The owners should have high commitment of all people involved especially top management commitment in all stage of project and hand over authority to make decision.

- The Risk Management Plan should be reviewed during the EPC phase as specified in the Project Management Plan to ensure that appropriate actions have been taken and followed up. Reviews should also occur at the commencement of a new project phase or if there are significant changes to the project scope or operating environment.
His thesis abstract is copied and posted.

Abstract

In order to adapt the demand of domestic gas consumption is being increased in very short time PetroVietnam has cooperated together with national and international petroleum companies to speed up the plan of developing and building new gas fields in the southeast sea and southwest sea of Vietnam. Therefore a lot of new pipelines will be installed to transport gas from field to shore of Vietnam. In oil and gas project specify gas pipeline project contains high risk during project execution because of interacting activities of many event in condition of limited time, human resource and budget and the participation of many different parties in the project with the role, responsibilities as well as different objectives make the project more complex. Additional, only four gas pipelines project that built in Vietnam. Due to the unique characteristic of these project, the risk management during project execution is became very importance activity because the risks effect on cost, schedule and quality of the project. Risk management is a key to successful project implementation The author has identified mayor significant risks which impact project schedule and has proposed appropriate strategies to reduce major risks schedule in EPC gas pipeline project by conducting a Framework on EPC Schedule Risk Management through a real gas pipeline project case study -Block B – Omon gas pipeline project.