The UK Oil and Gas industry is a complex industry faced with several uncertainties which include Oil reserve, exploration, product price, supply and demand uncertainties. These uncertainties have led to implied risks which affect the various aspect of the industry such as construction, operation, maintenance and finance.
The industry has over the years been prone to various kinds of risks which have adversely affected productivity. The industry is characterized by making decisions which are uncertain and irreversible. (Xie, et al 2009)
Rapid change in technology and development has caused an increased demand for efficiency in the oil and gas industry.
Market forces, globalization and competition as explained by Cleland and Ireland (2007) have brought about a need for oil and gas companies to increase the quality and scope of their projects while at the same time reducing cost and time. This will cause an increase in risks and their likelihood. This explains the need for accurate assessment of risk as they evolve in the cause of administering projects
Get your grade
or your money back
using our Essay Writing Service!
Generally the life span of oil and gas projects span over decades and involves more risks than other projects. This research evaluates various risks in the UK oil and gas industry by examining the impact of risk assessment in oil and gas production and identifying the challenges being encountered.
The research streamlines its focus to the construction and maintenance aspect of oil and gas production. It Proffers suggested solutions by proposing an effective risk framework putting into consideration the identified challenges and issues faced in the industry
1.1 Project Rationale
1.11 Personal Rationale
Undertaking a research in this area of project management was motivated by the researcherâ€™s keen interest in risk management and its application in oil and gas industry. The UK oil and gas industry functions in a complex and changing business environment posed with new risks over time. This study will expand the researcherâ€™s knowledge and skills in understanding how to apply risk assessment effectively in the oil and gas industry.
1.1.2 Business Rationale
Risk assessment aids decision making process in risk management process. Management of risk brings about a change determines to a large extent the success of a project. The UK oil and Gas industry is one which has been posed constantly with new emergent risks due to changes in technology, climatic conditions and business environment. It experiences risks which are of enormous consequences if not dealt with adequately. The constant change and development it has undergone over the years has brought about a need for proper assessment of likely risks which this industry is liable to encounter. The result of this affects project success.
1.1.3 Academic Rationale
Risk assessment is a key aspect in Project risk management. Risk management decisions are made by organizations only after the identified risks have been properly assessed.
The four major deliverables include; identification, analysis, determining appropriate risk response strategy and Implementation of response option selected. This research deals with the impact of these deliverables in oil and gas production the UK. Carrying out a good risk assessment facilitates the project success; that is meeting time quality and scope.
1.2 Project definition
The project definition describes the fundamental features of the research project. It gives a clear understanding of the purpose and boundaries of the research project.
1.2.1 Aim and Objectives
The impact of risk assessment in Project Management, with a case study on oil and gas production in the UK oil and gas industry
To investigate the impact of risk assessment within UK oil and gas projects and determine its effect on project success: A focus on construction and maintenance aspect of oil and gas production.
To establish from current literature the relevance and importance of risk assessment in the oil and gas projects.
To analyse the challenges and influences of risk in construction and maintenance aspects of oil and gas projects.
To investigate the effect of risk assessment in the success of oil and gas projects.
To Assess the risk perception and safety culture in the oil and gas Production environment
Always on Time
Marked to Standard
To propose an effective framework for risk assessment adoptable by the UK oil and Gas industry
1.3 Project Scope
The project scope identifies the work content and outcomes. It explains and sets a boundary on what will be included and excluded from the project. This research has its scope inclusion and exclusion as described below.
1.3.1 Scope Inclusion
The study involves carrying out a secondary research on risk assessment within the United Kingdom oil and gas Industry. The focus will be on oil and gas production dealing with the construction and maintenance aspects within the industry.
This study will discuss some aspects of risk management as related to the oil and gas industry; it however will involve providing information which can be used in undertaking a primary research on it.
1.3.2 Scope Exclusion
This study will not discuss in-depth on the health and safety laws in the oil and gas industry. Also, there will be no primary research carried out on this study.
During the cause of carrying out this research, there will be various deliverables at different phases of the project as described in the schedule which include:
The Project research plan detailing the scope, aims and objectives, assumptions, considerations, schedule, and budget of the report
A literature review based on secondary research done in the research topic area.
Proposed plan for carrying out a primary research on the research topic
Conclusion and proposed recommendation based on the findings made in the research
Limited time and resources available for the compiling relevant information on the research area
Information source is based on secondary research.
There is the assumption that the Oil and gas companies in the UK carryout related activities and experience similar kinds of risks.
This research takes into consideration the difficulty in accessing the information and data directly from oil and gas companies and therefore develops a proposed plan that could be used in undertaking a primary research in the future.
1.7 Budget/resource requirement.
Project budget are the cornerstone of selecting, managing and completing a project. Also known as cost, it is one of the triple constraints used in tracking project success. (Tomczyk 2005) The resources for this research are categorized into human and material resources. Estimates have been assigned for each resource and the required budget for the execution of the project is detailed in the appendix
1.8 Research Project Schedule
Project schedule starts with the defining the project works at the appropriate level of decomposition. (Kendrick 2003, pp 77) The activities involved in the project are being broken down into smaller tasks based on the life cycle phases with dates assigned to them. The table 1 shows the tasks at the different phases of the research project and the Schedule denoted in the gantt chart representation in the appendix 1
1.9 Project Approach
The findings from this research will be developed from secondary data collected from secondary research. The source of information and data to be collated and analyzed include textbooks, Journals, articles, white papers and other academic resources related to the oil and gas industry.
1.10 Ethical Considerations
In carrying out this research a Research ethic questionnaire was filled. This was done to indicate and clarify any ethical issues to be taken into consideration during the research. The Questions answered included those concerning; research scope, confidentiality, sources of collecting data and possible data protection procedure followed ,effect on involved organisations consequence and effect of undertaking the research, required approval and the implication of the research project on the University. The appendix 3 shows the answered ethics questionnaire