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Article
Publication date: 14 March 2022

Atul Rawat, Sumeet Gupta and T. Joji Rao

This study aims to focus on identifying the business risks that cause a delay in the oil and gas projects and suggest the way forward toward the better development of the…

Abstract

Purpose

This study aims to focus on identifying the business risks that cause a delay in the oil and gas projects and suggest the way forward toward the better development of the city gas distribution (CGD) sector in India by suggesting the appropriate mitigation strategies.

Design/methodology/approach

The study is a systematic review of literature on risks causing a delay in oil and gas projects. Comprehensive literature was carried out following a seven-step model to develop an exhaustive list of risk classifications and factors, risk identification methods and strategies to mitigate the risks. Weighted average ranking method is used to identify the top ten risks affecting oil and gas projects.

Findings

This research identifies the top ten risks frequently impacting the oil and gas projects, which are project cost, improper project management, change in economic parameters, currency exchange rate, government regulations and laws, contractor and subcontractors issues, lack of skilled labor, delay in approvals, health and safety issues and force majeure. These risks are primarily responsible for cost overrun and project delay. Additionally, this study recommends the implementation of joint risk management to avoid CGD project delay.

Originality/value

The CGD industry is in the growing stage with many projects under construction. However, there is a lack of research to manage risks in the CGD project. This study contributes to the limited literature available on risk management in oil and gas projects. Additionally, it highlights the need for further research to explore the different risks factors affecting the CGD business and its operations and subsequently develop appropriate mitigation strategies.

Details

International Journal of Energy Sector Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1750-6220

Keywords

Article
Publication date: 3 April 2017

Abdulsalam Mas’ud, Nor Aziah Abd Manaf and Natrah Saad

The investment climate is one of the key factors considered by foreign investors while deciding their investment destination. This paper aims to attempt at validating the…

Abstract

Purpose

The investment climate is one of the key factors considered by foreign investors while deciding their investment destination. This paper aims to attempt at validating the second-order model of oil and gas projects’ investment climate. Examination of the relationship between the dimensions of oil and gas projects’ investment climate; strategy, participants/operating environment and risk/return; and the overall latent construct was conducted. The study also evaluates the goodness of fit of the second-order model using relevant fit indices.

Design/methodology/approach

Oil and gas experts in Malaysian marginal oil fields subsector were deployed, through whom responses were collected that formed the data set used in the analysis. Then, the data were used for confirmatory factor analysis, evaluation of the second-order model through path analysis and for model fit evaluation.

Findings

The finding revealed that the second-order model of oil and gas projects’ investment climate is valid and reliable. It also revealed that all the three dimensions, strategy, participants/operating environment and risk/return, have significant effects on the formation of the oil and gas projects’ investment climate. Finally, the goodness of fit of the second-order model satisfied the relevant fit indices.

Research limitations/implications

The findings present valuable insights to policymakers on the extent of the influence each of the dimensions has on the overall latent construct. The validity and reliability analysis suggests the measurements of the second-order model of oil and gas projects’ investment climate construct, and its dimensions are valid, reliable and fit for future empirical research. Thus, it calls for replication in other oil and gas settings.

Originality/value

The findings from the results of this study are pioneering. Extant literature falls short in attempting the validation of the second-order oil and gas projects’ investment climate scale, as well as relating each of the dimensions with the overall latent construct.

Details

International Journal of Energy Sector Management, vol. 11 no. 1
Type: Research Article
ISSN: 1750-6220

Keywords

Article
Publication date: 3 April 2018

Edward Godfrey Ochieng, Oghenemarho Omaruaye Ovbagbedia, Tarila Zuofa, Raymond Abdulai, Wilfred Matipa, Ximing Ruan and Akunna Oledinma

The purpose of this paper is to examine the efficacy of knowledge management (KM) based systems and best practices that could be used to address operational issues in the…

1814

Abstract

Purpose

The purpose of this paper is to examine the efficacy of knowledge management (KM) based systems and best practices that could be used to address operational issues in the oil and gas sector.

Design/methodology/approach

Given little was known empirically about the strategies and practices which contribute to improved performance, innovation and continuous improvement in the oil and gas sector qualitative method was used. Semi-structured interviews were used to derive senior managers’ constructs of project delivery efficiency and KM based systems. The interviews were analysed through the use of a qualitative analysis software package NUDIST NVivoTM. Participants were selected using purposive sampling. Validity and reliability were achieved by first assessing the plausibility in terms of already existing knowledge on some of the operational issues raised by participants.

Findings

These were synthesised into a framework capturing seven well-defined stages. All these steps emerged as being related; they are comprised of independent variables. These steps were found to comprise of knowledge management technology approaches, knowledge management people approaches, KM strategies and value enhancing practices.

Research limitations/implications

Although the findings are pertinent to oil and gas organisations, it will be important to conduct follow-up research validating the potential for using the results of this study to establish frameworks for knowledge and information management in different organisations and contexts. This will provide not only data about the validity of the framework in generic terms but will also generate additional data on the application of KM strategy.

Practical implications

As shown in this study, successful KM based systems requires the aligning of business strategy, technology for KM, project management operations with an enterprise knowledge-sharing culture. Such sharing requires managing the behaviour of project personnel such that knowledge transfer becomes part of the organisation’s norm.

Social implications

The implementation of KM based systems requires deliberate planning and action to create the conditions for success and put in place the strategy, leadership, goals, process, skills, systems, issue resolution, and structure to direct and exploit the dynamic nature of project work. The strategies proposed in this research cannot be expected to resolve all KM issues in the oil and gas sector. However, their use defines an approach that is superior to the traditional approaches typically adopted and consequently merits far wider application.

Originality/value

The proposed framework presents a better way of optimising the performance of project-based operations thus enabling oil and gas organisations to reform their poor performance on projects and empower them to better manage emerging cultural challenges in their future projects. Reflecting on their experiences, the participants confirmed that the proposed KM framework and its seven well-defined stages were central to the effectiveness of KM in oil and gas operations. Although the scope of this research was restricted to projects in Nigeria and the UK, the geographical focus of this research does not invalidate these results with respect to other countries. The fact is that the oil and gas sector globally shares some common fundamental characteristics.

Article
Publication date: 7 November 2019

Sani Damamisau Mohammed

Carbon emissions from gas flaring in the Nigerian oil and gas industry are both a national and international problem. Nigerian government policies to eliminate the problem…

Abstract

Purpose

Carbon emissions from gas flaring in the Nigerian oil and gas industry are both a national and international problem. Nigerian government policies to eliminate the problem 1960-2016 yielded little or no results. The Kyoto Protocol (KP) provides Clean Development Mechanism (CDM) as an international market-based mechanism to reducing global carbon emissions. Therefore, the purpose of this paper is to analytically highlight the potentials of CDM in eliminating carbon emissions in the Nigerian oil and gas industry.

Design/methodology/approach

This paper reviewed the historical background of Kyoto protocol, Nigerian Government policies to eliminating gas flaring in its oil and gas industry 1960-2016 and CDM projects in the industry. The effectiveness of the policies and CDM projects towards ending this problem were descriptively analysed.

Findings

Government policies towards eliminating gas flaring with its attendant carbon emissions appeared not to be yielding the desired results. However, projects registered under CDM in the industry looks effective in ending the problem.

Research limitations/implications

Therefore, the success recorded by CDM projects has the policy implication of encouraging Nigeria to engage on establishing more CDM projects that ostensibly proved effective in reducing CO2 emissions through gas flaring reductions in its oil and gas industry. Apparent effectiveness of studied CDM should provide a way forward for the country in eliminating gas flaring in its oil and gas industry which is also a global menace. Nigeria could achieve this by providing all needed facilitation to realising more CDM investments.

Practical implications

CDM as a policy has proved effective in eliminating gas flaring in the Nigerian oil and gas industry. The government should adopt this international policy to achieve more gas flaring reductions.

Social implications

Social problems of respiratory diseases, water pollution and food shortage among others due to gas flaring are persisting in oil and gas producing areas as government policies failed to end the problem. CDM projects in the industry have proved effective in eliminating the problem, thus improving the social welfare of the people and ensuring sustainable development.

Originality/value

The paper analysed the effectiveness of Nigerian Government policies and an international market-based mechanism towards ending gas flaring in its oil and gas industry.

Details

Sustainability Accounting, Management and Policy Journal, vol. 11 no. 3
Type: Research Article
ISSN: 2040-8021

Keywords

Article
Publication date: 30 July 2020

Mukhtar A Kassem, Muhamad Azry Khoiry and Noraini Hamzah

The oil and gas construction projects are affected negatively by the drop in oil price in recent years. Thus, most engineering, procurement and construction (EPC…

Abstract

Purpose

The oil and gas construction projects are affected negatively by the drop in oil price in recent years. Thus, most engineering, procurement and construction (EPC) companies are opting to optimize the project mainly to mitigate the source of risks in construction to achieve the project expectation. Risk factors cause a threat to the project objectives regarding time, cost and quality. It is additionally a vital component in deviating from the client's expectation of productivity, safety and standards. This research aims to investigate the causes of risk in the oil and gas construction projects in Yemen.

Design/methodology/approach

A comprehensive literature review from various sources including books, conference proceedings, the Internet project management journals and oil and gas industry journals was conducted to achieve the objectives of this study. This initial work was predicated strictly on a literature review and the judgments of experts to develop the risk factor framework for the oil and gas construction projects in Yemen.

Findings

The authors found a few studies related to risk factors in oil and gas construction projects and shared a similar view about general construction projects. However, only a fraction of the factors accepted have included the variances of other studies on a regional basis or specific countries, such as the Yemen situation, due to the differences between the general construction industry and oil and gas industry. Moreover, the factors of these attributes were still accepted due to their applicability to the oil and gas industry, and no significant variances existed between countries. Research has indicated that 51 critical factors cause risks in the oil and gas construction projects in Yemen. Such risk factors can be divided into two major groups: (1) internal risk factors, including seven critical sources of risks, namely client, contractor, consultant, feasibility study and design, tendering and contract, resources and material supply and project management; and (2) external risk factors, including six sources of critical risk factors, namely national economic, political risk, local people, environment and safety, security risk and force-majeure-related risk factors. A risk factor framework was developed to identify the critical risk factors in the oil and gas construction projects in Yemen.

Research limitations/implications

This research was limited to the oil and gas construction projects.

Practical implications

Practically, this study highlights the risk factors that cause a negative effect on the success of oil and gas construction projects in Yemen. The identification of these factors is the first step in the risk management process to develop strategic responses for risks and enhance the chances of project success.

Social implications

The identification of risks factors that cause the failure of construction projects helps develop response strategies for these risks, thereby increasing the chances of project success reflected in the oil and gas sector, which is a main tributary of the national economy in developing countries.

Originality/value

This research is the pioneer for future investigations into this vital economic sector. Given the lack of resources and studies in the field of construction projects for the Yemeni oil and gas sector, the Yemeni government, oil companies and researchers in this field are expected to benefit from the results of this study. The critical risk factors specific to the oil and gas construction projects in Yemen should be further investigated with focus only on Yemen and its oil and gas industry players.

Details

Engineering, Construction and Architectural Management, vol. 28 no. 4
Type: Research Article
ISSN: 0969-9988

Keywords

Article
Publication date: 2 November 2015

Hassan Fazliani and Chotchai Charoenngam

The purpose of this paper was to investigate the factors affecting the claim negotiations in Iranian oil and gas construction projects. The findings of this paper give…

Abstract

Purpose

The purpose of this paper was to investigate the factors affecting the claim negotiations in Iranian oil and gas construction projects. The findings of this paper give better understanding of claim negotiations in Iranian oil and gas projects.

Design/methodology/approach

The research methodology for this study involved the use of Delphi technique, conducted with non-Iranian stakeholders being involved in Iranian oil and gas construction projects more than five years and determined the major factors, affecting claims negotiations. Subsequently, factors’ weightings were derived using analytic hierarchy process (AHP).

Findings

In total, 13 affecting factors identified in three categories of: external, cultural and personal behavioral. Finally, the weights of factors were identified.

Research limitations/implications

This research was conducted in the context of Iranian oil and gas projects. This industry has high standards and its employees are well chosen and have frequent in job training. All these affect the organization, working and people’s culture and behavior compared to other sectors of construction business. Therefore, the results of this research are specific to the oil and gas industry.

Practical implications

The findings of this paper can be considered as a practical guide for dealing with Iranian counterparts during claims negotiations to ensure amicable settlement. Also, it is useful for Iranian stakeholders to have better understanding of concerns of non-Iranian stakeholders.

Originality/value

The paper is the original work of the authors, and to the best of the authors’ knowledge, this paper has for the first time introduced the factors affecting claims negotiations. The findings of this paper provide useful insight into effective claims negotiations of Iranian oil and gas projects.

Details

International Journal of Energy Sector Management, vol. 9 no. 4
Type: Research Article
ISSN: 1750-6220

Keywords

Article
Publication date: 14 August 2019

Mukhtar A. Kassem, Muhamad Azry Khoiry and Noraini Hamzah

This study aims to identify and assess the significant risks in Yemen oil and gas construction projects based on their risk rating (impact and probability) by using…

Abstract

Purpose

This study aims to identify and assess the significant risks in Yemen oil and gas construction projects based on their risk rating (impact and probability) by using probability–impact matrix (PIM).

Design/methodology/approach

In total, 51 risk factors that might affect construction projects in the oil and gas sector are defined through a detailed literature review and expert judgment. The risk factors were tabulated in a questionnaire form, which was sent to a total of 400 participants asking their contribution in identifying the risk matrix for the risk factors in terms of impact and probability of occurrence during the project life cycle. Five zones were used in the matrix according to the degree of risk factor’s severity on the success of the project. These zones are light green, dark green, yellow, light red and dark red.

Findings

The PIM analysis for risk factors found that five factors are located in the dark red zone, as top risks factors have a very high impact and very high probability of occurring; 40 factors are located in the light red zone; six factors are located in the yellow zone; and no factors are located in the green zone (light and dark), which is considered an indication of the importance of risk factors under study and their impact on the success of construction projects in the oil and gas sector. Moreover, the factors under feasibility study and design and resources and material; are the most categories effect on project success.

Research limitations/implications

The research was limited to the oil and gas construction projects in Yemen.

Practical implications

Practically, this study highlights the top risk factors in oil and gas construction projects, which might cause an adverse effect on project success in Yemen. Classification and ranking of these factors by using the risk matrix provide the basis for risk response planning to enhance the chances of project success.

Originality/value

This paper identifies the matrix for risk factors affecting the success of construction projects in the oil and gas industry in Yemen. There is a significant contribution expected from this research, especially for companies operating in the oil and gas sector and other organizations that plan to invest in this field, in addition to expected benefits for the Yemeni Government and researchers because of lack of research in this area.

Details

International Journal of Energy Sector Management, vol. 14 no. 3
Type: Research Article
ISSN: 1750-6220

Keywords

Article
Publication date: 2 May 2020

Mukhtar A Kassem, Muhamad Azry Khoiry and Noraini Hamzah

Construction projects in the oil and gas sector are greatly affected by external risk factors, especially those related to the economy, politics, security and stability…

Abstract

Purpose

Construction projects in the oil and gas sector are greatly affected by external risk factors, especially those related to the economy, politics, security and stability factors. Hence, this research aimed to investigate the fundamental relationship between the external risk factors and their effects on the construction project success using Structural Equation Modeling method and PLS-SEM approach.

Design/methodology/approach

Data collected through a structured survey distributed to projects teams in the oil and gas sectors in Yemeni companies involved in mega construction projects. A hierarchical model for assessing causative external risk factors and their effects on project success was developed and analyzed using Smart PLS 3 software of SEM.

Findings

The findings showed that economic, political, force majeure and security-related risk factors had a strong effect on project success. Besides, the Coefficient of Determination (R-squared value) equals 0.743, represented the proportion of variation in the dependent variable(s), which can be explained by one or more predictor variable. Moreover, the predictive relevance value Q2 is 0.375 above zero, which indicates that the conceptual model can predict the endogenous latent constructs. The calculated Goodness of Fit (GoF) Index of the model was 0.699, which shows that the developed model had substantial explanatory power to represent the relationship between the cause of external risk factors to and the effect on construction project success.

Research limitations/implications

This research was limited to the oil and gas construction projects in Yemen as case study.

Practical implications

Practically, this study highlights the external risk factors that cause a negative effect on the success of oil and gas construction projects in Yemen. The research model of these factors is the first step in the risk management process to develop strategic responses for risks and explain the relationship between cause and effect on project success.

Social implications

The model of external risks factors that cause the failure of construction projects helps develop response strategies for these risks, thereby increasing the chances of project success reflected in the oil and gas sector, which is a main tributary of the national economy in developing countries.

Originality/value

There is a need to improve the planning of economic and security performance as well as to mitigate political risk factors effects on project success and other risk factors discussed in this study, which effect on construction project success according to their priorities.

Details

Engineering, Construction and Architectural Management, vol. 27 no. 9
Type: Research Article
ISSN: 0969-9988

Keywords

Article
Publication date: 16 July 2020

Hani Arbabi, Mohammad-Javad Salehi-Taleshi and Kian Ghods

Knowledge management (KM) is regarded as an essential factor in project-based organizations (PBOs), leading to organizational learning across projects. Over recent years…

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Abstract

Purpose

Knowledge management (KM) is regarded as an essential factor in project-based organizations (PBOs), leading to organizational learning across projects. Over recent years, most PBOs have inserted project management offices (PMOs) into their hierarchical charts to manage their projects much more coherently. These offices can correspondingly provide KM facilities in PBOs. Thus, this study aimed to analyze the relationship between PMO functions and KM infrastructure, as KM enablers in organizations, in Iranian oil and gas upstream PBOs.

Design/methodology/approach

A two-phase quantitative survey strategy was exercised in this research. The first phase was to investigate the relationship between PMOs and KM infrastructure and to prioritize PMO functions and KM infrastructure based on their existing implementation/establishment status in Iranian oil and gas upstream PBOs. The research participants, identified through the website of the National Iran Oil Company (NIOC), were comprised of 46 oil and gas upstream PBOs which applied for exploration and production (E&P) certificate in Iran in 2016 and 2017. Accordingly, a total number of 46 questionnaires were submitted to the aforementioned companies with a return rate of 41 cases. The second phase was fulfilled questioning 19 Iranian oil and gas industry experts to determine the one-to-one effect of PMO functions on KM infrastructure and to verify the first-phase results.

Findings

The results indicated a strong relationship between PMO functions and KM infrastructure. This relationship was significant with regard to “practice management” and “technical support”, having the most considerable connections with KM infrastructure. According to the first-phase results, the main functions of PMOs in Iranian oil and gas industry were “practice management” and “technical support”. Considering KM infrastructure, “structure” showed the lowest mean value while “culture”, “human resources” and “processes and procedures” obtained the highest scores. The results also demonstrated that PMO functions could lead to more improvements in “processes and procedures”, as a sub-component of KM infrastructure, compared with other sub-components. Furthermore, the oil and gas industry experts believed that “organizational culture” in KM could be shaped by most of PMO functions.

Originality/value

This study fulfilled the need for exploring the relationship between PMO functions and KM since academic literature lacked a thorough investigation, to the best of authors' knowledge, pertaining to the effects of PMO functions on KM development in oil and gas PBOs.

Details

Engineering, Construction and Architectural Management, vol. 27 no. 10
Type: Research Article
ISSN: 0969-9988

Keywords

Article
Publication date: 30 October 2018

Rateb Sweis, Alireza Moarefi, Mahmood Hosseini Amiri, Soad Moarefi and Rawan Saleh

The international energy agency states that the world’s primary energy needs are expected to grow to 55 per cent until 2030. Therefore, oil and gas industry as the main…

Abstract

Purpose

The international energy agency states that the world’s primary energy needs are expected to grow to 55 per cent until 2030. Therefore, oil and gas industry as the main energy source will be more crucial where building or advancing new capacities is required. Because the reports highlight the delay as a recurring problem, thereby, more in-depth investigation to find out the main contributing causes is needed.

Design/methodology/approach

Root cause analysis (RCA) was applied to identify, rank, analysis and categorize the main sources of this problem.

Findings

Based on RCA procedure; Pareto analysis showed that 84.7 per cent of the delay is because: the radar chart indicated no difference in perception of the participants regarding the importance of the root causes, correlation analysis suggested strong relationship among the participants and the cause-and-effect diagram emphasized more on operational, human and equipment categories, which in total account for 51.86 per cent of the delay.

Originality/value

The risk planners of large-scale projects can consider these root causes as the main items to analysis, monitor and control, as they are vitally important for project success.

Details

International Journal of Energy Sector Management, vol. 13 no. 3
Type: Research Article
ISSN: 1750-6220

Keywords

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