Project Management in the Oil and Gas Industry

Title:-
Statement of Requirements (SOR) Preparation
What
The SOR is a formal document. It can vary from being a one-page 
document (minor projects) to a sizeable document incorporating 
the “basis of design,” i.e., plant, pipe sizes, pressures, etc.
Why
The SOR is intended to document, in a clear and unambiguous 
manner, the key engineering inputs and the major engineering 
requirements and management tasks that have to be completed 
in order to meet a particular business objective, this objective 
being clearly defined at the beginning of the SOR. The completed 
SOR is intended to identify the factors that the business sponsor-
ing the project considers important to the ultimate success of 
the project, as well as being a high level specification of project 
deliverables.
How
Create a formal document, depending on the project needs.
When
Within the project framework, the SOR will form is an integral part 
of the select stage DSP and it is required for the chosen option at 
the end of Selection. The project should not continue into Define 
until the SOR has been approved.
Who
In practice, the SOR is usually prepared by the project personnel 
who liaise closely with the business unit personnel (SPA). It is 
important that the BU formally approves the SOR as it is effec-
tively a contract between the BU and the project team defining 
high-level deliverables and expectations. Similarly, because of 
the significance, a change management procedure should be 
established that will ensure all the changes receive the necessary 
approval.
This document also contains the technical information available from 
the owner, such as the location of the land and its coordinates system and 
its specifications. Noting that, this document will be a part of the contract 
document between the owner and the engineering firm, noting that the 
engineering firm will provide the cost time and resources (CTR) sheets 
based on this document.
In the case of projects such as gas, an LNG gas liquefaction project 
determines the amount of gas, type, and specifications which are needed 
to process and transfer with the clarification of temperature, pressure, and 
all other technical data for the final product to be shipped or transported 
outside. This is one of the most important data to be mentioned in the 
document, as it identifies the project lifetime.
Specifications required by the owner in the project should be defined 
clearly and precisely in this document.

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14 
Project Management in the Oil and Gas Industry
It should be noted that we must hold many of the regular meetings 
between the owner, technical team, and the consulting engineering respon-
sible for the preparation of initial studies. Through that, the SOR may be 
amended several times and each time the document must contain the date 
and revision number to contain all of the requirements of civil, architec-
tural, electrical, mechanical, and others found in the project.
We may recall here that in quality assurance we must be sure that the 
final document resides with all the parties and that everyone is working 
through this document. This must be done to determine the number of 
meetings and the exact schedule of meetings needed to reach the target 
required.
The SOR document is not only required for the new project, but it is also 
needed in the case of modification to the buildings or in the plant. In the 
case of small buildings, the owner should define the required number of 
apartments, floors, and stories or any other requirements the owner feels 
are a benefit to his target.
Upon receipt of the engineering office, the SOR document is to respond 
to the owner document with another document that is called the basis of 
design (BOD). Through the document, the engineering firm will clarify 
the code and engineering specifications, which will operate in the design 
as well as the calculation methods, theory, and computer software that will 
be used.
This document may state the required number of copies of the drawings 
that will be sent to the owner and the sizes of those drawings.
In addition, the engineering firm should request any missing data and 
require a third party to supplement information such as weather and envi-
ronmental factors. This document will be reviewed by the owner carefully 
and can be amended until it satisfies the two parties.
At this stage, it is important to make sure that both the owner and the 
engineering firm have the same concept and there is a complete agreement 
among all the technical aspects. In the preparation of any drawings, we are 
now in the FEED studies, in which the drawings should be delivered to 
the owner to review and give input. The owner and the engineering firm 
should agree on the number of reviews of the document, and, if it goes over 
the specific time, it is assumed that the owner has accepted it. This is very 
important in controlling project time.
This phase may take a number of months in the case of large projects, 
and, therefore, the technical office of the owner must have a qualified engi-
neer with experience for controlling costs and follow-up time according to 
the schedule agreed upon in advance. We may need to consult a specialized 
engineer in planning who is the Planner Engineer.

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How to Manage Oil and Gas Projects 15
The engineer should be specialized in cost control, the estimated cost of 
the project, and the expected time, which is comparable in the feasibility 
study.
With the passage of time, clearly selected the equipment, and the project 
layout in its final stage, the project cost estimate will be more precise until 
things are nearer to the end of the initial studies. Then, one can obtain the 
nearest possible accuracy of the cost of the project as a whole.
It is worth mentioning that in investment projects, such as petroleum 
projects, savings in time bring a big return for where the return of income 
or expense is calculated by the day.
It’s imperative that we note here that, at this stage, one should not over-
look the way in which to determine the maintenance of the buildings’ and 
the facilities’ foundation in oil and gas plants in the future, which can be 
done by establishing the age of the structure and defining the structure 
lifetime, type of structure, and the ways of maintenance. The project site 
itself and the surrounding environment must be considered to determine 
the ways to protect it from weather, reducing the cost of maintenance over 
time by selecting different methods of maintenance.
For example, you can protect a reinforced concrete foundation from cor-
rosion by protecting the reinforcing steel, for example, through a system of 
expensive protection at the beginning of the construction with periodic 
low-cost maintenance.
On the other hand, we can use a low-cost alternative during construc-
tion and high-cost regular maintenance as a simple example if we don’t use 
any external protection system.
The structure, the mode of operation, and the maintenance plan all have 
an impact on the preliminary design.
For example, in power stations we must ask whether the water tank can be 
repaired, maintained, or cleaned. To answer this question, you must decide 
if it needs additional tanks as standby for maintenance purposes or not.
In this phase, many other initial design decisions must be made, and 
therefore this stage, as previously mentioned, requires high experience, 
since any error would lead to major problems during operation, which 
could cost a lot of money and could be prevented by a low-cost solution in 
this phase.