Project Management in the Oil and Gas Industry

8.1.1 The Risk Management Process
The Project Management Institute (PMI) uses the systems approach to risk 
management found in the Guide to the PMBOK. The risk process is divided 
into six major processes:
1. Risk management planning
2. Risk identification
3. Risk assessment
4. Risk quantification

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5. Risk response planning
6. Risk monitoring and control
These major processes will be discussed in the following section.
8.2 Project 
Risks
After completing the time schedule, the potential risk will be more obvious. 
Knowledge of the risks that may be faced during the project is extremely 
important for the project manager, as he or she is responsible for identify-
ing the activities of higher risk impact on the overall project implementa-
tion, which will either increase the duration or the cost.
Therefore, the project manager should review the planning schedule 
and identify areas of planning that contain high risks, as known from the 
following:
1. Tasks on the critical path
2. Tasks that need a long time period in which to be executed
3. Tasks that have little overtime
4. Activities that start with the beginning of other activities
Time
Cost
Quality
HSE
Uncertainty
Figure 8.1 Sources of Uncertainty.

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Project Management in the Oil and Gas Industry
5. Tasks that need many individuals for their execution
6. Complex tasks
7. Activities and tasks that need condensed training
8. Tasks that need new, advanced technology 
After you select the tasks that would cause risk to the project, then you 
will need to identify and plan the necessary steps to implement those tasks 
and how to follow up on implementation daily and assign reasonable per-
sons who will be responsible for follow-up in that stage of the project.
In order to have a sense of high-risk activities, let us consider the exam-
ple of pouring concrete in Chapter 3 and answer the following question: 
what are the risk activities? 
One can find that the highest risk activity is the excavation, as it needs a 
long duration in execution and it is on the critical path. Therefore, it has a 
high probability of delay and, consequently, it has a high potential impact 
on the complete project schedule. 
In any project, the longest time period activity located on the criti-
cal path is the most risky activity in the project. On the other hand, the 
machines and mechanical equipment are frequently coming from outside 
the project country, so the delivery of the equipment is most critical and an 
expected risk is high. In addition to that, in most cases, many other activi-
ties depend on the delivery of this equipment onsite. 
These activities have a high-risk assessment, as they will be out of full 
control. The probability of delay is high and also has a direct impact on the 
project completion time.
The success of the project means that the project team succeeded in 
achieving the objectives of the project on a specific time schedule and 
budget. It is known that there is nothing specific in nature. For example, 
specific costs, the time period, and the objectives of the project can increase 
and decrease. It is worth mentioning, that these three elements affect each 
other, so the success of the project requires each element of the project to 
work cohesively, as presented in Figure 8.2.
Per the probability theory that was discussed in Chapter 2, the probabil-
ity of success is small because all the occurrences of achieving the project 
objectives within the time and cost should happen. Therefore, our goal is 
to locate our project in this zone of intersection.
There are many areas in the project that are not specific and these are 
sources of risks, which can be any of the following:
• Activities of a long period of time and on the critical path
• A lack of identification of the project objectives

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The History of Graphene 291
• A non-competent project manager
• An inaccurate cost estimate
• A bad atmosphere, in general, in the project
• Achieving customer satisfaction 
• A rapid change in resources during time periods, as shown 
in Figure 8.3
Project target
Time
Cost
Project 
success