Project Management in the Oil and Gas Industry

8.3 Risk 
Assessment
The risk assessment procedure is shown in Figure 8.4. The first step is to 
define the expected risks during the project execution and then analyse 
this risk. The last step is to prioritize these risks.
Each project has a risk, no matter what the project is. We focus on the 
risks affecting the management of the project and, by knowing these risks, 
we can set priorities to develop solutions for those risks and to mitigate 
them.
In order to assess these risks, we must answer the following questions 
accurately and impartially:
• What is the risk exactly?
• How do these risks affect the project? 
• What can be done to reduce the impact of the risks?
Now we will discuss a method for determining the risks in a different 
way than mentioned previously. We previously explained assessing the risk 
of a project as a whole by using a quantitative risk assessment methodology 
as a part of the feasibility study.
Risk assessment
Define expected risk
Risk analysis
Define priority
Figure 8.4. Risk assessment tools.

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Project Management in the Oil and Gas Industry
In this stage, the risks will be assessed by their effects on the objectives, 
time, and cost. Now we need an easy way to assess the risks practically. This 
method is called “qualitative risk assessment.”
In the case of oil and gas projects specific for offshore structures, the 
risk is very high to meet project time and cost as the construction off-
shore depends on the marine vessels, whose performance is affected by the 
weather. In the case of probability of high weather, it means the vessel must 
stop working, which means delay in time in addition to the accumulation 
of a standby fee for the vessel.
8.4 Risk