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Challenges Of Project Management In Oil & Gas Industry


Successful companies are continuously working towards to improve their general project management skills, especially skills in relation to the oil and gas industry. There is a shortage of technical talent in the industry, and is estimated to become more acute over the next decade as more experienced engineers retire, further complicating the issue.


As activities increases, more oil and gas production moves to frontier and unconventional resource areas, and projects become larger and more complex. For example, offshore facility in the Artic that is budgeted at more than $3 billion, and in South America, a $8.4 billion petrochemical complex that spread across the region.


A company will not be handling one project at a time, a portfolio can consist of hundreds of complex projects, prioritizing not only on financial goals and risks, but also based on the availability of resources (e.g. engineering talent). In order to manage the many contractors and suppliers of various projects, companies will aim to build up their internal engineering staff by as much as 80%.


Scoping projects is an important skill, especially for companies that are of smaller scale, especially when delivering large and complex projects. However, big projects such as upstream shale production projects are made up of several smaller projects, and such projects run the risk of over-engineering upstream production if they treat many small projects like a large one.


By following a robust project reference framework, companies can avoid the risk of cost and schedules overruns. Big companies gather technical input in the preliminary stage of the project, and incorporate them into the project’s framework to make sure it aligns with the organisation’s larger goals. Personnel will also engage stakeholders throughout the life of the project, from architecture and design through execution.


A successful project consists of the following: –


  • Formal project phases and checkpoints – decision checkpoints, or stage gates, mark the end of formal phases. Managers are expected to coordinate with stakeholders in decision making from one stage to the next.
  • Clear accountability – the roles and responsibilities of the project team should be clearly stated; they should have a shared interest in the project’s objectives, ensuring accountability.
  • Checks and balances between central functions and project teams – corporate functions will be in charge of staffing the best people, defining processes and ensuring control of managerial and technical activities. In turn, project teams must be able to make the decisions for project’s deliverables.
  • Constant review to measure project value and monitor risk – projects should be assessed continuously, not only at formal checkpoints and stage gates, to ensure that project is on track.
  • A good network in host country – some projects require project managers to source for goods and services from host country. It is important that managers seek to understand the host country’s goals through engaging policy makers to create long-term strategies that go beyond the supplier needs, but promoting best practices that help local industries meet global standards.
  • Risk and opportunities – companies have to consider not only risks, but also required to mitigate unexpected events. Risk identification and evaluation is an ongoing process taking a systematic perspective that considers projects, their phases and relevant risks.


Auditing Project Performance & Controlling Projects is a 3-day course that aims to aid project personnel learn how to audit baseline performance using the triple constraints of project management. Project success can be attained through auditing the limts on time, human resources, materials, budget, and specifications. For more information, please visit us at or contact us at


Opus Kinetic believes that people are why organisations are successful, and giving people the knowledge to perform well at their job is integral for success. We pride ourselves as the premier provider of knowledge, offering acclaimed in-house training, leadership training courses, oil and gas training courses, courses that target health safety and environment, etc. Our training courses are well researched and updated with the latest industry trends. For more information on our professional training programs, you can visit us at

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