Curbing rework in offshore projects: systemic classification of risks with dialogue and narratives
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Rework arises in offshore projects due to errors and omissions, and this can significantly contribute to project cost and cause schedule overruns. Indeed, these additional and unnecessary costs can uncontrollably spiral to account for 25% of capital expenditure for offshore platform projects. Yet rework costs are frequently dismissed as isolated and rare instances of unfortunate circumstances and alien to normal practice. Original evidence stemming from this research indicates that cost and schedule overruns are a recurrent feature of offshore projects. Moreover, the risk of overruns are further exacerbated by increasingly complex commercial and contracting arrangements, technical challenges, changing local economic and regulatory conditions, and a shift towards projects being undertaken in peak oil frontier regions. To acquire new knowledge on the dynamics of offshore rework, the experiences of 23 oil and gas industry practitioners were captured using in-depth interviews. A risk classification matrix was subsequently developed in order to provide a frame of reference to mitigate future rework. Failing to give consideration to rework risks increases the potential for latent conditions to become embedded within organisational and project systems and processes. Consequently, the likelihood of failures, accidents or even catastrophes increases.
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Love, Peter; Smith, J.; Han, S. (2011)Cost and schedule overruns are norm in offshore hydrocarbon projects. With increasingly complex commercial and contracting arrangements, technical challenges, changing local economic and regulatory conditions and a shift ...
Love, Peter; Sing, Michael (2013)Rework arises due to design errors, changes and omissions during design and has been found to contribute to 52% of a project’s cost overrun. The statistical characteristics of rework costs experienced from contract award ...
Simpeh, E.; Ndihokubwayo, R.; Love, Peter; Thwala, W. (2015)© 2015 Taylor & Francis. Statistical methods for eliciting probability distributions were used to analyse the data collected from 78 construction professionals. The empirical distributions for rework costs were found to ...