Using probability impact matrix (PIM) in analyzing risk factors affecting the success of oil and gas construction projects in Yemen

Research output: Contribution to journalArticle

Abstract

Purpose: This study aims to identify and assess the significant risks in Yemen oil and gas construction projects based on their risk rating (impact and probability) by using probability–impact matrix (PIM). Design/methodology/approach: In total, 51 risk factors that might affect construction projects in the oil and gas sector are defined through a detailed literature review and expert judgment. The risk factors were tabulated in a questionnaire form, which was sent to a total of 400 participants asking their contribution in identifying the risk matrix for the risk factors in terms of impact and probability of occurrence during the project life cycle. Five zones were used in the matrix according to the degree of risk factor’s severity on the success of the project. These zones are light green, dark green, yellow, light red and dark red. Findings: The PIM analysis for risk factors found that five factors are located in the dark red zone, as top risks factors have a very high impact and very high probability of occurring; 40 factors are located in the light red zone; six factors are located in the yellow zone; and no factors are located in the green zone (light and dark), which is considered an indication of the importance of risk factors under study and their impact on the success of construction projects in the oil and gas sector. Moreover, the factors under feasibility study and design and resources and material; are the most categories effect on project success. Research limitations/implications: The research was limited to the oil and gas construction projects in Yemen. Practical implications: Practically, this study highlights the top risk factors in oil and gas construction projects, which might cause an adverse effect on project success in Yemen. Classification and ranking of these factors by using the risk matrix provide the basis for risk response planning to enhance the chances of project success. Originality/value: This paper identifies the matrix for risk factors affecting the success of construction projects in the oil and gas industry in Yemen. There is a significant contribution expected from this research, especially for companies operating in the oil and gas sector and other organizations that plan to invest in this field, in addition to expected benefits for the Yemeni Government and researchers because of lack of research in this area.

Original languageEnglish
JournalInternational Journal of Energy Sector Management
DOIs
Publication statusAccepted/In press - 1 Jan 2019

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Gases
Yemen
Construction project
Gas
Oil
Risk factors
Oils
Factors
Gas industry
Life cycle
Project success
Planning
Industry

Keywords

  • Construction projects
  • Oil and gas
  • Probability–impact matrix
  • Risk factors
  • Yemen

ASJC Scopus subject areas

  • Energy(all)
  • Strategy and Management

Cite this

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title = "Using probability impact matrix (PIM) in analyzing risk factors affecting the success of oil and gas construction projects in Yemen",
abstract = "Purpose: This study aims to identify and assess the significant risks in Yemen oil and gas construction projects based on their risk rating (impact and probability) by using probability–impact matrix (PIM). Design/methodology/approach: In total, 51 risk factors that might affect construction projects in the oil and gas sector are defined through a detailed literature review and expert judgment. The risk factors were tabulated in a questionnaire form, which was sent to a total of 400 participants asking their contribution in identifying the risk matrix for the risk factors in terms of impact and probability of occurrence during the project life cycle. Five zones were used in the matrix according to the degree of risk factor’s severity on the success of the project. These zones are light green, dark green, yellow, light red and dark red. Findings: The PIM analysis for risk factors found that five factors are located in the dark red zone, as top risks factors have a very high impact and very high probability of occurring; 40 factors are located in the light red zone; six factors are located in the yellow zone; and no factors are located in the green zone (light and dark), which is considered an indication of the importance of risk factors under study and their impact on the success of construction projects in the oil and gas sector. Moreover, the factors under feasibility study and design and resources and material; are the most categories effect on project success. Research limitations/implications: The research was limited to the oil and gas construction projects in Yemen. Practical implications: Practically, this study highlights the top risk factors in oil and gas construction projects, which might cause an adverse effect on project success in Yemen. Classification and ranking of these factors by using the risk matrix provide the basis for risk response planning to enhance the chances of project success. Originality/value: This paper identifies the matrix for risk factors affecting the success of construction projects in the oil and gas industry in Yemen. There is a significant contribution expected from this research, especially for companies operating in the oil and gas sector and other organizations that plan to invest in this field, in addition to expected benefits for the Yemeni Government and researchers because of lack of research in this area.",
keywords = "Construction projects, Oil and gas, Probability–impact matrix, Risk factors, Yemen",
author = "Kassem, {Mukhtar A.} and {Muhamad Azry}, Khoiry and Noraini Hamzah",
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AB - Purpose: This study aims to identify and assess the significant risks in Yemen oil and gas construction projects based on their risk rating (impact and probability) by using probability–impact matrix (PIM). Design/methodology/approach: In total, 51 risk factors that might affect construction projects in the oil and gas sector are defined through a detailed literature review and expert judgment. The risk factors were tabulated in a questionnaire form, which was sent to a total of 400 participants asking their contribution in identifying the risk matrix for the risk factors in terms of impact and probability of occurrence during the project life cycle. Five zones were used in the matrix according to the degree of risk factor’s severity on the success of the project. These zones are light green, dark green, yellow, light red and dark red. Findings: The PIM analysis for risk factors found that five factors are located in the dark red zone, as top risks factors have a very high impact and very high probability of occurring; 40 factors are located in the light red zone; six factors are located in the yellow zone; and no factors are located in the green zone (light and dark), which is considered an indication of the importance of risk factors under study and their impact on the success of construction projects in the oil and gas sector. Moreover, the factors under feasibility study and design and resources and material; are the most categories effect on project success. Research limitations/implications: The research was limited to the oil and gas construction projects in Yemen. Practical implications: Practically, this study highlights the top risk factors in oil and gas construction projects, which might cause an adverse effect on project success in Yemen. Classification and ranking of these factors by using the risk matrix provide the basis for risk response planning to enhance the chances of project success. Originality/value: This paper identifies the matrix for risk factors affecting the success of construction projects in the oil and gas industry in Yemen. There is a significant contribution expected from this research, especially for companies operating in the oil and gas sector and other organizations that plan to invest in this field, in addition to expected benefits for the Yemeni Government and researchers because of lack of research in this area.

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