How to use RiskyProject software for project risk management and risk analysis in oil and gas industry. For more information how to perform schedule risk analysis using RiskyProject software please visit Intaver Institute web site: http://www.intaver.com. About Intaver Institute. Intaver Institute Inc. develops project risk management and project risk analysis software. Intaver's flagship product is RiskyProject: project risk management software. RiskyProject integrates with Microsoft Project, Oracle Primavera, other project management software or can run standalone. RiskyProject comes in three configurations: RiskyProject Lite, RiskyProject Professional, and RiskyProject Enterprise.

1. How to Perform Project
Risk Management for Oil
and Gas Projects
Intaver Institute Inc.
303, 6707, Elbow Drive S.W, Calgary, AB, Canada
Tel: +1(403)692-2252
Fax: +1(403)459-4533
www.intaver.com

2. Introduction
• Intaver Institute Timeline
– 2002: Established
– 2004: V.1 RiskyProject
– 2009: v 3 Integrated Risk Register
– 2012: v 5
• RiskyProject
– Full Project Risk Management
Lifecycle
– Integrated Risk Register
– Risk Matrix, Risk Planning
+
– Quantitative Monte Carlo Cost and
Schedule Risk Analysis
05/07/14 2013 Intaver Institute 2
Clients

3. Gorgon Natural Gas Project
05/07/14 2013 Intaver Institute 3
Project Cost Estimate in Billions A$
Date of cost estimate
A three-train liquefied natural gas (LNG) facility on Barrow Island
(Australia) that will produce 15.6 million metric tons of LNG per year.

4. Corporate Portfolio Management Process
05/07/14 2013 Intaver Institute 4
Project Cost and
Schedule risks and
uncertainties
Geological and other
Uncertainties affecting
production
Price Uncertainties
Other Risks and
Uncertainties:
-Political risks
-Uncertainties in
Royalties regimes
-….
Economic
Analysis of the
Projects
Corporate
Portfolio
Management
Strategic
Decision
Quantitative cost and schedule risk analysis is an
important component of portfolio management

5. Risk Management Affects Project Profitability
05/07/14 2013 Intaver Institute 5
Full circle cost of gas
$/Mcf
Quantitative risk analysis provides realistic risk adjusted and risk mitigated cost estimates

6. Identifying and Managing Critical Risks is Key
05/07/14 2013 Intaver Institute 6
Risk
Quantitative risk analysis identifies and prioritizes critical risks

7. Which risks are critical?
05/07/14 2013 Intaver Institute 7
Risk 3Risk 3
Risk 4Risk 4
Risk 1Risk 1
Risk 5Risk 5
Risk 2Risk 2
Risk 1Risk 1
Risk 2Risk 2
Risk 3Risk 3
Risk 4Risk 4
Risk 5Risk 5
Schedule
risk
CostRisk
SafetyRisk
LegalRisk
Quality
Risk
……………..
Risk
Enviromen
talRisk

8. Tim
e
DependentCosts
CostRisk
Time is Money: Cost and Schedule Risks
05/07/14 2013 Intaver Institute 8
• Schedule risk drives
Costs due to time
dependent resource
costs
• 40% -70% cost risk is
schedule driven
Schedule
risk

9. Input 1: Project Schedule
Input 2: List of Risks (Risk Register)
Assign Risks to Project
Tasks and Resources
Perform
Analysis
Risk Events Approach

10. Schedule
05/07/14 2013 Intaver Institute 10
Import project schedule from project management tool
(Primavera, MS Project, etc..

11. Costs
05/07/14 2013 Intaver Institute 11
Schedules can include cost data for quantitative risk analysis of fixed costs

12. Resources
05/07/14 2013 Intaver Institute 12
Resources with rates are loaded with the project schedule to allow for risk
analysis of time dependent costs

13. Risk Register
05/07/14 2013 Intaver Institute 13
Project risk register is integrated to the project schedule and
cost

14. Risk Assignment
05/07/14 2013 Intaver Institute 14
Task R1 R2 R3 R4 R5 R6
Installing Microsoft Seismic
monitoring
x x
Deliver frac fleet and install
equipment
x
Deliver rig and equipment x
Well 1,2,3 (share common risks) x
Rig Mobilization x
Drilling x x x x
Installing Service Rig x
Completion (8 stages fracing) x x
Risks are assigned to project activities

15. Risk Assignment Interface
05/07/14 2013 Intaver Institute 15
30 % chance that risk
causes a delay and
increase in cost of drilling
Risk Assigned to task
‘Drilling’
Risk probability and cost and schedule impact are assigned to
activities

16. Run Monte Carlo Simulation
05/07/14 2013 Intaver Institute 16
Monte Carlo simulation prioritizes risk based on impact on cost, schedule or
other parameters

17. Results of Analysis
05/07/14 2013 Intaver Institute 17
Monte Carlo simulation results for cost and schedule can be viewed as
histograms or cumulative probability

18. Risk Adjusted Project Schedule
05/07/14 2013 Intaver Institute 18
Schedule with
risks
Schedule without
risks
Arrows show risk
assignments

19. Project Cost
05/07/14 2013 Intaver Institute 19
Schedule with
risks
Schedule without
risks
Results of quantitative cost risk analysis are shown on the Cost view

20. Risk Planning – Mitigation Plan
05/07/14 2013 Intaver Institute 20
Risk response plans can be plotted on a Risk Mitigation Waterfall chart

21. Pre and Post Mitigation Risk Scores
05/07/14 2013 Intaver Institute 21
Pre-
mitigation
Post-
mitigation

22. Risk Planning
Risk: Mechanical Problem with instrument
05/07/14 2013 Intaver Institute 22
Post Mitigation $16, 734, 906Pre-Mitigation Cost 17, 178, 397
Risk response plans can reduce the expected cost of the project

23. RiskyProject Enterprise
05/07/14 2013 Intaver Institute 23
Enterprise Risk
Database:
Schedules,
Risks,
Mitigation Plans
RiskyProject Professional
RiskyProject Lite
RiskyProject Web

24. Future Reading
• Virine, L. and M. Trumper. 2007 Project Decisions: The Art and Science. VA: Management
Concepts
• Virine, L. and M. Trumper. 2013. Project Think: Why Good Managers Make Poor Project
Choices. England: Gower Publishing
• P. Leach. 2005. Late and Over Budget: Why Projects Always Seem to Take Longer and
Cost More Than Planned. Projects & Profits, Vol. V Issue - XI, November 2005
• http://www.project decisions.org
• http://www.intaver.com/index-whitepapers.html
• http://www.risk-doctor.com/
• http://www.projectrisk.com
Contact
Michael Trumper
mtrumper@intaver.com
403.692.2252
Intaver Institute Inc.
www.intaver.com
05/07/14 2013 Intaver Institute 24