PROJECT XXX

PROJECT RISK MANAGEMENT

WORKSHOP
Location
Date
Probability / Likelihood

1 2 3 4 5
Very Low Low Medium High Very High
0 - 5% 5 - 20% 20 - 50% 50 - 80% 80 - 100%

Impact:
5 10 15 20 25 5
100% 1463
200

95% 1294

90% 1254
180
4 8 85% 1233
12 16 20 4
80% 1215
160

75% 1203

140
3 6 70% 1191
9 12 15 3
65% 1181

60% 1173
120

Cumulative Frequency
H1190 - Engineering/Manufacturing MOBO/Caisson - All 44%
55% 1166

2 4 6 8 10 2

Hits
50% 1154
100
H1760 - Engineering/Manufacture of ALM 30%
45% 1147

80 40% 1140 MOBO/Caisson - First One For Delivery

A2360 - Engineering/Manufacturing 24%

35% 1132

60
1 2 3
H1034 - Engineering/Manufacture Xtree Systems #1through #11 - All
30% 1124 4 5 22% 1
25% 1117
A2350 - Engineering/Manufacture Xtree Systems - First One Ready far Delivery 13%

40 20% 1105

15% 1096 N1415 - SCM Design & Manufacture 10%

20 10% 1082

N1412 - 2nd thru 17th SCM deliveries 7%

5% 1064

Key Partner for Successful Project Outcomes

0 0% 1008
1100 1200 1300 1400 T1912 - Receive SBM C&S responses to CTRs 6%
Distribution (start of interval)

F1004 - Final Flow Assurance Strategy Report Out 4%

A1870 - Issue Draft Report (IPA) 4%

Facilitator
Job Title

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SAFETY BRIEFING / SAFETY MOMENT

 Fire Exits ……? Fire alarm testing scheduled for ?

 Emergency Response Procedures
 We are all responsible for safety.

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AGENDA

 Safety Moment
 Background / Boundaries
 Project Objectives / Value Drivers
 Workshop Process & Objectives
 High level introduction to the Risk Management process
 Brainstorming

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BACKGROUND, BOUNDARIES

To be completed

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PROJECT OBJECTIVES/VALUE DRIVERS

To be completed

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WORKSHOP OBJECTIVES & PROCESS

 High Level Introduction to the Risk Management System

 Review current and identify new Up- and Downside Risks relating to
Project XXX
 Review pre-identified R&O’s by ECOP+T categories
 Closing risks/opportunities that are no longer applicable or valid
 Identifying new risks/opportunities at the end of each category
 Agree Risk Owners
 Time permitting, we can define & assess the new risks

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IN (A NUT-) SHELL…..

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WHAT IS A RISK MANAGEMENT SYSTEM

The Management of risk requires that:

 Risks are identified;

 Their likelihood and consequence assessed;

 Responses are planned and implemented; and

 There is an on-going process of monitoring, appraisal and re-assessment, leading

to improvement.
It also requires :
 Communication and understanding of the risks at the appropriate levels in the
organization, and
 Enabling tools:

Risk Management System (RMS) =

Process + Organizational Framework + Tools
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 THE RISK MANAGEMENT PROCESS

Risk Management is a continuous process that applies to every stage of the project.

IDENTIFY & ASSESS SELECT DEFINE EXECUTE OPERATE

Each risk must have an owner

Responses must be resourced

Are responses effective ?

Are contingency plans needed ?

Treat/Terminate/Transfer/Terminate

The process loop repeats itself for each identified risk,

during all phases of the Project Life-cycle

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ROLES & RESPONSIBILITIES

 Management – Sets objectives, resources risk management system,

endorses RAM
 Risk Coordinator – Facilitates the risk management process, ensures
quality of & reports risk information
 Risk Owner – Describes, assesses & plans responses for ‘his/her’ risks,
tracks progress, reviews risk, improves responses, closes risks & keeps
records in register
 Action Owner – Executes ‘his/her’ actions as intended and records status
in register
 Team Member – Identifies risks & feeds back effectiveness of risk
responses

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DEFINITIONS: RISKS VS ISSUES

The Risk Register should ONLY contain Risks, NOT:

 Issues, and/or Worries / Concerns / Items that are “normal business”

Risk:
 Possible future event which, if it occurs, would
affect project objectives either negatively (risks) or
positively (opportunities).

Issue:
 Has a 100% probability of occurrence and hence is not a risk

 A certainty that is evaluated and managed differently than a risk

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DEFINITIONS – RISKS VS ISSUES
Risk Example:
 It is the start of the day and it is partly cloudy.
 You check the weather forecast and see there is a 50% chance of thunderstorms today.
 The risk event is a thunderstorm, you have an estimate of probability and the
consequence is you get wet.
 Being prudent you decide to take an umbrella with you in case the risk occurs.
 Your personal Project plan has an identified contingency plan – the umbrella.

Issue Example:
 Now lets assume you look out of the window and see it is raining heavily.
 The fact that it is raining is no longer a risk, but a certainty.
 It is an Issue and you’d better actively manage your response.
 You can try to deny the Issue but you will only get wet.
 Failing to manage your project issues is just plain stupid!
 Worth pointing out the frequency on which people in any kind of project deny the
rain and go out hoping to dodge the raindrops in a downpour!!!
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 STRUCTURED RISK DESCRIPTION

Structured Three Part Risk Statement helps to clearly distinguish between

“Cause”, “Event” and “Consequence”, e.g.

 “As a result of <definite cause>, <uncertain event> may occur, which would lead to
<consequences for the project objective(s)>”
 As a result of adverse weather conditions, …you may get caught up in the rain,
which would lead to you getting wet and/or being late for a meeting etc.

Cause Consequence
Upside

Range of outcomes
Risk Event
Uncertainties, Threats
Issues/Opportunities

Uncertain
Event

Prevention Recovery Downside

Actions Actions

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Risk Responses 01/01/2024 13
 RAM EXAMPLE

PROBABILITY
CONSEQUENCES TO PROJECT OBJECTIVES 0-5% 5-20% 20-50% 50-80% 80-100%

Production /
Cost / Benefit1 Schedule 2 Ultimate Recovery HSSE Quality Legal Financing Relationships 1 (VL) 2 (L) 3 (M) 4 (H) 5 (VH)
Availability 3

Financing terms not

Major legal exposure
> 4 Mths > 10 million barrels of acceptable. Credit
> 50 USD Mil Substantial or total Non-conformance of with potential to result Breakdown in high-
5 (VH)
(>5% of Capex)
(>10% of Execution
loss of operation
oil equivalent
critical systems in major impact on
standing of parties
level relationships CRITICAL
Schedule) involved not
the company
acceptable

Significant legal Debt terms impact

2.4 - 4 Mths 5 - 10 million barrels Non-conformance of exposure present with Group targets. Credit Significant problems
30 - 50 USD Mil Partial or temporary
4 (H)
(3 - 5% of Capex)
(6 - 10% of Execution
loss of operation
of oil equivalent major functional potential material standing parties in high-level SEVERE
Schedule) systems impact on the involved require relationships
company guarantees

Debt terms have

Use Standard Risk Differences in high-
0.8 - 2.4 Mths Partial shut down of 2 - 5 million barrels of Gaps in knowledge minor impact on
10 - 30 USD Mil Assessment Matrix Non-conformance of level relationships or
3 (M) (2 - 6% of Execution operation (can be oil equivalent and/or controls over Group targets. Credit MATERIAL
IMPACT

(1 - 3% of Capex) for HSSE minor systems breakdown of minor

Schedule) restarted) minor aspects of law standing parties
level relationships
involved questionable

Significant differences
0.4 - 0.8 Mths 1 - 2 million barrels of Reasonable Minor credit, fund
5 - 10 USD Mil Sufficiently meeting with minor level
2 (L)
(0.5 - 1% of Capex)
(1 - 2% of Execution Brief disruption oil equivalent
the specification
knowledge - intention availability and/or debt
relationships which SMALL
Schedule) to be legally correct terms issues.
can be overcome

Minor credit, fund

< 0.4 Mths < 1 million barrels of Confident in
< 5 USD Mil No disruption to Substantially meeting availability and/or debt Mutually supportive
1 (VL) (<1% of Execution oil equivalent knowledge of law no
(< 0.5% of Capex) operation the specification terms issues (normal with minor differences
Schedule) dispute likely
work)

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RISK LEVELS & RESPONSE STRATEGIES

Severity
Response Strategy
Level
Requires urgent attention to reduce risk to an acceptable
Red level. Project Manager to ensure that risk is pro-actively
managed.
Requires continuous attention until risk satisfactorily
Orange resolved. Leadership Team to ensure that risk is actively
managed.
Requires management by risk owner to ensure risk does not
Yellow increase in severity.

Needs some monitoring to ensure that risk stays at

Green acceptable level.

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BRAINSTORMING AGENDA

Total of xx pre-identified risks

 Political – x

 Economic - x

 Commercial - x

 Organisational - x

 Technical – x

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WORKING SESSION PROCESS

 We will work off the pre-identified list of risks as per agenda

 Try NOT TO GET “STUCK” discussing risks in detail. We only want to:

 Confirm if they are valid (y/n)

 Agree a short and clear risk title (Risk Event)
 Confirm / Assign a Risk Owner (who ?)
 At the end of each “Category”, we will brainstorm for any NEW risk
items for 10 mins, each individual should identify at least 1 up- and 1
downside risk
 For these new Risks, focus on the Title (Risk Event)

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WORKSHOP RULES

 Accountability for Safety applies here too

 Be open & honest

 Identify Risks & Opportunities – avoid problem solving

 Challenge the obvious – there are no dumb questions

 Use simple language – no abbreviations

 One person speaking, avoid side discussions

 Act as colleagues (no rank in room)

 Return from breaks on time

 Turn cell phones off / on silent

 Dont complaine abut se fazilitator’s speling

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TECOP PERSPECTIVES

Subsurface
Subsurface Infrastructure
Infrastructure
Surface
Surface Schedule
Schedule
T echnical
echnical Technology
Technology Operability
Operability

Risk and Opportunity Management

Technical
Technical integrity
integrity Costs
Costs
HSE
HSE

Life-
Life-cycle
Life- cycle
cycle costs
costs Terms
Terms
E conomic
conomic
Schedule
Schedule &
Valuation
& Phasing
Phasing
Valuation Method
Method
Exit
Exit strategy
strategy
Regret
Regretcosts
costs
VOI
VOI
VOI

PSC
PSC && Fiscal
Fiscal Regime
Regime Legal
Legal
C ommercial
ommercial
Contracting
Contracting
Contracting
Financing
Financing
Financing
Competition
Competition
Market
Market
Business
Business controls
controls Liabilities
Liabilities

Structure
Structure Govenance
Governance
Govenance

O rganisational
rganisational
Resources
Resources
Competencies
Competencies
Knowledge
Knowledge
Systems,
Systems, IT
Procedures
Procedures
IT

KnowledgeManagement
Management
Management Interfaces
Interfaces

Government
Government Reputation
Reputation
Stakeholders Community
P olitical-
Stakeholders Community
olitical Societal
olitical- Societal Local
Local content
content Employment
Employment
Regulation
Regulation Aspirations
Aspirations
Security
Security Social
Social

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Copyright of INSERT COMPANY NAME HERE 01/01/2024 21
 RISK MANAGEMENT ALIGNMENT WITH
GOVERNANCE & DECISION RESPONSIBILITY

Agree means: Risk Response Management

1. The risk is valid and should Severity Agree Review Monitor / Manage
be included in the Risk
Register. Top Risks RTVP DE / BOM Quarterly review and progress
reported during scheduled
2. The risk severity (both pre- DRB session
and post-mitigated) and
response strategy are Critical DE / BOM PM Quarterly review and progress
appropriate. reported during scheduled
DRB session; resourced by
Project Manager
3. Risk mitigation plans will be
resourced appropriately.
Severe PM PLT Periodic review and report by
4. Risk information will be exception during scheduled
communicated as necessary to LT session; resourced by
Project Manager
provide transparency.

Review is done by the supporting Medium Project Team Sub Team Lead Periodic review to assess
teams, in preparation for Lead growth potential; resourced
by Project Team Leads
agreement by the appropriate
Leader/Decision Executive.
Low Sub Team Lead Risk Owner Periodic review to assess
growth potential; resourced
by Project Team Leads

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