Turbomachinery project management framework in oil and gas industry in Malaysia

Abstract

Turbomachinery is a crucial equipment for oil and gas (O&G) facilities. Therefore, efficient and effective management of turbomachinery project is very critical towards the overall success of any O&G project. Nevertheless, studies on turbomachinery project management are limited and only focus on overall O&G project execution. There is no established framework related to management of turbomachinery projects found in the literature although Petroliam Nasional Berhad (PETRONAS), the Malaysian national O&G company has procured more than 100 turbomachineries with some success and failure. Hence, this study is undertaken with the aim of developing a framework of turbomachinery project management in O&G industry. From a population of 11,354 O&G industrial players in Malaysia, intended sample is chosen based on sample size determination table and 95 percent confidence level. Through a survey on the sample of 183 respondents and expert focus group interview with five turbomachinery professionals with minimum 12 years of experience, this study finds that: turbomachinery is always identified under project critical path; problems in turbomachinery project management include turbomachinery process selection and configuration, availability of detailed vendor data and developing turbomachinery total cost of ownership (TCoO) or life cycle cost (LCC) ; and presence of client during kick off meeting, proper procurement strategy and tender plan, as well as well-defined project feasibility study and concept are expected to solve the aforementioned problems. Finally, using the combination of problem-solution bow-tie diagram and Critical Success Factors (CSFs) principle table, a framework of turbomachinery project management in O&G project in Malaysia consisting of 9 problems, 13 solutions and 43 CSFs are grouped into seven related factors: effective project management, human, internal management, technical and contract related, Original Equipment Manufacturer (OEM) dependency, progression and external related factors being developed. This framework would enable the decision makers to take appropriate actions in achieving the desired outcomes in turbomachinery project management, thus would lead to the success of turbomachinery project in O&G industry, which is prolifically known as the most expensive industry worldwide.