Investigation into the current project risk management practices within the Libyan oil and gas industry

Abstract

The continued increase in the world’s population means increasing global energy demands. According to the best estimates available, hydrocarbons will be the main contributor to meet these energy needs. However, oil and gas projects pose significant risks. The literature shows that many projects in the industry fail as a result of improper risk management practices. This research paper focuses on Libya, an important player in fulfilling the world’s energy demands, where the oil and gas industry is crucial to the national economy. Given the conditions existing in Libya, appropriate project risk management for the oil and gas industry needs is important. The aim of this paper is to investigate the current project risk management practices in the oil and gas industry in Libya. Thirteen semi-structured interviews with top managers, project engineers and advisors were undertaken to achieve this aim. The results show that awareness of the concept of project risk management is still very low in Libya and there is a lack of project management culture and risk management in particular. The paper also demonstrates that although these practices are already being applied to some extent, this relies on the prior knowledge and experience of specific individuals, rather than on a systematic, documented procedure. The lack of financial resources and the shortage of experienced and qualified personnel due to the country’s current situation and as well as a lack of clear organisational vision within the oil and gas industry in Libya, all limit the implementation of effective project risk management.