Updated: Jul 3rd, 2024

Barzan Gas Project Analysis Report

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Table of Contents

Introduction
Risk Analysis
Disaster Management Plan
List of References

Introduction

Barzan Gas Project is a massive investment that is a joint venture of ExxonMobil and Qatar Gas. The investment is worth $ 10.4 billion, and will be operated by RasGas Company Limited upon its completion.

In such a heavy investment, it is always necessary to determine some of the risks that the project may encounter when the plant is under construction, or when the plant becomes operational. Some of the risks may have serious financial and social consequences that may force such an ambitious project to be closed down. The research will focus on risk analysis and mitigation measures in this project.

Risk Analysis

Risk Identification, quantification and qualification

This project faces a number of risks that the project management team should understand in order to determine how to develop mitigation measures. According to Sharma (1994, p. 52), the process of identifying risks involves a clear understanding of all activities that are carried out at every stage of the project, and any possible eventualities that may cause some form of risks to the participants in the project (Dasgupta 2007, p. 81).

The project faces numerous risks from various environmental factors that can be classified into three classes. The classes of the risks include natural risks, technological risks and social risks. The table below identifies specific risks in the three classes and gives their qualification on the basis of their probability and impact in case they occur.

Risk	Probability	Impact
Natural risks
The coastal risks: Possible flooding, storm surge, erosion, and saltwater encroachment	There is a medium probability of occurrence. This project will have onshore and offshore plants. The onshore plant will be at risk of such natural disasters such as flooding and storm surge. The offshore plant may be at risk of saltwater encroachment into the machines, or strong storms at the sea	The impact is medium. In case such an event occurs, the damage will be huge enough to alter normal operations of the plants
Seismic forces: Seismic forces may have serious impact on the project, especially if the magnitude of the quake is strong.	Probability of the risk occurrence is low. This project will be based in Doha, Qatar. According to the report by Mukhopadhyay (2005, p. 49), Qatar is one of the regions in the world that is less affected by earthquakes. However, the changing environmental patterns may mean that this country can experience earthquakes.	The impact is high. In case the earthquake hits this region, the impact will be massive as structures will be destroyed and lives will be lost.
Contaminated groundwater: At the mines, there is a possible risk of contamination of the oil fields by ground water.	The probability of this occurring is low. Qatar is one of the arid areas in this region, and chances that the ground water may flood the oil fields leading to contamination are low.	Impact is low In case this takes place, the impact will be low because it can easily be managed by sucking the water.
Radioactive risks: Those engaged in construction or drilling processes may be exposed to some form of radioactive materials.	The probability of the occurrence is low. It is less likely that the workers at the facility in Doha may be exposed to radioactive substances when undertaking various tasks.	Impact is high When such radioactive substances are released, workers may be exposed to serious health problems.
Volcano eruptions: According to Mechler (2004, p. 118), sometimes minefields are always affected by volcano flows.	Probability of the occurrence is low. Doha is not known to be prone to volcanic eruptions. This means that there are minimal chances that this may take place at this facility.	High impact: Lava flows, rock fall, volcanic gas and volcanic ash may have devastating impact on human lives and structures.
Topographical risks: The facility may be affected by issues such as slops or landslides	The probability of the risk occurring is low. Given the geographical location of the plant, chances that such topographical risks may occur are low.	Medium impact: In case the risk occurs, the impact will vary depending on the magnitude
Technological risks
Technological risks may take place because of a failure of the equipments used in the construction, drilling, refining, or transportation of the products. The infrastructure may fail, and this may lead to damage of properties and loss of life.	The probability of occurrence is medium. The companies that have been contracted to undertake the construction process are of high reputation. RasGas, which will operate the facility, is also known for its efficiency. Based on this fact, it is believed that the probability of the structural failure will be reduced tremendously.	Very high impact: In case there is a structural failure, there is a high possibility of fire outbreak. This would result into massive destruction of property and loss of life.
Social risks
Social risks in this region may include kidnapping of workers or officials, terrorism, or environmental issues	Probability is high Terrorism in this region from such groups as al Qaeda is real. Environmental bodies may also challenge operations of this plant because of its environmental effects.	High impact If the issue of kidnapping and terrorism is not addressed, employees may fear working at the facility.

Risk quantification

Probability of occurrence	High			2, 8, 9
	Medium	5	1, 3
	Low	4, 6,	7	10
		Low	Medium	High
		Impact on the organization

Strategies to manage various types of risks

According to Hunter (2009, p. 39), the first step in managing risks within a plant is a detailed identification of the risks. In the section above, all the possible risks that may occur in this project have been identified and classified into three categories. The first category includes the natural risks. It is important to note that natural risks are beyond the control of human forces. For this reason, it is not possible to avoid such risks. The only measure that can be put in place is to develop mitigation measures just in case they occur.

RasGas Company Limited must be ready to deal with any of the above natural risks in the event that they occur. The preparedness of this firm will define how well it will be able to respond to the risks (Singh 2006, p. 70). Technological and social risks may be prevented before they can affect the normal operations of the firm. According to Rao (1998, p. 75), the ability of a firm to address social and technological risks largely depends on its management structure.

An explosion at the facility that is caused by a failed delivery system will be considered a direct failure on the part of top managers. This is so because they failed on their supervisory roles, and that is why they never realised that the system needed some repair or a complete overhaul. The following recommendations should be followed in order to address technological, social, and natural risks.

No.	Strategy
1	Identify the risks, quantify the risk, and determine the probability of its occurrence as done in the section above.
2	Treat each of the identified risk as independently as possible to minimise confusion when addressing the risk in case it occurs (Kibble 1998, p. 31).
3	Identify and purchase specific instruments that would be needed to address each of the individual risk.
4	Train and assign specific employees who will be responsible for disaster management within the facility.
5	Create awareness among all the employees on how they should respond to different disasters in case it takes place (Schneider 1995, p. 36).
6	The management should conduct regular supervisory on all components of this system.
7	A quality assurance team should be developed to help in regular inspection of the system (Satendra 2003, p. 77).
8	There should be a regular replacement of the infrastructure within the plant.
9	The firm should ensure that it meets its corporate social responsibility as a way of minimising social risks.
10	The firm should ensure that it follows all regulations set by different authorities in this country in its operations.

Assumptions

According to Raghavulu (2007, p. 30), sometimes it may be necessary to make some assumptions when defining risks within a given organisation. In this research, it was necessary to make some assumption in order to develop a comprehensive risk management plan. The following are some of the assumptions.

The project is prone to risks both at the construction stage and when it shall have started its operations.
The environmental factors within Doha closely define both natural and social risks that the plant may face.
Technological risks are defined by the management strategies of the firm, its technical capacity, and financial strength.

The above assumptions were necessary in order to determine the forces that may lead to the risks occurrences. For instance, an earthquake in Doha will have a direct impact on the facility.

Disaster Management Plan

Mapping the situation in terms of hazards, vulnerability and impact

Disaster management plan is important in defining the mitigation measures that can be used to address disasters in case they occur (Diwan 2010, p. 54). Mapping the situation involves identifying the hazards, determining the vulnerability of the firm to the hazards, and determining the impact in case the hazard is not adequately addressed. According to Gupta (2003, p. 46), a given hazard may not affect an organisation, unless the organisation is vulnerable to the risk.

When mapping the situation, it is important to determine how vulnerable the organisation is to the hazard. For example, when planning for the natural disasters, cartographic methods can be used to determine vulnerability and the response strategies (Palanithurai 2009, p. 31). Cartographic maps can be integrated with GIS in order to determine the geographical coverage of some of the natural disasters in case they occur.

The aerial photography, satellite imagery, hazard maps, the vulnerability maps, and the impact maps should be clearly defined in order to assist in emergency planning within the facility (Coppola 2011, p. 54). It is also necessary to engage the community when addressing such problems as terrorism in the region. Below is the vulnerability chart that the management should take note of during its operations

The Vulnerability chart

Risks	Probability	Impact on Human	Impact on Property	Impact on Business	The Internal Resources	The External Resources	Total
Risks	5 <—–>1	High 5 <————–>1 Low			5 <——————>1
Natural risks	5	3	2	2	1	1	14
Process risks	5	2	3	3	2	1	16
Technological risks	5	2	3	3	4	3	20
Social risks	1	1	1	1	1	1	6

Loss estimation and resources inventory

In case an of an occurrence of the identified risks within this facility, there would be a serious damage of properties and loss of lives in case the response team fails to do the right job. The following are some of the estimated loss of resources within the plant in case of an earthquake disaster.

Casualties

The project currently employs 20,000 construction workers. It is estimated that about 190 people may dies because of the dangers posed by the construction equipments that are not yet fitted. About 5000 people may survive with serious injuries within the site, while another 8000 will survive with minor injuries.

The few who may escape without injuries are assumed to have been in safe locations. Assuming that an individual with low injuries will be given a compensation of £ 590, serious injuries £ 2100, and deaths, £ 21 000, this incident will cost an insurance firm £ 19210000.

Structural damage

Given that the construction is underway, in case a serious earthquake strikes, the better part of the building will have to be brought down. The damage on the structured can be estimated to cost about £ 5500000.

Communication management

The communication system should be highly advanced when planning a disaster response and management strategy. According to Shaw and Krishnamurthy (2009, p. 46), a plant should have a clear and reliable communication system that can be used to reach everyone in case of emergency.

Monitoring of the plan

As mentioned previously, it will be advisable for this firm to establish a monitoring unit that will be responsible for regular inspection of the infrastructure within the facility (Özerdem & Jacoby 2006, p. 78). This team should be able to identify structures that need repair and communicate this information to the top management for some actions to be taken (Singh 2000, p. 78). Their advice should be acted upon as soon as possible.

List of References

Coppola, D. 2011, Introduction to International Disaster Management, Elsevier Science, Burlington.

Dasgupta, R.2007, Disaster management and rehabilitation, Mittal Publishes, New Delhi.

Diwan, P. 2010, A Manual on disaster management, Pentagon Earth, New Delhi.

Gupta, H. 2003, Disaster management, Universities Press, Hyderabad.

Hunter, N. 2009, The Law of Emergencies: Public Health and Disaster Management, Elsevier, Burlington.

Kibble, D. 1998, Safety and disaster management in schools and colleges: A training manual, D. Fulton Publishers, London.

Mechler, R. 2004, Natural disaster risk management and financing disaster losses in developing countries, VVW, Karlsruhe.

Mukhopadhyay, A. 2005, Crisis and disaster management turbulence and aftermath, New Age International, New Delhi.

Özerdem, A. & Jacoby, T. 2006, Disaster management and civil society: Earthquake relief in Japan, Turkey and India, Tauris, London.

Palanithurai, G. 2009, Panchayats in disaster: Preparedness and management, Gujarat, Orissa, Andhra Pradesh, and Tamil Nadu with successful case studies, Concept Pub. Co, New Delhi.

Raghavulu, N. 2007, Disaster management, Cengage, New York.

Rao, N. 1998, Global strategies of clean environment, safe earth, disaster management, sustainable development and quality life: National and international obligations and priorities, Atlantic Publishers and Distributors, New Delhi.

Satendra, P. 2003, Disaster management in the hills, Concept Publisher Company, New Delhi.

Schneider, S. 1995, Flirting with disaster: Public management in crisis situations, M.E. Sharpe, Armonk.

Sharma, V. 1994, Disaster management, National Centre for Disaster Management, New Delhi.

Shaw, R. & Krishnamurthy, R. 2009, Disaster management: Global challenges and local solutions, Universities Press, Himayatnagar.

Singh, R. 2000, Disaster management, Rawat Publications, Jaipur.

Singh, R. 2006, Natural hazards and disaster management: Vulnerability and mitigation, Rawat Publications, Jaipur.

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