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Quality Risk Management

in Oil & Gas Industry

Projects today are getting larger and more complex and several factors combined increase
the level of project-related risk within the sector. The challenge therefore is to manage the
political and other risks that are unavoidable in the industry. How well these risks are
analyzed and managed will often be key to a project’s success. The main techniques
proposed by Xylem are: condition-based monitoring, predictive maintenance, critically-
based maintenance, performance center or center of excellence.

Massimo Rebecchi, Xylem Srl President and Ceo

y multinational Client asked Xylem Decision Making Process, Value

to explore the Operational Risks of Information and Flexibility
faced by Construction companies
in today’s business and regulatory Many complex decision problems in petroleum
environment, and how the right exploration and production involve multiple conflicting
Minformation technology can help objectives. Under these circumstances, managers have
mitigate those risks. Operational risk is experienced at a growing need to employ improved and systematic
the corporate level, but these considerations mainly decision processes that explicitly embody the firm’s
focuses on what impacts can have every day on objectives, desired goals, and resource constraints.
construction plants activities. Over the last two decades, the advances in computer-aided
The purpose of this reflection is to encourage and decision making processes have provided a mechanism to
facilitate the development of a more systematic, improve the quality of decision making in modern petroleum Fig. 1 - Quality Risk
prioritized, risk-based approach to quality management industry. Walls (1996) developed a decision support model Management Process
to support the principles of “Good
Construction Practice” and to
complement existing quality practices,
requirements and standards.
Quality in this context is commonly
defined as fitness for purpose.
Construction activities are about
generating information to support
decision making while protecting the
safety and rights of participating
subjects. The quality of information
generated should therefore be
sufficient to support good decision
making.
Each step of the business process is
setting the stage for decision making
by one or more of the parties involved.
Quite a number of these decisions are
formalized by legislation and by
design applicable standards.
The challenge for oil & gas industry is
to manage the political and other risks
that are unavoidable in the industry
with effective returns.

IndustrIal Plants - May 2018
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