Project Management By: Rahul Arora Click to edit Master

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Contents

Introduction Economic Outlook Market Overview Professional Engineering Services Service Chain Project Participants Project Management Procedures

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Profile

Flour Corporation

Fluor Corporation is a professional services company providing engineering, procurement, construction and maintenance, as well as project management services on a global basis. Established in 1912, now 43000 employees all over the world.

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Profile
Fluor operates in five major business divisions: Oil & Gas primarily serves of upstream oil and gas production, refining of downstream, petrochemical, and chemicals. Industrial & Infrastructure business line that focuses on transportation, wind power, mining and metals, life sciences, manufacturing, commercial, telecommunications, microelectronics, and healthcare.

Government support operations for different U.S. federal agencies such as U.S. Department of Energy, the U.S. Department of Homeland Security, and the U.S. Department of Defense.

Global Services customized engineering research and services such as process and methods betterment and performance improvement.

Power business division focused on providing full Engineering, 12/13/12 44 Procurement, Construction, and Management Services for power

World Economic Outlook

Global GDP growth trending 4% 2012/13 US GDP Growth rate at 2-3%. Growth in US is reviving. China with 2010 GDP at 10% and 2012 GDP at 8%. Not very major impact of recession Mild Recession in Europe but improving situation
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2012 GDP -0.5% 2013 GDP 0.8% 2014 GDP 1.5%

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Overall Market Overview

Market Activity on the Up Swing Oil & Gas remains strong. High oil prices drive the need to increase production from existing fields Power industry impacted by environment regulations as stricter emission guidelines would need new generation units to be built as replacement

Mining & Metals industry remains robust due to higher commodity prices (iron ore, copper, gold, aluminum, platinum, nickel, coal and 12/13/12 66 diamond)

Market Drivers Capital Markets Overview

Debt funding available but not Deep. No return to 2007/08 market terms anticipated Banks have mandate and capacity to lend but European lenders have been adversely impacted by Greek crisis To attract debt/equity, projects must demonstrate strong technical/commercial fundamentals Creditworthiness of all project constituents (sponsors, contractors, suppliers) is a key issue for capital providers
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Present Scenario

Even with tight liquidity situations, Oil and Gas Projects market is reviving. This is mainly due to increasing Energy Demand coupled with rising Oil and Gas Prices which are acting as catalyst to invest in New Projects as well increase the Capacity of Existing Plants.

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To implement New Projects or to Upgrade the Existing Ones, all the clients need specialized Engineering Services. What the are Services which are required for a Complete Project Cycle?

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Professional Engineering Services

Front-End Engineering and Design (FEED) Project Management and Consultancy (PMC) Engineering, Procurement, and Construction (EPC) Operations and Maintenance (O&M) Client Solutions

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Front End Engineering and Design (FEED)

Economic challenges are driving the need for absolute certainty that proposed capital projects will generate appropriate Returns on Investment (ROI) FEED studies with two primary goals:

Quantitative determination of ROI potential for proposed capital projects Preparation of quality bid packages (civil, electrical, electrical, and environmental) to ensure accurate bids and evaluations

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Project Management and Consultancy (PMC)

Formulation of detailed, documented, and clientapproved Project Execution Plans Development of Integrated Project Schedules for all contractors and sub-contractors Management of Resource Loading requirements for the Integrated Project Schedule Risk Reviews for all critical-path activities, and implementation of Risk Mitigation Strategies Development and implementation of Interface Management Plans

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Engineering, Procurement and Construction (EPC)

Contract Management in the role of Owners Engineer Process and Facilities Designs Plans and Procedures for Systems Integration Environmental Impact and Compliance Studies Development of Process, Civil, Mechanical, Electrical, Control Systems and Environmental, Safety Packages Development of Procurement Specifications and Procurement Packages Preparation of RFP Packages
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Professional Service Chain

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Pre-Design
Feasibility Studies Conceptual Design Process Simulation Estimating Project Finance Scope Definition Technology/License Evaluation

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Engineering
FEED Study and Endorsement Detailed Engineering Cost Control Planning and Scheduling Systems Integration Safety Planning

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Procurement

Materials Management Requirements Planning Sourcing Low Cost Country Sourcing Purchasing Supplier Quality Expediting Logistics Warehousing

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Construction

Labor Hire Staffing and Training Quality Control Safety Programs Equipments and Tools Supply Construction Management Field Mobilization Material Control

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Start-Up

Pre-commissioning Systems Check Plant Readiness Commissioning Engineering Support Initial Production Validation Handover

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Operations & Maintenance

Plant Operations & Maintenance Turnaround, Outages and Shutdowns Asset Performance Improvements Facility Management

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Characteristics of Project

Includes a start and end time Creates something new or fixes/improves something that already exists (green field or brown field projects) Proposes and supports change Change Management Performed by People & Teams Constrained by resources Planned, Executed and Controlled

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Participants of Project

Client Licensors Project Management Consultant (PMC) Contractor (LSTK/Cost Reimbursable) Vendors Specialist Service Providers

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Project Management

Complex and numerous activities Unique - a one time set of events Finite - a begin and end date Limited resources and budget Many people involved Sequenced activities End product or service must result

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Project Execution Plan

Project Execution Strategy Project Management Quality Safety Risk Management Design/Develop/Program Implementation Documentation Training

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Cornerstones of Project Management

Cost

Schedule

Scope

Quality

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Define Scope

Sets the baseline for cost and schedule Must involve the right people Must include implementation Identifies items not included Maximum influence on project cost Breaks project into manageable pieces

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Creeping Scope

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To Manage Creeping Scope

Keep scope documents current Freeze design after the estimate has been approved Allow only those changes that are justified by benefit Use an effective change management procedure

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Project Cost Estimation

Define project cost, integrate scope, schedule, and resources Define estimate basis Identify potential risks Identify contingency/escalation Identify items not included

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Project Cost Control

Establish the baseline (estimate) Measure variation from baseline Take corrective action

Basis for Project Schedule

Project objectives Project scope Project milestones Project estimate (budget) Resource availability
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Project Quality Management

Quality Assurance

Quality Control

Total Project Quality Management

Design Basis

Continuous Improvement

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Project Risk Management

Technical

Financial Socio-Economic Contractual

Sources of Risk
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Risk Management Process

Identify Risk

Analyze Risk

Respond to Risk

Document Risk

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Risk Containment

Clearly define insurance responsibilities in contracts Use qualified personnel Document and communicate project strategy Define roles and responsibilities Prepare contingency plans for critical activities Use up-front team building

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Project Closeout

Obtain client acceptance Document the project Conduct the post implementation audit Prepare Lessons Learnt Issue the final report

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Thank You

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