A stage-gate integrated risk control system for LNG plant projects: Focusing on the

design phase

The increased demand of liquefied natural gas (LNG) has led to the rapid growth of
LNG plant developments around the world. However, these plant construction projects often
interrupted which bring about schedule delay and cost increase due to many factors of risk
caused by the projects complexity, large scope and strict requirements for high-quality
materials and equipment. For instance, the risk increase due to its distinct characteristics such
as the monopolized FEEDs technology, low-temperature and high pressure equipment. Thus,
risk management in the earlier stage which is in design phase is more important to ensure the
project will be conducted efficiently. LNG, specifically, need a great capacity of Front-End
Engineering Design (FEED) on various risk such as regulation, labor, license, design
requirements and among others. Due to this monopolized FEEDs technology market,
designers and contractors pursuing LNG projects have been experiencing difficulties in
managing risks especially in the design phase. So, this study established the advanced
framework which does not require theoretical knowledge of complex statistics and simulation
techniques, which is a stage-gate risk control system that could be applied in the design phase
of LNG projects. The source-event and the risk path concept are incorporated to identify the
causal relationship between risk factors and support a better risk mitigation strategy
development. The PIC quantification method is proposed to effectively prioritize the critical
risks based on their manageability and controllability of a given risk item. This study also
introduced the stage-gate risk process to assure a phased risk identification, control and
monitoring. Consequently, the web-based prototype risk control system was developed which
can identify, quantify, prioritize, control and monitor risks of LNG projects in the design
phase. This study focus on the development of risk control system for the lifecycle of LNG
projects. Since the proposed risk control system and identified risk factors cover only the
design phase of LNG projects, its scope would be extended to cover the succeeding phases
such as procurement and construction.