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Master International Trade

Business (MITB-25, Valencia) Project management, EPC and Risks

Instructors: Prof. Victoria Martín Laguarda

E-mail Address:


1. Course 2019-20 Description

The world as a whole spends nearly $10 trillion of its $40.7 trillion gross product on
projects of all kinds. Today’s companies, governments, and non-profit organizations are
recognizing that to be successful, they need to use modern project management
techniques. Most of the international trade initiatives are being performed through
projects and therefore project management techniques are increasingly taking a higher
relevance in the international trade context in which MITB is framed.

EPC contracts have become one of the most prominent ways to perform international
trade business in energy, construction and other sectors throughout the world. Their
capital intensive investment and the risks associated with these kind of projects make it
necessary to implement a powerful project management approach to avoid time and cost

Today’s Engineering, Procurement and Construction (EPC) projects are becoming more
complex and are being implemented on a much larger scale, with large contract values.
Companies need to have a clear strategy on how to draft, manage and negotiate their
EPC contracts in a way that protects their organization from costly delays, cost
overruns, disputes and liabilities. No matter how complex the project may be, only the
best utilization of all affordable tools for risk mitigation will ensure mutual profit and

Leading organizations across sectors and geographic borders have been steadily
embracing project management as a way to control spending and improve project results.

Project risk management, as part of the project management processes, is the art and
science of managing risks caused by unforeseen changes (uncertainties), which may
require deviations from the planned approach and may therefore affect the achievement
of the project objectives. It involves systematically identifying, analyzing, planning and
controlling risks.
The seminar aims to introduce students into these three intertwined areas. Starting form
Project Management knowledge areas and project life cycle concepts followed by EPC
contracts special features to focus on project risk management on EPC contracts since
those are the most critical projects which are being carried out in the international trade

2. Learning objectives

At the end of the unit, it is expected that students will have acquired the following skills:
1. Identify the key project management knowledge areas and their relation with the
project life cycle.

2. Recognize the critical success factors and constraints when managing an

international project.

3. Explain how project management facilitates the alignment of the strategic

management process with the resource allocation within the company
international business strategy.
4. Identify the main types of contracts in the field of international construction
projects, their organizational structures and advantages from the customer point
of view.

5. Identify the more common forms of international construction contracts identifying

the key aspects of each of them.

6. Demonstrate an understanding of the fundamental aspects on an EPC contract

identifying contractor’s and constructor’s roles and responsibilities.

7. Identify and analyze the main differences between an EPC contract and other
construction contracts (turnkey, cost reimbursable, etc.).

8. Describe the different management roles in an EPC contract comparing the key
aspects of each of them.

9. Explain the different risks that an international project can face during its execution.

10. Apply a risk management model to an EPC contract identifying the main risks that
could be faced during the project life cycle.

3. Teaching methods and learning strategies

The methodology of the course is primarily based on developing educated and rationally
oriented opinions to make project decisions driven by conceptual frameworks, factual
evidence, proven tools and scientific techniques on EPC Project and Risk Management.
The unit is organized around student centered learning through different means, i) class
lecture, ii) discussion of EPC Project and risk management issues extracted from real
practice. To achieve this, a high level of commitment and interaction is needed.

4. Teaching Schedule
There will be one 5-hour session in which we will be developing the topics shown here-

Session Date General Topic Covered Content

1 28/03/2020 EPC contracts Types of contracts
Introduction to Project Management EPC projects
tools and techniques. What is a project
Project Risk management models What is project management
What is a turnkey project and the EPC
Risk in different types of contracts
Basic risks and attitudes towards risks
Project Risk Management process
Risk Management in EPC Contracts

5. Course References


Dale F. Cooper, Stephen Grey, Geoffrey Raymond and P. Walker., 2005, Project Risk
Management Guidelines, London: John Wiley.

Recommended Books

Chris Chapman, Stephen Ward, 2003, Project Risk Management: Processes, Techniques
and Insights. London:John Wiley.

PROJECT MANAGEMENT INSTITUTE, 2004, A guide to the project management body of

knowledge (PMBOK guide). Pennsylvania: Project Management Institute.

Recommended Journal Articles

George E. Baram, P.Eng. 2003. Project Management Oversight: An Effective Risk

Management Tool for EPC/Design-Build Projects. AACE International Transactions.

McKinsey, 2013. A risk-management approach to a successful infrastructure project.

McKinsey Working Papers on Risk, Number 52. London: McKinsey
Phil Loots, Nick Henchie, 2007. Worlds Apart: EPC and EPCM Contracts: Risk issues and
allocation.. London: MAYER-BROWN
Carlson, Mark .,2007. Delivering to cost in an EPC world. Pennsyvania. PMI

Luis D. Alfaro, Gregory B. Baecher, Fernando Guerra, Robert C. Patev., 2015. Assessing
and Managing Natural Risks at the Panama Canal. 12th International Conference on
Applications of Statistics and Probability in Civil Engineering, Vancouver: ICASP12

Kerur S & Marshall W., 2012, Identifying and managing risk in international construction
projects, London:International Review of Law

Useful websites: Organizational Behavior industry and research

Project Management Institute:

The Institute of Risk Management:

International Federation of Consulting Engineers. (FIDIC):

6. Lecturers’ short bio

Victoria Martín is a lawyer with more than 25 years of experience in International Trade.

She is a postgraduate programs lecturer at ESIC Business & Marketing School.

Education: Master in Marketing -GESCO- at ESIC Business & Marketing School, Master in International Trade
Management at Universidad de Valencia, Master in Legal Proffession Improvement and Practice at Colegio de
Abogados de Valencia, Law graduate at Universidad de Valencia.

Professional experience: She has worked at the Export Department of different Spanish companies mainly
working with consumers goods.

Deep knowledge of promotional tools for International Trade as well as great experience in Asian markets.

International Consultant and teaching at different Business Schools. She is certified Consultant for ICEX,
IVACE and Chambers of Commerce.