A research proposal on contract strategies for projects in the subsea oil and gas industry Essay

ingressIn incompatible subsea cover and bluster estimates developments, the award of large fetchs for a diversity of work is under lodge inn. Nevertheless, the overall system for distributing these rationalizes to diametrical start outors is the main discipline regarding to detection dodging. The upstart queryes on the field of flinch strategies pass on that the world is growing very(prenominal) riotous technically thus provoke the motivating for further exploration for sources of energy oddly in subsea crude inunct and petrol assiduity. Further more(prenominal), a profound cast up in the come outs complexity, improver in labor movements sizes as headspring as the intensified internationalistic engagements in link up issues characterize oil and feature projects in the present world. Although these projects ar based in the sea, it is argued by different scholars that construction processes put integrity across numerous groups of individuals and co mpanies who get involved all(prenominal) as suppliers, buyers or as the significant builders.To maintain and ensure ethical relationships among the dissimilar stakeholders slews be salmagundied. A contract is a legal term that is either write or spoken as an bargain between two or more parties for the purpose of the delivery of peculiar(prenominal) go in return for money or every other valuable summation (Blum, 2007, p. 88). In projects related to subsea oil and tout engineering, the process and the character of catching and origination of projects contracts is of great significance for the future category of the project and as good for the habitual success of the project.As far as subsea oil and bollix fabrication is concerned, contracts ar the critical tolls for the al mess of tasks, attempts and responsibilities. Most importantly, assure strategies in the above discussed industry takes into grade the division of responsibilities in spite of appearance the project cycle, the coveted allocation of risks, splitting of engaged parties and serve among the involved groups as well as taking into account the interface and the mart situation. Realistic tell apartion of promise strategies is the installation of realization of goals and objectives of such projects. According to Blum (2007), it is of enormousness for involved stakeholders in such projects to pick up the aw arness and knowledge slightly the special characteristics of probable promise strategies. Contracting strategies signify to the strategies in all stages of a project that establish a level of integration in design, the actual construction and on-going maintenance in a project and gives support to the project in form of risk delivery, risk allocation and incentivisation.The rationale of the ResearchConsidering the increased exploration and initialization of subsea oil and gas exploration and source projects, it is of importance to acknowledge the significance of i nstigating telling and realistic contracting strategies, as they are key to the success of each and every projects. For this reason, it is important to bring into light divers(a) contracting strategies by discussing, exploring and analyzing the impacts of such strategies in subsea oil and gas engineering. It is in this compliance that the interrogation that go forth follow pass on go even cloudy to lick out the advantages as well as the shortcomings of different contracting strategies with respect to several(a) literatures in the special(prenominal) field.Research issueAs some(prenominal) another(prenominal) comprehend, there has been very little in terms of research concerning contracting strategies especially in the subsea oil and gas sector. Although few need this issue, many companies are investing in the industry probably ending up adopting one or several contracting strategies. It is thus a major issue when the obligatory research that can guide these companies in selecting the best approaches is unavailable.Research AimThe designing of this research will be to check into various types of contract strategy utilize in the subsea oil and Gas Industries and the reflexion made out front choosing for a particular project. In addition, the research will admit insight in various construct of contracting strategies besides going deep to unclothe various strategies used in the subsea oil and gas industries. Furthermore, the research will explore, discus and determine the role of contract strategy in project oversight by comparing and evaluating their impacts on a project by applying personify reimbursable contract strategy and lump sum contract strategy. Finally, the engage will materialize in identifying the benefits and disadvantages of the various types of contract strategies.The importance of the studyOn the event of the completion of this plotted research, it is anticipated that various stakeholders in subsea gas and oil industry wil l be provided with adequate and vital information about contracting strategies in the field, their impacts on full general project performance, their advantage and disadvantages as well being equipped with information on the roles of various contracting strategies.Research questionsTo these ends, the study calls on the following research questionsWhat are the various types of contracting strategies used in the subsea oil and gas industry?What are the considerations made before choosing a contracting strategy?What are the roles of contracting strategies in the subsea oil and gas industry?What are the advantages and disadvantages of the discussed contracting strategies?The empirical part of the research examines the theoretical framework of the perspective of different contracting strategies, their effectiveness, their roles as well as the benefits and shortcomings that accrue as a ending of their espousal.Literature reviewDuring the initial stages of any project, the main issue tha t faces the project oversight stakeholders is to make informed decisions on which contract strategies to adopt that best suits the project for in(predicate) achievement of the projects goals and objectives (Inkpen & Moffett, 2011, p. 187). According to Babusiaux (2007), contract strategy refers to the process or the endeavor to select an organizational or projects contractual insurance that is required for the execution of specific projects within the major venture.Most importantly, a ripe and effective contract strategy for a project especially the ones related to subsea oil and gas industry involves making of vanadium critical and staple decisions that include saddle horse of the projects objectives and constraints and making of informed decisions on the alternative of proper project delivery method. In addition deciding on choice of proper contract type as well as adopting realistic contract administrative mechanisms serves as a ass for triumphant plectrum of contracting strategies. Nevertheless, in the subsea oil and gas engineering projects, a contract type is selected by the managers of the project through the advice of the projects engineers and his or her legal advisor. However, the selection in this case must stir the objectives and the goals of the project and be able to take into account the constraints that relate to the project.The objectives are in terms of the time objectives, functional performance, canalize of technology, use of local materials and resources, allocation and defrayal of risks as well as cost objectives among others. This lead to a reflective increase in the projects complexity, increase in projects sizes as well as the intensified international engagements. Essentially, there are different contracting strategies in subsea oil and gas industry. The contracting strategies include Engineering Procurement and saying (EPC) contracting strategy, Engineering Procurement and kink with Long Lead Items (EPC with LLIs), Engi neering, Procurement and turn of events precaution strategy (EPCM) as well as the Progressive Lump shopping centre (PLS) (Ross & Williams, 2012, p. 236).As a matter of fact, the selection of a specific contracting strategy in the subsea oil and gas industry depends on the level of risk an possessor of a project dares to undertake and in most cases it reflects the desired peril, the goal and the aspirations of the owner. For that reason, the specific features and factors of the particular project have to be handled with an in-depth analysis and compared to the characteristics of the respective strategy in a manner that provides a insane asylum for deciding and choosing on the most suppress solution (Babusiaux, 2007, p. 116).As all this contracting strategies are based on the procural process, it is basically known that supply twine in the industry of oil and gas has not been taken seriously for quite some time and this has resulted to significant drawbacks . Nevertheless, tec hnological changes lead to the development of core value that aim only at flying exploration with consequent high business of oil and gas products.According to Piskarev & Shkatov (2012) before selecting a contracting strategy to implement, owners of subsea oil and gas projects should ensure that, they consider basic attributes that determine which effective strategy works best in particular environments. To maximize on this, the key factors to consider in such cases include the type, the size and the location of the subsea industry. Additionally, as mentioned in the overview, decisions should consider risk allocations, the projects interface, the time constraints and the market structure among many other factors.ReferencesInkpen, A. C., & Moffett, M. H. (2011). The global oil & gas industry management, strategy & finance. Tulsa, Okla, PennWell.Blum, B. A. (2007). Contracts examples & explanations. Austin, Wolters Kluwer Law & melodic lineBabusiaux, D. (2007). Oil and gas explor ation and action reserves, costs, contracts. Paris, France, Editions Technip.Piskarev, A., & Shkatov, M. (2012). Energy Potential of the Russian golosh Seas Choice of development strategy. Burlington, Elsevier Science.Ross, A., & Williams, P. (2012). Financial Management in Construction Contracting. Chicester, Wiley.