Journal of Energy Management and Technology

Journal of Energy Management and Technology

Designing the Optimal Choice of Risk Response with Consideration of Secondary Risks in a Wellhead Installation Project in the Oil and Gas industry

Document Type : Original Article

Authors
Mahdi Rostami
Maryam Setayeshnia
Energy Economics & Management Department, Petroleum University of Technology, Tehran, Iran
10.22109/jemt.2024.419092.1473
Abstract
Identification and designing appropriate risk response actions for secondary risks alongside primary risk management are gaining increasing attention from project managers. Considering the limited number of research on secondary risks, the main purpose of this article is to investigate the consequences of ignoring or considering secondary risks when selecting the optimum risk response actions for primary risks within a wellhead project in Iran. The main contribution of the present study is to identify the primary and secondary risks and their relations with the project main activities to provide the optimal set of response actions considering the secondary risks in small scale wellhead project in the oil and gas industry in Iran. Cost minimization models through integer linear programming optimization were solved considering the secondary risks in selecting risk responses. The results indicate that considering the secondary risks can affect the selection of optimal risk response actions. Although considering secondary risks could increase the total cost of risks by 6,342 dollars, however, neglecting the secondary risks could result in selecting responses that cause more costs around 26,408 dollars. The present study might help project managers to manage their small-scale project risks better and avoid further losses.
Keywords
Project Risk Management
Risk Response Action
Secondary Risk
Optimization
Oil &‌ Gas Industry

Subjects

[1] P. PMI, "The Standard for Risk Management in Portfolios, Programs and Projects," 2019.
[2] X. Guan, T. Servranckx, and M. Vanhoucke, "Risk response budget allocation based on fault tree analysis and optimization," Annals of Operations Research, pp. 1-42, 2023.
[3] G. Dehdasht, R. Mohamad Zin, M. S. Ferwati, M. a. Mohammed Abdullahi, A. Keyvanfar, and R. McCaffer, "DEMATEL-ANP risk assessment in oil and gas construction projects," Sustainability, vol. 9, p. 1420, 2017.
[4] P. K. Dey, "Project risk management using multiple criteria decision-making technique and decision tree analysis: a case study of Indian oil refinery," Production Planning & Control, vol. 23, pp. 903- 921, 2012.
[5] C.B. Chapman, Large engineering project risk analysis, IEEE Trans. Eng. Manag. 26 (3) (1979) 78–86
[6] Bai Y, Dai Z, Zhu W. Multiphase Risk-Management Method and Its Application in Tunnel Engineering. Nat Hazards Rev 2014;15(2):140–9.
[7] Cummings CL, Rosenthal S, Kong WY. Secondary risk theory: validation of a novel model of protection motivation. Risk Analysis 2021;41(1):204–20
[8] H. I. Naji and R. H. Ali, "Risk response selection in construction projects," Civil engineering journal, vol. 3, pp. 1208-1221, 2017.
[9] A. Namazian and D. Behboodian. "Developing an optimization model for prioritizing and selecting project risk response strategies". Industrial Management Studies, 21, 71, 2024, 225-261. doi: 10.22054/jims.2024.75036.2870
[10] F. Zuo and K. Zhang, "Selection of risk response actions with consideration of secondary risks," International Journal of Project Management, vol. 36, pp. 241-254, 2018.
[11] H. Zhang and Q. Sun, "An integrated MCDM approach to train derailment risk response strategy selection," Symmetry, vol. 12, p. 47, 2020.
[12] T. M. Asl and T. S. Asl, " Startegy optimization for responding to primary, secondary and residual risks considering cost and time dimensions in petrochemical projects," Arhiv za Tehnicke Nauke/Archives for Technical Sciences, 2022.
[13] M. Parsaei Motamed and S. Bamdad, "A multi-objective optimization approach for selecting risk response actions: Considering environmental and secondary risks," Opsearch, vol. 59, pp. 266-303, 2022.
[14] H. Ghadir, S. A. Shayannia, and M. Amir Miandargh, "A Mathematical modeling of project risk response according to primary, secondary, and residual risks under conditions of uncertainty using the Tabu search algorithm," Journal of Industrial and Systems Engineering, vol. 14, pp. 50-66, 2022.
[15] Mariani C, Mancini M. Selection of projects’ primary and secondary mitigation actions through optimization methods in nuclear decommissioning projects. Nucl Eng Design 2023;407:112284.
[16] S. R. Ghanbari, B. Afshar-Nadjafi, and M. Sabzehparvar, "Robust optimization of train scheduling with consideration of response actions to primary and secondary risks," Mathematical Biosciences and Engineering, vol. 20, pp. 13015-13035, 2023.
[17] E. Ahmadi, S. M. Mousavi, and S. K. Eghbali, "A multiobjective model for selecting response strategies of primary and secondary project risks under interval-valued fuzzy uncertainty," Applied Soft Computing, vol. 160, p. 111679, 2024.
[18] F. Zuo, E. Zio, "Managing Secondary Risks with Optimal Risk Response Strategy and Risk-related Resource Scheduling", Reliability Engineering & System Safety, pp. 110028–110028, Feb. 2024.
[19] L. Urbanucci, "Limits and potentials of Mixed Integer Linear Programming methods for optimization of polygeneration energy systems." Energy Procedia 148 (2018): 1199-1205.
[20] Pellerin R, Perrier N, Berthaut F. "A survey of hybrid metaheuristics for the resource-constrained project scheduling problem". Eur J Oper Res 2020;280(2): 395–416
Journal of Energy Management and Technology
Volume 9, Issue 3
Summer 2025
Pages 177-189

  • Receive Date 02 October 2023
  • Revise Date 23 November 2024
  • Accept Date 29 November 2024