Volume 1, Issue 1, November 2016, Page: 19-24
Financial Risks Contributing to Delay of Oil and Gas Projects in Egypt
Ahmed Yousry Beltagy Ahmed Akal, Civil Engineering Department, Faculty of Engineering, Menoufia University, Shibeen El-Kom City, Egypt
Received: Sep. 12, 2016;       Accepted: Nov. 1, 2016;       Published: Nov. 23, 2016
DOI: 10.11648/j.ijafrm.20160101.13      View  2223      Downloads  71
Abstract
Delay is a universal phenomenon in construction industry; and oil and gas construction projects in Egypt are not an exception. Oil and gas projects have a long construction cycle, huge investments, and multitudinous risks which negatively affect these projects’ objectives. One of the main risks which have been identified to hinder the projects development is the financial risks. This paper addresses the issue of financial risks contributing to the delay of oil and gas projects in Egypt. Outlining a detailed literature review, 18 financial risks have been identified and grouped into 4 main categories—namely: late payment, financial market instability, fiscal mismanagement, and imperfect policies and project studies. The identified risks are tabulated in a questionnaire form which was sent to engineers specialized in construction of oil and gas projects in Egypt asking their contribution to specify the severity of impact and frequency of occurrence of the 18 identified risks. The results reveal that the top ranked risks according to the severity of impact and likelihood of occurrence are project materials monopoly by suppliers and delay in subcontractors/suppliers progress payment by the main contractor respectively. While, delay in subcontractors/suppliers progress payment by the main contractor, lack of costs following-up during the project execution by the construction parties, owner delay in freeing the main contractor financial payments, project materials monopoly by suppliers, and contractor handling too many projects at the same time are the most important financial risks contributing to the delay of oil and gas projects in Egypt.
Keywords
Delay, Financial Risks, Oil and Gas Construction Projects, Egypt
To cite this article
Ahmed Yousry Beltagy Ahmed Akal, Financial Risks Contributing to Delay of Oil and Gas Projects in Egypt, International Journal of Accounting, Finance and Risk Management. Vol. 1, No. 1, 2016, pp. 19-24. doi: 10.11648/j.ijafrm.20160101.13
Copyright
Copyright © 2016 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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