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Chapter 3 EPC Project Risk Management Overview 3.1 Project Risk Management – Definition

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Before proceeding further, I feel that it is pertinent to table my definition of what Project Risk Management is in regard to a Contractor undertaking a lump-sum Engineering, Procurement and Construction (EPC) Project, since it is the driver of the observations and advice that follow within this book.

Project Risk Management is the systematic process of:

1 proactively identifying the major potential hazards/risks for the Project as early as possible (and revisiting/redoing that exercise regularly throughout the entire duration of the Project);

2 properly analysing and assessing each of the identified hazards/risks in turn, so that sound commercial decisions can be reached as to what the most appropriate response to each should be;

3 putting in place adequate mitigation measures where necessary to counter those hazards/risks; and

4 regularly monitoring the effectiveness of employing the hazard/risk mitigation measures and making appropriate modifications if later those measures are found to be ineffective.

Practical Risk Management for EPC / Design-Build Projects

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