MSc Management BT7073: Fundamentals of Project Management Case Study

This document presents a comprehensive analysis of the Salvaje Bay case study within the context of project management fundamentals. It begins with an introduction to the project, which involves developing a Natural Gas Liquid (NGL) plant in South America. The analysis covers key project management aspects, including defining project objectives using the iron triangle parameters (scope, cost, time, and quality), conducting a risk assessment to identify and mitigate potential risks, creating a Gantt chart for project planning and scheduling, developing a resource histogram to manage resource allocation, preparing a human resource budget, estimating gross profit, rescheduling the project plan to address incomplete tasks, and performing an earned value analysis to assess project performance and forecast completion. The document also explores acceleration options and concludes with a reflective essay discussing the challenges and problems encountered during the project. This detailed solution is valuable for students studying project management, and Desklib offers a platform to access similar solved assignments and study resources.

FUNDAMENTALS OF THE
PROJECT MANAGEMENT
TABLE OF CONTENT

S
Part a...........................................................................................................................................1
Introduction................................................................................................................................1
SECTION A: SALVAJE (WILD) BAY CASE STUDY 426...................................................2
Project Objectives......................................................................................................................3
Discuss the importance of iron triangle parameters in developing objectives of the project.3
Risk Assessments.......................................................................................................................3
Create risks register by identifying 10 risks that IEOG are facing in this project..................3
Project Plan (Gantt chart)...........................................................................................................7
Prepare Gantt chart for the project.........................................................................................7
Resource Histogram.................................................................................................................13
Develop weekly resource histogram....................................................................................13
Human resources Budget.........................................................................................................13
Prepare Human resource budget for the whole team............................................................13
Gross Profit..............................................................................................................................14
Estimate gross profit for the project.....................................................................................14
Rescheduled Project Plan.........................................................................................................14
Prepare reschedule plan for all the incomplete work...........................................................14
Earned Value analysis..............................................................................................................16
Prepare Earned value table analysis.....................................................................................16
Acceleration options.................................................................................................................18
Explain reasoning for all the options....................................................................................18
PART B REFLECTIVE ESSAY.............................................................................................19
Prepare a reflective essay that considers all the challenges and problems encountered in this
project...................................................................................................................................19
REFERENCES.........................................................................................................................21

PART A
INTRODUCTION
Current project is based on developing Natural gas liquid plant located on the west
coast region of South America along with the support of the government as the local
government has initiated for this project by giving the contract to a European company
named as Inter Europe plc that taken this contract in $195M which consists of $175M as the
targets constructions and rest amount includes the profit element demanded from the
government for the construction of this project (Kerzner, 2018). This project highlights on
various elements which helps completing the same within the stated deadline given strictly by
the government as delaying penalty of $1M per well will get imposed on the construction for
not giving the final outcome on time which creates a pressure on a project manager to fulfil
the aim of its clients within the time (Martinsuo and Hoverfält, 2018).
Firstly, project objectives are created that is based on the entire nature of the overall
project to guide a manager to achieve all its targets before the time get elapsed (Remeljej and
Hoadley, 2006). Secondly, all the existing and potential risks related to this project are
identified to craft mitigation strategy to safeguard the interests of the client (Carnall, 2018).
Gantt chart is prepared to visually all the tasks to know the actual completion time required to
achieve all the aims (Kidnay, Parrish and McCartney 2011). Resource histogram is prepared
to the know the requirements of all the resources required for this project for a weekly period
(Jiang and et.al., 2018). Human resource budget is prepared for all the team members to
know the personal expenses incurred by all the members separately. Gross profit is
determined by deducting all the expenses incurred in the project from the total revenues
generated from this project (Tonchia Tonchia and Mahagaonkar, 2018). Re-scheduling of the
project plan after considering all the incomplete tasks taken into consideration (Long and
Lee, 2013). Earned value analysis will be based on several criteria such as calculating the
projected completion date of the project; the projected final costs required in completing this
project and also reflect its impact on the entire project (Westerveld, 2003). Justifications for
all the acceleration options are covered to decide which option to select or reject (Jiang, Bian,
2017). In the final stage, reflective essay will be attached to this project analysis report to
target all the challenges and the problems encountered by the project manager as in this stage
the personal experience of the project manager and all its team members are included in this
phase as the motive of the owner and the project supervisor is to appreciate the talents and
special skills of all the action and the passive users participates in this project to accomplish
1

all the aim and the targets of the project to get it complete within the prescribed time period
(Pinto and Prescott, 2018).
SECTION A: SALVAJE (WILD) BAY CASE STUDY 426
Salvaje Bay is a project initiated by the South American government which is based
on that is NGL that is Natural gas liquids which is small scale plant about to build on the
undeveloped port of the South America country located in the west coast region (Umble, Haft
and Umble, 2013). The operation of the plat includes various steps such as filtration phase
which covers the separation of oil from the gas to keep the natural ingredient in the produced
gas which will further pumped into marine terminal setup at the Salvaje bay. This will piped
to two kilometres new plant from which methane is separated and sent to the national grid
plant (Kim, Noh and Chang, 2018). Ethane is piped to the nearby ethylene cracker plant for
the further processing. In the further processing, propane and butane will get chilled to create
liquid solution to get stored in the tanks (Priswanti, Andini and Putri, 2018).
This plant have the support the national government as this development of the plant
will generates several local jobs and also boosts the overall economy which in turn induces
the entire productivity of a start up who intends build NGL plant in the backward area
(Matthews and et.al., 2018). South America is good for the education purpose whose tourism
will get increases when this plant comes into operation that produces several jobs that
enriches the existing capabilities of all the employees are expert in the chemical engineering
or related to the current field to give benefit of their skills to the owner of the pant also the
government whose motive is to conduct several social welfare activities (Bryde,
Unterhitzenberger and Joby, 2018).
Before the final operation of this plant, the government of these regions invites
tenders for the construction of the plant by inviting several engineering and oil companies to
show their interest in this particular project (Jadhav and Shinde, 2018). After some moths of
the negotiations, finally the salvaje bay project were taken by European company named as
Inter Europe oil and gas plc in a contract price of $175M for the construction costs and
$195M for the profits in the first year (Strucker, 2018). One condition is included in this
contract that if the targets costs does not included the profit element for the first year then
they will get an additional 5% savings in the total profit in a proportion of 1:1 with the
government but if the cost of this project exceeded then the contractor will get liable for first
5% after sharing equal profit with the government as mentioned in the legal contract. Late fee
2

of $M per week will get imposed on the contractor for not submitting the final project within
the stipulated deadline (Liu, Sun, Ni, Yang and Song, 2018).
PROJECT OBJECTIVES
Discuss the importance of iron triangle parameters in developing objectives of the project
 To determine the scope of the construction of NGL Project
 To evaluate the costs of the construction of NGL Project
 To determine the time of the construction of NGL Project
 To determine quality of the service provided by the contractor in constructing NGL
project
Iron triangle parameters of the project play an integral role in determining the project
objectives for the current project of constructing plant of NGL located in the countryside area
of the South America that is the west coast region which is underprivileged that needs further
development in terms of the population residing there, facilities and basic amenities available
there (Semerci and Çelik, 2018). These three parameters include scope, cost and time which
are the three criteria’s used to accomplish the overall aims and set targets created by the
project manager to deliver the quality oriented service to its clients that are the government
(Pheng, 2018). Quality is one of the important things uses by a contractor in building existing
as well as the future relationship with its clients to increase the quantity of the work supplied
by its clients (Pinha and Ahluwalia, 2018). Higher levels of the customer satisfaction will get
achieved by an entity by satisfying its current user which will get achieved with the help of
high quality of the services provided by the firm to its clients to keep them motivated with
their business for a longer period of time (Bredillet, Tywoniak and Tootoonchy, 2018). In the
current project (Vinegar, Akkurt and Tutunjian, Shell Oil Co, 2010), European construction
companies will create a strong business connection with its clients that is the national
government of South American to reduce the complexity of the legal proceedings of its
business (Qyyum, Ali, Hussain, Bahadori and Lee, 2018).
RISK ASSESSMENTS
Create risks register by identifying 10 risks that IEOG are facing in this project
Risk Management Register for NGL Project
Risk Identification Assessment Response
Monitoring and
Control
Ref
ere Event Caus
e Effect Pro
babi
Im
pa
P Str
ate
Trigg
er Action Resp
onsi
Rev
iew
Stat
us
3

nce lity ct
x
L
gy
ble
pers
on/s
Fre
que
ncy
date
and
gene
ral
note
s
1 Lack
of
fundi
ng
Bud
get
Con
strai
nts-
alloc
ation
in
doub
t or
subj
ect
to
chan
ge
(Erg
a,
Juliu
ssen,
and
Lida
l,
2015
)
Projec
t
delaye
d
4 5 2
0
Mit
igat
e
Projec
t's
spons
ors
fail to
ensur
e
secure
fundi
ng
level
when
the
plan
is
prese
nted
Conduct
another
funding
round,
seeking
support
from key
stakehold
er
groups,
including
the
executive
sponsor
Proj
ect
Man
ager,
Exec
utive
Spo
nsor
Mo
nthl
y
1/08
/18
Regi
ster
upd
ated
.
Alte
rnati
ve
fund
ing
sour
ces
iden
tifie
d
2 Unav
ailabi
lity
of
const
ructio
n
mater
ial
Lack
of
mar
ket
surv
ey
Projec
t
delaye
d
5 4 2
0
Mit
igat
e
Contr
actor
did
not
enquir
e
about
the
availa
bility
of all
the
materi
als
before
taking
up the
projec
t
Stocks
are
imported
from
another
country
to meet
the
current
requirem
ent and
also
create
stock of
all these
items for
the future
purpose
Proj
ect
Man
ager
We
ekly
8/8/
201
8
3 Perm Poor Dissat 3 2 6 Mit Projec Question Exec Mo 9/1/
4

ission
of
local
resid
ents
for
buildi
ng
chem
ical
plant
in the
resid
ential
area
prop
erty
mar
ket
anal
ysis
isfacti
on
amon
g
projec
t
users(
Sangh
era,
2019)
igat
e
t
execu
tives
did
not
taken
the
conse
nt of
all
their
partie
s
before
finaliz
ing
the
projec
t(Gra
y, and
McCli
ntock,
Cono
coPhil
lips
Co,
2014)
naires are
created to
get the
consent
of all the
parties
directly
or
indirectly
related
with this
particular
project(K
erzner,
and
Kerzner,
2017. )
utive nthl
y
201
8
4 Incre
ase in
Cost
Lack
of
oper
ation
al
budg
et
Leads
to the
penalt
y
2 5 1
0
Mit
igat
e
Lack
of
negoti
ation
policy
devel
oped
by a
mang
er to
reduc
e the
overal
l
cost(L
u, and
Wang
,
2009)
The
increase
in costs
issue is
controlle
d by
creating a
new
negotiati
on policy
and
forecaste
d
analysis
Tech
nical
anal
ysts
We
ekly
9/8/
201
8
5 Labo
r
strike
No
meet
ing
with
Increa
sing
costs
in the
3 4 1
2
Not
mit
igat
ed
Dema
nds of
the
labors
This risk
will get
reduces
by
Man
ager
We
ekly
9/16
/201
8
5

the
unio
n
labo
ur
mem
ber
projec
t
are
fulfill
ed by
the
projec
t
spons
or
fulfilling
all their
expectati
ons by
increasin
g their
monetary
compens
ation(Shu
ping,
Xiaohong
,
Lianlian,
and Jie,
G., 2015)
6 Site
accid
ents
No
eval
uatio
n of
the
site
Increa
sing
costs
and
projec
t
delay
4 5 2
0
Mit
igat
e
Poor
safety
measu
res
follo
wed
on the
site
Use of
safety
gears and
measures
to save
the lives
of all the
executive
s
working
on the
site
Arch
itect
We
ekly
9/24
/201
8
7 Ineffi
cient
empl
oyees
Lack
of
wor
king
expe
rienc
e
Projec
t
failure
1 5 5 Mit
igat
e
Lack
of
traini
ng
and
worki
ng
experi
ence
of all
the
emplo
yees
On- the
job
training
method is
followed
by an
entity
Tea
m
lead
er
We
ekly
09/3
0/21
8
8 Incre
asing
client
's
requi
reme
nt
With
the
advi
ce of
othe
r
parli
ame
nt
mem
Increa
ses
projec
t
timeli
ne
1 5 5 Not
to
mit
igat
e
Contr
action
or
extens
ion in
the
constr
uction
of the
plant
Meeting
with the
clients on
weekly
basis to
give the
status of
the work
to them
to avoid
Proj
ect
man
ager
We
ekly
10/1
/201
8
6

bers any kind
of
miscomm
unication
s
9 Lack
of
staff
moral
e
Due
to
incre
asin
g
wor
kloa
d
Projec
t
failure
2 5 1
0
Mit
igat
e
Empl
oyees
are
not
satisfi
ed
with
the
work
pressu
re
given
to
them
Monetary
motivatio
n is given
to them
to keep
them
motivate
d towards
the work
offers to
them
Tea
m
lead
er
We
ekly
10/7
/201
8
10 Poor
weat
her
condi
tions
Start
ing
the
cons
truct
ion
in
wro
ng
weat
her
Projec
t
failure
1 5 5 Not
to
Mit
igat
e
Lack
of
predic
tive
analys
is
Safeguar
ding the
constructi
on of
plant by
making
external
arrangem
ents
Anal
ysts
We
ekly
10/1
4/20
18
PROJECT PLAN (GANTT CHART)
Prepare Gantt chart for the project
Task Name Duration Start Finish Predecessors
Design Work Mon
10/12/09
Mon
10/12/09
Site Surveys 12 days Mon
10/12/09
Tue
10/27/09
Concept Designs 20 days Mon
10/12/09 Fri 11/6/09
Detailed Design 27 days Mon 11/9/09 Tue
12/15/09 2,3
Planning Submissions 5 days Wed
12/16/09
Tue
12/22/09 4
Interface Studies 15 days Wed
12/16/09 Tue 1/5/10 4
7

Design Approved 0 days Tue 1/5/10 Tue 1/5/10 5,6
NGL Plant Mon
10/12/09
Mon
10/12/09
Contractor Design work 20 days Wed 1/6/10 Tue 2/2/10 7
Design Approved by NPI 0 days Mon
10/12/09
Mon
10/12/09 8
Site clearance 15 days Wed 2/3/10 Tue 2/23/10 9
Foundations 20 days Tue
10/13/09 Mon 11/9/09 10
Civil Works 35 days Wed 2/24/10 Tue 4/13/10 11
Mechanical systems 30 days Wed 2/24/10 Tue 4/6/10 11
Electrical and control
systems 20 days Wed 2/24/10 Tue 3/23/10 11
Piping and utilities 25 days Wed 2/24/10 Tue 3/30/10 11
Pre-Commissioning 10 days Wed 2/3/10 Tue 2/16/10 7,8,9
Ethylene Cracker Mon
10/12/09
Mon
10/12/09
Contractor design work 25 days Wed 1/6/10 Tue 2/9/10 7
Design approved by NPI 0 days Tue 2/16/10 Tue 2/16/10 17
Site clearance 25 days Tue
10/13/09
Mon
11/16/09 18
Foundations 20 days Wed 2/10/10 Tue 3/9/10 19
Civil Works 30 days Wed 2/17/10 Tue 3/30/10 20
Mechanical systems 25 days Tue
11/17/09
Mon
12/21/09 21
Electrical and control
systems 20 days Wed 3/10/10 Tue 4/6/10 22
Piping and utilities 30 days Tue
11/17/09
Mon
12/28/09 21
Pre-Commissioning 10 days Wed 3/31/10 Tue 4/13/10 23,24
Port Development 1 day Mon 11/9/09 Mon 11/9/09 3
Dredging Works 125 days Mon 11/9/09 Fri 4/30/10 3
Civil Construction 80 days Wed
12/16/09 Tue 4/6/10 4
Electrical services 25 days Wed 4/14/10 Tue 5/18/10 27
Telecom and Control 20 days Tue
11/10/09 Mon 12/7/09 28
Fire station 25 days Wed 4/14/10 Tue 5/18/10 27
Port Operational 0 days Fri 4/30/10 Fri 4/30/10 26,29,30
Social Infrastructure Mon
10/12/09
Mon
10/12/09
Estate planning 10 days Wed 1/6/10 Tue 1/19/10 7
Service roads 30 days Wed 5/19/10 Tue 6/29/10 31
Drainage and water 25 days Tue 12/8/09 Mon 1/11/10 32
Electrical services 15 days Wed 5/19/10 Tue 6/8/10 33
8

Housing units 35 days Mon 5/3/10 Fri 6/18/10 34
School complex 20 days Mon 5/3/10 Fri 5/28/10 34
Medical center 10 days Wed 1/20/10 Tue 2/2/10 36
Retail units 20 days Wed 6/30/10 Tue 7/27/10 37
Infrastructure complete 0 days Mon 1/11/10 Mon 1/11/10 38
Road Network Mon
10/12/09
Mon
10/12/09
Layout Finalized 5 days Wed
10/28/09 Tue 11/3/09 2
Leveling works 60 days Mon 6/21/10 Fri 9/10/10 40
Access roads 40 days Mon 5/31/10 Fri 7/23/10 41
Circular roads 25 days Wed 2/3/10 Tue 3/9/10 42
Plant Network 30 days Wed 7/28/10 Tue 9/7/10 43
Road lighting 20 days Tue 1/12/10 Mon 2/8/10 44
Roads Complete 0 days Mon
10/12/09
Mon
10/12/09 45
Commissioning Mon
10/12/09
Mon
10/12/09
NGL Process system 15 days Wed 3/31/10 Tue 4/20/10 16
NGL control system 15 days Wed 11/4/09 Tue
11/24/09 46
NGL Fire safety system 10 days Mon 9/13/10 Fri 9/24/10 47
Cracker Process system 15 days Wed 4/7/10 Tue 4/27/10 25
Cracker control system 15 days Wed 3/10/10 Tue 3/30/10 49
Cracker fire safety system 10 days Wed 9/8/10 Tue 9/21/10 50
Site fully operational 0 days Tue 5/18/10 Tue 5/18/10 31
9

Figure 1 Gantt chart
10