Causes of common and frequent claims in oil, gas and petrochemical projects of Iran

Abstract

Over recent years, frequent involvements in claims have been inevitable due to unpredictable economic changes and increasing complexities in construction industry. Therefore, even appropriately made contracts are not exempted from claims. On the other hand, construction contract claims are time-consuming, expense-involving and most likely leading to unsatisfactory results. However, there may be some positive outcomes, such as time extension or compensation of damages. To launch investigations, a list of important and frequent claims in oil and gas industry projects of Iran was extracted after a succinct documents review. Further, the most important claim causes were identified through conducting a questionnaire survey among contractors, consultants, owners and lawyers involved in such projects. Reliability of responses has been examined, accordingly. The study reveals that the external risks like political, social, cultural and economical issues are the most important causes for claims in this industry. Moreover, inadequate financial resources on the part of owner and contractor, failure in performing contractor’s obligations and vague contract conditions resulted in formation of different interpretations; are some of the most important root causes of claims in this context.