Delay Impact of COVID-19 Pandemic on Malaysia's Oil and Gas Projects

Abstract

COVID-19 pandemic has extremely affected people and businesses around the world. Oil and gas industry are not exempted, and negatively impacted by the unprecedent crisis of COVID-19. This pandemic has also caused delays in the oil and gas projects. In an attempt to control the spread of COVID-19, Malaysian government has introduced Movement Control Order (MCO) in the whole country to be closed and lockdown all premises except essential services to operate. This has resulted major delays in the project execution. Researchers have conducted studies to identify factors that causing project delays. Approximately 75 delay factors were found from previous studies and it revealed that most delay factors were not caused by COVID-19. In the current research, the delay factors due to COVID-19 were identified and some delay factors were found to have similarity with literature. Additionally, interview sessions were organized with oil and gas professionals involving in the oil and gas industry. Delay factors due to COVID-19 and mitigation strategies were identified from the interview sessions. Moreover, this result has used in the designing of survey questionnaire and distributed to project practitioners working in the oil and gas industry in Malaysia. 110 Oil and gas professionals include 52 Clients, 25 consultants, 23 contractors, 5 subcontractors and 5 vendors/suppliers have participated in the survey. Data collected from survey was analyzed and interpreted by means of median and Relative Importance Index (RII). Based on this information, delay factors and mitigation strategies were ranked according to their importance and impact to project. It is observed that the higher value of the RII the more critical cause or impact factor. Top seven (7) delay factors were identified and top seven (7) mitigation measures were proposed as recommendations for future implementation in the oil and gas project.