Financial Risks Contributing to Delay of Oil and Gas Projects in Egypt
International Journal of Accounting, Finance and Risk Management
Volume 1, Issue 1, November 2016, Pages: 19-24
Received: Sep. 12, 2016; Accepted: Nov. 1, 2016; Published: Nov. 23, 2016
Views 3077      Downloads 115
Ahmed Yousry Beltagy Ahmed Akal, Civil Engineering Department, Faculty of Engineering, Menoufia University, Shibeen El-Kom City, Egypt
Article Tools
Follow on us
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.
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 © 2016 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License ( which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Stumpf, G. (2002). Schedule delay analysis. Cost Engineering Journal, 42(7), 32-43.
Veazey, M. (2015). A remedy for cost overruns, project delays. http:// www.Downstream, Accessed on October 6, 2016.
Fallahnejad, M. (2013). Delay causes in Iran gas pipeline projects. International Journal of Project Management, 31(1), 136-146.
Khan, S. (2015). An analysis of critical causes of delay in oil &gas construction project. Proceedings of the Project Management National Conference, India, 1-18.
Alaghbari, W., Abdul Kadir, M., Salim, A., & Ernawati. (2007). Thesignificant factors causing delay of building construction projects in Malaysia. Engineering Construction and Architecture Management, 14 (2), 192-206.
Sambasivan, M., & Soon, Y. (2007). Causes and effects of delays in Malaysian construction industry. International Journal of Project Management, 25(5), 517-526.
Mukuka, M., Aigbavboa, C., & Thwala, W. (2015). Effects of construction projects schedule overruns: a case of the Gauteng province, South Africa. Procedia Manufacturing, 3, 1690-1695.
Abedi, M., Fathi, M. S., & Mohammad, M. F. (2011). Effects of construction delays on construction project objectives. Proceedings of the 1st Iranian Students Scientific Conference in Malaysia, UPM, Malaysia, 1-6.
Abd El-Razek, M., Bassioni, H., & Mobarak, A. (2008). Causes of delay in building construction projects. Journal of Construction Engineering and Management, 134(11), 831-841.
Fugar, F. D. K., & Agyakwah-Baah, A. B. (2010). Delays in building construction projects in Ghana. Australasian Journal of Construction Economics and Building, 10(1/2), 103-116.
Kazaz, A., Ulubeyli, S., & Tuncbilekli, N. (2012). Causes of delay in construction projects in Turkey. Journal of Civil Engineering and Management, 18(3), 426-435.
Abdul-Rahman, H., Wang, C., Takim, R., &Wong, S. (2011). Project schedule influenced by financial issues: evidence in construction industry. Scientific Research and Essays, 6(1), 205-212.
Vu, H., Wang, J., Min, L., & Nguyen, T. (2015). Impacts of the financial factors on schedule delays risk of the international contracting projects: evidence from highway BOT projects in Vietnam. World Journal of Engineering and Technology, 3, 311-319.
Saisi, E., Ngahu, S., & Kalio, A. (2015). Financial factors influencing successful completion of construction projects in public universities: a case of Egerton university, Kenya. International Journal of Economics, Commerce and Management, III(5), 1465-1476.
Aziz, R., & Abdel-Hakam, A. (2016). Exploring delay causes of road construction projects in Egypt. Alexandria Engineering Journal, 55(2), 1515-1539.
Kholif, W., Hosny, H., & Sanad, A. (2013). Analysis of time and cost overruns in educational building projects in Egypt. International Journal of Engineering and Technical Research, 1(10), 1-8.
Chang, A. (2002). Reasons for cost and schedule increase for engineering design projects. Journal of Management in Engineering, 18(1), 29-36.
Jergeas, G. (2008). Analysis of the front-end loading of Alberta mega oil sands projects. Project Management Journal, 39(4), 95-104.
Jergeas, J., & Ruwanpura, J. (2010). Why cost and schedule overruns on mega oil sands projects?. Practice Periodical on Structural Design and Construction, 15(1), 40-43.
Salama, M., Abd El Hamid, M., & Keogh, B. (2008). Investigating the causes of delay within oil and gas projects in the U.A.E. Proceedings of the 24th Annual ARCOM Conference, Cardiff, UK, 819-827.
Ruqaishi, M., & Bashir, H. (2015). Causes of delay in construction projects in the oil and gas industry in the Gulf cooperation council countries: a case study. Journal of Management in Engineering, 31(3), 1-8.
Long, P. E., R., 2016. Typical Problems Leading to Delays, Cost Overrun, and Claims on Process Plant and Offshore Oil &Gas Projects, Long International, Inc.
Abdul-Rahman, H., Takim, R., & Min, W. (2009). Financial-related causes contributing to project delays. Journal of Retail & Leisure Property, 8(3), 225-238.
Tah, J., Thorpe, A., & McCaffer, R. (1994). A survey of indirect cost estimating in practice. Construction Management and Economics, 12(1), 12-36.
Chua, D. Kog, C., & Loh, P. (1999). Critical success factors for different project objectives. Journal of Construction Engineering and Management, 125(3), 142-150.
Gudiene, N., Banaitis, A., Podvezko, V., & Banaitiene, N. (2014). Identification and evaluation of the critical success factors for construction projects in Lithuania: AHP approach. Journal of Civil Engineering and Management, 20(3), 350-359.
Akal, A., Abu El-Maaty, A., & El-Hamrawy, S. (2016). A circular framework for evaluating highway construction projects success: AHP approach. Civil Engineering Journal, 2(7), 324-333.
Nunnally, J. C., & Bernstein, I. H., 1994. Psychometric Theory, McGraw-Hill, New York.
Kaleem, S., Irfan, M., & Gabriel, H. (2014). Estimation of highway project duration at the planning stage and analysis of risk factors leading to time overrun. Proceedings of the 2nd Transportation &Development Congress, Orlando, Florida, USA, 612-626.
Science Publishing Group
1 Rockefeller Plaza,
10th and 11th Floors,
New York, NY 10020
Tel: (001)347-983-5186