Factors Affecting the Success of Construction Projects in Petroleum Distributing Companies in Ethiopia: with a specific case of National Oil Ethiopia and Mulege Petroleum
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Date
2019-09
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Addis Ababa University
Abstract
Oil and Gas industry is an important industry that plays a vital role in socio-economic development of a country. A stable supply of oil and gas is needed to sustain continued development of our economies. However, Poor schedule and budget performance are major problems faced by today’s petroleum industry. Hence, this study tried to identify the major inhibiting factors for the success of construction projects undertaken by the Oil and Gas distributing companies in Ethiopia with a specific case of NOC Ethiopia and Mulege Petroleum. The study used survey data obtained through questionnaires distributed to the different Office Engineers, Site Engineers Contractors and Project Supervisors working with the two companies were taken and descriptive analysis was used to analyze the data collected. Cronbach Alpha was used to determine the “reliability” of the questionnaire and the result was 0.869 which shows that the questionnaire is reliable.
Hypothesis test based on independent t -test at 95% confidence level were also made. Results show that inflation and lack of foreign currency, design & scope changes, delay in commencement of projects and delay in provision of resources are the basic factors responsible for the cost overrun and schedule slippage of projects in the companies. Finally, a recommendation in which companies should have clear and detailed plan of project work, use efficient resource planning and avoid delay in commencement of projects and providing sufficient trainings can help to improve the performance of the projects was made based on the factors identified as affecting the success of projects in the industry
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Keywords
Project Success Factors, Budget Overrun, Schedule Slippage